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Employee Benefit Plans | 12 Months Ended
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Feb. 25, 2023
Retirement Benefits [Abstract] |
Employee Benefit Plans | Employee Benefit Plans 401(k) Retirement Plan We sponsor a single 401(k) retirement plan covering substantially all full-time, non-union employees, as well as union employees at two of our manufacturing facilities. Under the plan, employees are allowed to contribute up to 60 percent of eligible earnings to the plan, up to statutory limits. On January 1, 2023, we began matching 100 percent of the first two percent contributed and 50 percent of the next four percent contributed on eligible compensation that non-union employees contribute and according to contract terms for union employees. Previously, we matched 100 percent of the first one percent contributed and 50 percent of the next five percent contributed on eligible compensation that non-union employees contribute. In response to the effects of COVID-19 on our business, we suspended the matching contribution from June 1, 2020 until December 31, 2020. In total, our matching contributions were $8.6 million in fiscal 2023, $7.7 million in fiscal 2022 and $3.5 million in fiscal 2021. Deferred Compensation Plan We maintain a plan that allows participants to defer compensation. The deferred compensation liability was $9.5 million and $12.5 million at February 25, 2023 and February 26, 2022, respectively. We have investments in corporate-owned life insurance policies (COLI) of $8.3 million and money market funds (classified as cash equivalents) of $0.3 million with the intention of utilizing them as long-term funding sources for this plan. The COLI assets are recorded at their net cash surrender values and are included in other non-current assets in the consolidated balance sheets. Plans under Collective Bargaining Agreements We contribute to a number of multi-employer union retirement plans, which provide retirement benefits to the majority of our union-represented employees; none of the plans are considered significant. However, the risks of participating in these multi-employer plans are different from single-employer plans in the following aspects: •Assets contributed to these plans by one employer may be used to provide benefits to employees of other participating employers •If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers •If we choose to stop participating in some of these plans, we may be required to pay those plans an amount based on the underfunded status of the plan, referred to as a withdrawal liability Our participation in these plans is outlined in the following table. The most recent Pension Protection Act zone status available in 2023 and 2022 relates to the plan years ending December 31, 2022 and December 31, 2021, respectively. The zone status is based on information that we have received from each plan, certified by an actuary. Among other factors, plans in the red zone are generally less than 65 percent funded, plans in the yellow zone are between 65 percent and 80 percent funded, and plans in the green zone are at least 80 percent funded.
|  |  |  | Pension Protection Act Zone Status |  | Contributions (In thousands) |  |  |  |  |  |  |  |
Pension Fund |  | EIN/Pension Plan Number |  | 2023 |  | 2022 |  | 2023 |  | 2022 |  | 2021 |  | FIP/RP Status Pending/Implemented |  | Minimum Contribution |  | Surcharge Imposed |  | Expiration Date of Collective Bargaining Agreement(1)
Iron Workers Local Union No. 5 and Iron Workers Employers Association Employees Pension Trust Fund |  | 521075473 |  | Green |  | Green |  | $ | 1,359 |  |  | $ | 1,454 |  |  | $ | 940 |  |  | No |  | No |  | No |  | 5/31/2017
International Painters and Allied Trades Industry Pension Fund |  | 526073909 |  | Red |  | Red |  | 869 |  |  | 932 |  |  | 525 |  |  | Implemented |  | No |  | No |  | 11/30/2017
Western Glaziers Retirement Plan (Washington) |  | 916123685 |  | Green |  | Green |  | 815 |  |  | 160 |  |  | 526 |  |  | No |  | No |  | No |  | 6/30/2017
Ironworkers Local 580 Shop Pension Fund |  | 136178514 |  | Green |  | Green |  | 596 |  |  | 31 |  |  | 26 |  |  | Implemented |  | No |  | Yes |  | 6/30/2023
Western Glaziers Retirement Fund (Oregon and Southwest Washington) |  | 936074376 |  | Green |  | Green |  | 441 |  |  | — |  |  | 51 |  |  | No |  | No |  | No |  | 11/30/2017
Iron Workers Mid-America Pension Fund |  | 366488227 |  | Green |  | Green |  | 429 |  |  | 431 |  |  | 767 |  |  | No |  | No |  | No |  | 5/31/2017
Glazier's Union Local 27 Pension and Retirement Plan |  | 366034076 |  | Green |  | Green |  | 174 |  |  | 290 |  |  | 165 |  |  | No |  | No |  | No |  | 5/31/2017
Atlanta Ironworkers Local Union 387 Pension Plan |  | 586051152 |  | Green |  | Green |  | 125 |  |  | 209 |  |  | 35 |  |  | No |  | No |  | No |  | 1/31/2017
Other funds |  |  |  |  |  |  |  | 442 |  |  | 422 |  |  | 423 |  |  |  |  |  |  |  |  |
Total contributions |  |  |  |  |  |  |  | $ | 5,250 |  |  | $ | 3,929 |  |  | $ | 3,458 |  |  |  |  |  |  |  |  |
(1) Plans include contributions required by collective bargaining agreements which have expired, but contain provisions automatically renewing their terms in the absence of a subsequent negotiated agreement.
The Company was listed in the plans' Forms 5500 as providing more than 5 percent of the total contributions for the following plans and plan years:
Pension Fund |  | Year contributions to Plan Exceeded More Than 5 Percent of Total Contributions
Iron Workers Local Union No. 5 and Iron Workers Employers Association Employees Pension Trust Fund |  | 2022, 2021 and 2020
Western Glaziers Retirement Plan (Washington) |  | 2022
Iron Workers Mid-America Pension Fund |  | 2022 and 2021
Iron Workers St. Louis District Council Pension Trust Fund |  | 2021
Atlanta Ironworkers Local Union 387 Pension Plan |  | 2022
Amounts contributed in fiscal 2023, 2022, and 2021 to defined contribution multiemployer plans were $2.2 million, $1.6 million and $1.1 million, respectively. Obligations and Funded Status of Defined-Benefit Pension Plans We sponsor the Tubelite Inc. Hourly Employees' Pension Plan, a defined-benefit pension plan that was frozen to new entrants in fiscal 2004, with no additional benefits accruing to plan participants after such time. We also sponsor an unfunded SERP, a defined-benefit pension plan that was frozen to new entrants in fiscal 2009, with no additional benefits accruing to plan participants after such time. The following tables present reconciliations of the benefit obligation and the funded status of these plans. The Tubelite plan uses a measurement date as of the calendar month-end closest to our fiscal year-end, while the SERP uses a measurement date aligned with our fiscal year-end.
(In thousands) |  | 2023 |  | 2022
Change in projected benefit obligation |  |  |  |
Benefit obligation beginning of period |  | $ | 12,405 |  |  | $ | 13,541 |
Interest cost |  | 380 |  |  | 339 |
Actuarial gain |  | (1,484) |  |  | (475) |
Benefits paid |  | (1,041) |  |  | (1,000) |
Benefit obligation at measurement date |  | 10,260 |  |  | 12,405 |
Change in plan assets |  |  |  |
Fair value of plan assets beginning of period |  | $ | 5,044 |  |  | $ | 5,551 |
Actual return on plan assets |  | (706) |  |  | (161) |
Company contributions |  | 695 |  |  | 654 |
Benefits paid |  | (1,041) |  |  | (1,000) |
Fair value of plan assets at measurement date |  | 3,992 |  |  | 5,044 |
Underfunded status |  | $ | (6,268) |  |  | $ | (7,361) |
The funded status was recognized in the consolidated balance sheets as follows:
(In thousands) |  | 2023 |  | 2022
Other non-current assets |  | $ | 161 |  |  | $ | 361 |
Current liabilities |  | (680) |  |  | (681) |
Other non-current liabilities |  | (5,749) |  |  | (7,041) |
Total |  | $ | (6,268) |  |  | $ | (7,361) |
The following was included in accumulated other comprehensive loss and has not yet been recognized as a component of net periodic benefit cost:
(In thousands) |  | 2023 |  | 2022
Net actuarial loss |  | $ | 3,968 |  |  | $ | 4,916 |
The net actuarial gain recognized in comprehensive earnings, net of tax expense, was $0.7 million in fiscal 2023, and $0.4 million in fiscal 2022. Components of the defined-benefit pension plans' net periodic benefit cost:
(In thousands) |  | 2023 |  | 2022 |  | 2021
Interest cost |  | $ | 380 |  |  | $ | 339 |  |  | $ | 346 |
Expected return on assets |  | (84) |  |  | (85) |  |  | (211) |
Amortization of unrecognized net loss |  | 254 |  |  | 270 |  |  | 260 |
Net periodic benefit cost |  | $ | 550 |  |  | $ | 524 |  |  | $ | 395 |
Total net periodic pension benefit cost is expected to be approximately $0.6 million in fiscal 2024. The estimated net actuarial gain for the defined-benefit pension plans that will be amortized from accumulated other comprehensive loss into net periodic benefit cost for fiscal 2024 is $0.3 million, net of tax expense. Additional Information Assumptions
Benefit Obligation Weighted-Average Assumptions |  | 2023 |  | 2022 |  | 2021
Discount rate |  | 5.10 | % |  | 3.20 | % |  | 2.60 | %
Net Periodic Benefit Expense Weighted-Average Assumptions |  | 2023 |  | 2022 |  | 2021
Discount rate |  | 3.20 | % |  | 2.60 | % |  | 2.50 | %
Expected long-term rate of return on assets |  | 2.75 | % |  | 2.50 | % |  | 4.50 | %
Discount rate. The discount rate reflects the current rate at which the defined-benefit plans' pension liabilities could be effectively settled at the end of the year based on the measurement date. The discount rate was determined by matching the expected benefit payments to payments from the Principal Discount Yield Curve. There are no known or anticipated changes in the discount rate assumption that will have a significant impact on pension expense in fiscal 2024. Expected return on assets. To develop the expected long-term rate of return on assets, we considered historical long-term rates of return achieved by the plan investments, the plan's investment strategy, and current and projected market conditions. During fiscal 2019, the assets of the Tubelite plan were moved from investment in a short-term bond fund to various duration fixed income funds. The investments are carried at fair value based on prices from recent trades of similar securities, which would be classified as Level 2 in the valuation hierarchy. We do not maintain assets intended for the future use of the SERP. Contributions Company contributions to the plans for fiscal 2023 and fiscal 2022 were $0.7 million in each year, which equaled or exceeded the minimum funding requirements. Estimated Future Benefit Payments The following benefit payments, which reflect expected future service, are expected to be paid by the plans:
(In thousands) |  | 2024 |  | 2025 |  | 2026 |  | 2027 |  | 2028 |  | 2029-2033
Estimated future benefit payments |  | $ | 1,050 |  |  | $ | 998 |  |  | $ | 967 |  |  | $ | 927 |  |  | $ | 898 |  |  | $ | 3,912 |

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