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Retirement Plans | 12 Months Ended
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Dec. 31, 2023
Retirement Benefits [Abstract] |
Retirement Plans | Retirement Plans The Company has three retirement plans that cover its hourly and salaried employees in the US: one defined benefit plan, which is frozen, and two defined contribution plans. Employees are eligible to participate in the appropriate plan based on employment classification. The Company’s contributions to the defined benefit and defined contribution plans are governed by the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and the Company’s policy and investment guidelines of the applicable plan. The Company’s policy is to contribute at least the required minimum in accordance with the funding standards of ERISA. The Company maintains one defined contribution plans for its employees in Canada. In the United Kingdom, the Company maintains two defined contribution plans and a defined benefit plan, which is frozen. These plans are discussed in further detail below. United States Defined Benefit Plan The following tables present a reconciliation of the changes in the benefit obligation, the fair market value of the assets, and the funded status of the plan, as of December 31, 2023 and 2022:
|  | December 31,
|  | 2023 |  | 2022
Changes in benefit obligation: |  |  |  |
Benefit obligation at beginning of year |  | $ | 6,101 |  |  | $ | 7,875 |
Interest cost |  | 286 |  |  | 194 |
Actuarial gain |  | (23) |  |  | (1,544) |
Benefits paid |  | (455) |  |  | (424) |
Benefit obligation at end of year |  | $ | 5,909 |  |  | $ | 6,101 |
Change to plan assets: |  |  |  |
Fair value of assets at beginning of year |  | $ | 3,792 |  |  | $ | 4,767 |
Actual gain (loss) on plan assets |  | 310 |  |  | (1,007) |
Employer contribution |  | 276 |  |  | 456 |
Benefits paid |  | (455) |  |  | (424) |
Fair value of assets at end of year |  | 3,923 |  |  | 3,792 |
Funded status at end of year |  | $ | (1,986) |  |  | $ | (2,309) |
Amounts recognized in the consolidated balance sheets consist of: |  |  |  |
Other long-term liabilities |  | $ | (1,986) |  |  | $ | (2,309) |
Amounts recognized in accumulated other comprehensive loss consist of: |  |  |  |
Net loss |  | $ | 1,598 |  |  | $ | 1,737 |
The actuarial loss included in accumulated other comprehensive loss that will be recognized in net periodic pension cost during 2024 is $52, before taxes. Net periodic pension costs for the years ended December 31, 2023 and 2022 were as follows:
|  | Year Ended December 31,
|  | 2023 |  | 2022 |  |
Components of net periodic benefit cost: |  |  |  |  |  |
Interest cost |  | $ | 286 |  |  | $ | 194 |  |  |
Expected return on plan assets |  | (256) |  |  | (264) |  |  |
Recognized net actuarial loss |  | 62 |  |  | 71 |  |  |
Net periodic pension cost |  | $ | 92 |  |  | $ | 1 |  |  |
The weighted average assumptions in the following table represent the rates used to develop the actuarial present value of the projected benefit obligation for the year listed and also the net periodic benefit cost for the following year.
|  | Year Ended December 31,
|  | 2023 |  | 2022 |  |
Discount rate |  | 4.9 | % |  | 2.6 | % |  |
Expected rate of return on plan assets |  | 7.0 | % |  | 5.6 | % |  |
The expected long-term rate of return is based on numerous factors, including the target asset allocation for plan assets, historical rate of return, long-term inflation assumptions, and current and projected market conditions. Amounts applicable to the Company’s pension plan with accumulated benefit obligations in excess of plan assets were as follows as of December 31, 2023 and 2022:
|  | December 31,
|  | 2023 |  | 2022
Projected benefit obligation |  | $ | 5,909 |  |  | $ | 6,101 |
Accumulated benefit obligation |  | 5,909 |  |  | 6,101 |
Fair value of plan assets |  | 3,923 |  |  | 3,792 |
Plan assets consist primarily of various fixed income and equity investments. The Company’s primary investment objective is to provide long-term growth of capital while accepting a moderate level of risk. The investments are limited to cash and cash equivalents, bonds, preferred stocks, and common stocks. The investment target ranges and actual allocation of pension plan assets by major category as of December 31, 2023 and 2022 were as follows:
|  |  |  | December 31,
|  | Target |  | 2023 |  | 2022
Asset Category |  |  |  |  |  |
Cash and cash equivalents |  | 0 - 20% |  | 4 | % |  | 6 | %
Total fixed income funds |  | 25 - 50% |  | 33 |  |  | 7 |
Total mutual funds and equities |  | 35 - 70% |  | 63 |  |  | 87 |
Total |  |  |  | 100 | % |  | 100 | %
In accordance with the fair value disclosure requirements of ASC 820, the following assets were measured at fair value on a recurring basis as of December 31, 2023 and 2022. Additional information regarding ASC 820 and the fair value hierarchy can be found in Note 16.
|  | December 31,
|  | 2023 |  | 2022
Asset Category |  |  |  |
Cash and cash equivalents |  | $ | 160 |  |  | $ | 222 |
Fixed income funds |  |  |  |
Corporate bonds |  | 845 |  |  | 795 |
Total fixed income funds |  | 845 |  |  | 795 |
Equity funds and equities |  |  |  |
Mutual funds |  | — |  |  | 247 |
Exchange-traded funds |  | 2,918 |  |  | 2,528 |
Total mutual funds and equities |  | 2,918 |  |  | 2,775 |
Total |  | $ | 3,923 |  |  | $ | 3,792 |
Cash equivalents: The Company uses quoted market prices to determine the fair value of these investments in interest-bearing cash accounts and they are classified as Level 1 of the fair value hierarchy. The carrying amounts approximate fair value because of the short maturity of the instruments. Fixed income funds: Investments within the fixed income funds category consist of fixed income corporate debt. The Company uses quoted market prices to determine the fair values of these fixed income funds. These instruments consist of exchange-traded government and corporate bonds and are classified as Level 1 of the fair value hierarchy. Equity funds and equities: The valuation of investments in registered investment companies is based on the underlying investments in securities. Securities traded on security exchanges are valued at the latest quoted sales price. Securities traded in the over-the-counter market and listed securities for which no sale was reported on that date are valued at the average of the last reported bid and ask quotations. These investments are classified as Level 1 of the fair value hierarchy. The Company currently anticipates contributions of $370 to its US defined benefit plan in 2024. The following benefit payments are expected to be paid during the years indicated:
Year Ending December 31, |  |
2024 |  | $ | 491 |
2025 |  | 483 |
2026 |  | 478 |
2027 |  | 468 |
2028 |  | 455 |
Years 2029-2033 |  | 2,105 |
United Kingdom Defined Benefit Plan The Company’s UK defined benefit plan covers certain current employees, former employees, and retirees. The plan has been frozen to new entrants since April 1, 1997 and also covers the former employees of a merged plan after January 2002. Benefits under the plan were based on years of service and eligible compensation during defined periods of service. The Company’s funding policy for the plan is to make minimum annual contributions required by applicable regulations. The funded status of the United Kingdom defined benefit plan as of December 31, 2023 and 2022 was as follows:
|  | December 31,
|  | 2023 |  | 2022
Changes in benefit obligation: |  |  |  |
Benefit obligation at beginning of year |  | $ | 4,671 |  |  | $ | 9,135 |
Interest cost |  | 229 |  |  | 135 |
Actuarial gain |  | 154 |  |  | (2,221) |
Benefits paid |  | (292) |  |  | (1,424) |
Foreign currency exchange rate changes |  | 249 |  |  | (954) |
Benefit obligation at end of year |  | $ | 5,011 |  |  | $ | 4,671 |
Change to plan assets: |  |  |  |
Fair value of assets at beginning of year |  | $ | 5,745 |  |  | $ | 8,409 |
Actual gain (loss) on plan assets |  | 323 |  |  | (742) |
Employer contribution |  | 318 |  |  | 319 |
Benefits paid |  | (292) |  |  | (1,363) |
Foreign currency exchange rate changes |  | 305 |  |  | (878) |
Fair value of assets at end of year |  | 6,399 |  |  | 5,745 |
Funded status at end of year |  | $ | 1,388 |  |  | $ | 1,074 |
Amounts recognized in the consolidated balance sheets consist of: |  |  |  |
Other assets |  | $ | 1,388 |  |  | $ | 1,074 |
Amounts recognized in accumulated other comprehensive loss consist of: |  |  |  |
Net gain |  | $ | (567) |  |  | $ | (1,425) |
Prior service cost |  | 71 |  |  | 90 |
Total |  | $ | (496) |  |  | $ | (1,335) |
Net periodic pension costs for the years ended December 31, 2023 and 2022 were as follows:
|  | Year Ended December 31,
|  | 2023 |  | 2022 |  |
Components of net periodic benefit gain: |  |  |  |  |  |
Interest cost |  | $ | 229 |  |  | $ | 135 |  |  |
Expected return on plan assets |  | (346) |  |  | (264) |  |  |
Amortization of prior service cost |  | 24 |  |  | 23 |  |  |
Recognized net actuarial loss |  | 18 |  |  | 13 |  |  |
Net periodic pension gain |  | $ | (75) |  |  | $ | (93) |  |  |
The weighted average assumptions in the following table represent the rates used to develop the actuarial present value of the projected benefit obligation for the year listed and also the net periodic benefit cost for the following year.
|  | Year Ended December 31,
|  | 2023 |  | 2022 |  |
Discount rate |  | 4.5 | % |  | 4.8 | % |  |
Expected rate of return on plan assets |  | 6.0 | % |  | 5.7 | % |  |
Amounts applicable to the Company’s pension plans with accumulated benefit obligations in excess of plan assets were as follows as of December 31, 2023 and 2022:
|  | December 31,
|  | 2023 |  | 2022
Projected benefit obligation |  | $ | 5,011 |  |  | $ | 4,671 |
Accumulated benefit obligation |  | 5,011 |  |  | 4,671 |
Fair value of plan assets |  | 6,399 |  |  | 5,745 |
The Company has estimated the long-term rate of return on plan assets based primarily on historical returns on plan assets, adjusted for changes in target portfolio allocations, and recent changes in long-term interest rates based on publicly available information. Plan assets are invested by the trustees in accordance with a written statement of investment principles. This statement permits investment in equities, corporate bonds, United Kingdom government securities, commercial property, and cash, based on certain target allocation percentages. Asset allocation is primarily based on a strategy to provide steady growth without undue fluctuations. The target asset allocation percentages for 2023 were as follows:
Equity securities |  | Up to 100%
Commercial property |  | Not to exceed 50%
UK Government securities |  | Not to exceed 50%
Cash |  | Up to 100%
Plan assets held within the United Kingdom defined benefit plan consist of cash and equity securities that have been classified as Level 1 of the fair value hierarchy. All other plan assets have been classified as Level 2 of the fair value hierarchy. The plan assets by category for the years ended December 31, 2023 and 2022 were as follows:
|  | December 31,
|  | 2023 |  | 2022
Asset Category |  |  |  |
Cash and cash equivalents |  | $ | 127 |  |  | $ | 540 |
Equity securities |  | 3,676 |  |  | 2,530 |
Bonds |  | 1,693 |  |  | 2,296 |
Other |  | 903 |  |  | 379 |
Total |  | $ | 6,399 |  |  | $ | 5,745 |
United Kingdom regulations require trustees to adopt a prudent approach to funding required contributions to defined benefit pension plans. The Company anticipates making contributions of $318 to the United Kingdom defined benefit plan during 2024. The following estimated future benefits payments are expected to be paid under the United Kingdom defined benefit plan:
Year Ending December 31, |  |
2024 |  | $ | 308 |
2025 |  | 318 |
2026 |  | 325 |
2027 |  | 331 |
2028 |  | 337 |
Years 2029-2033 |  | 1,497 |
Defined Contribution Plans The Company sponsors five defined contribution plans for hourly and salaried employees across its domestic and international facilities. The following table summarizes the expense associated with the contributions made to these plans.
|  | Year Ended December 31,
|  | 2023 |  | 2022 |  |
United States |  | $ | 2,841 |  |  | $ | 1,650 |  |  |
Canada |  | 114 |  |  | 131 |  |  |
United Kingdom |  | 1,178 |  |  | 817 |  |  |
|  | $ | 4,133 |  |  | $ | 2,598 |  |  |

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