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Note 6 - Pension, Postretirement and Postemployment Defined Benefit Plans
 3 Months Ended
Dec. 27, 2020
Pension Plan [Member]  
Notes to Financial Statements  
Retirement Benefits [Text Block]

6

PENSION, POSTRETIREMENT AND POSTEMPLOYMENT DEFINED BENEFIT PLANS

 

We have several noncontributory defined benefit pension plans that together cover selected employees. Benefits under the plans were generally based on salary and years of service. With the exception of defined benefit plans acquired in the Transactions, effective in 2012, substantially all benefits are frozen. Our liability and related expense for benefits under the plans are recorded over the service period of employees based upon annual actuarial calculations. Plan funding strategies are influenced by government regulations. Plan assets consist primarily of domestic and foreign corporate equity securities, government and corporate bonds, hedge fund investments and cash.

 

We provide retiree medical and life insurance benefits under postretirement plans at several of our operating locations. The level and adjustment of participant contributions vary depending on the specific plan. In addition, St. Louis Post-Dispatch LLC, provides postemployment disability benefits to certain employee groups prior to retirement. Our liability and related expense for benefits under the postretirement plans are recorded over the service period of active employees based upon annual actuarial calculations. We accrue postemployment disability benefits when it becomes probable that such benefits will be paid and when sufficient information exists to make reasonable estimates of the amounts to be paid.

 

As part of the Transactions, the Company assumed several non-contributory defined benefit pension plans that together cover selected employees. Benefits under the plans are generally based on salary and years of service. The liability and related expense for benefits under the plans are recorded over the service period of employees based upon annual actuarial calculations. Plan funding strategies are influenced by government regulations. Plan assets consist primarily of domestic corporate equity securities, government and corporate bonds, money markets and deposits with insurance companies. The amount of net pension obligations for those plans as of March 16, 2020, the initial measurement date, was $43,503,000.

 

Additionally, as part of the Transactions, the Company assumed certain unfunded postemployment benefit plans which provide coverage to retirees for portions of premiums associated with medical, dental, life, and vision insurance benefits in eight collective bargaining units. The amount of premiums paid in five bargaining units are capped at specific dollar amounts per month. The amount of premiums paid in three bargaining units are uncapped. The plan groups consist of capped retirees, uncapped retirees, capped active employees, and uncapped active employees. New participants in the uncapped plans are eligible for Medicare supplemental medical insurance. The total postemployment benefit obligation recognized for these plans as of March 16, 2020, the initial measurement date, was $36,800,000.

 

During the 13 weeks ended December 27, 2020 we notified certain participants in our post employment benefit plans of changes to be made to the plans, including elimination of coverage for certain participants. The changes resulted in a non-cash curtailment gain of $23,830,000 and a reduction in our benefit obligation liability by $23,830,000. This is recorded within Curtailment gain and Postretirement and postemployment benefit obligations.

 

Multiemployer Pension Plans

 

During the 13 weeks ended December 27, 2020, we withdrew from a multiemployer pension plan and recorded a $12,310,000 million liability reflecting an estimate of the withdrawal from the fund. The withdrawal liability is recorded in Warrants and other and the expense is included within Pension withdrawal cost. The estimate will be finalized upon receipt of the final assessment. The liability will be paid over 20 years.

 

We use a fiscal year end measurement date for all of our Pension and postretirement medical plan obligations.

 

The net periodic pension and postretirement cost (benefit) components for our plans are as follows:

 

PENSION PLANS

 

13 Weeks Ended

 
  

December 27,

  

December 29,

 

(Thousands of Dollars)

 

2020

  

2019

 
         

Service cost for benefits earned during the period

  633   8 

Interest cost on projected benefit obligation

  1,787   1,231 

Expected return on plan assets

  (4,672)  (1,951)

Amortization of net loss

  1,004   792 

Amortization of prior service benefit

  —   (2)

Pension benefit

  (1,248)  78 

 

POSTRETIREMENT MEDICAL PLANS

 

13 Weeks Ended

 
  

December 27,

  

December 29,

 

(Thousands of Dollars)

 

2020

  

2019

 
         

Service cost for benefits earned during the period

  210   — 

Interest cost on projected benefit obligation

  123   67 

Expected return on plan assets

  (252)  (265)

Amortization of net gain

  (172)  (186)

Amortization of prior service benefit

  (161)  (161)
Curtailment gain  (23,830)  — 

Postretirement medical benefit

  (24,082)  (545)

 

In the 13 weeks ended December 27, 2020 we contributed $400,000 to our pension plans. Based on our forecast at December 27, 2020, we expect to make contributions of $2,790,000 to our pension trust during the remainder of fiscal 2021.