Pensions and Postretirement Benefits Other than Pensions

The Company sponsors several U.S. defined benefit and defined contribution plans covering substantially all of our U.S. employees. Additionally, the Company has many non-U.S. defined benefit and defined contribution plans covering eligible non-U.S. employees. Postretirement benefits other than pensions (OPEB), provide healthcare benefits, and in some instances, life insurance benefits for certain eligible retired employees.

Pension Plans

The noncontributory defined benefit pension plans covering non-collectively bargained U.S. employees provide benefits on an average pay formula while most plans for collectively bargained U.S. employees provide benefits on a flat dollar benefit formula. The non-U.S. pension plans generally provide benefits based on earnings and years of service. The Company also maintains additional other supplemental plans for officers and other key employees.

In connection with the spin-off, the Company transferred its obligations for pension benefits for all current and former employees of the commercial and residential security businesses to Allegion. The transfer of these obligations reduced our pension liabilities by $631.1 million, pension assets by $543.5 million, and accumulated other comprehensive losses by $164.8 million.

The components of the Company’s net periodic pension benefit costs for the three months ended March 31 were as follows:



	Three months ended
In millions	2014			2013
Service cost	$	17.3		$	23.1
Interest cost	36.9			39.2
Expected return on plan assets	(39.2		)	(42.0		)
Net amortization of:
Prior service costs	1.1			1.2
Plan net actuarial losses	9.0			15.5
Net periodic pension benefit cost	25.1			37.0
Amounts recorded in continuing operations	$	23.3		$	29.7
Amounts recorded in discontinued operations	1.8			7.3
Total	$	25.1		$	37.0

The Company made required and discretionary employer contributions of $11.4 million and $6.8 million to its defined benefit pension plans during the three months ended March 31, 2014 and 2013, respectively. The Company currently projects that it will contribute approximately $130.8 million to its plans worldwide in 2014.

Postretirement Benefits Other Than Pensions

The Company sponsors several postretirement plans that provide for healthcare benefits, and in some instances, life insurance benefits that cover certain eligible retired employees. The Company funds postretirement benefit obligations principally on a pay as you go basis. Generally, postretirement health benefits are contributory with contributions adjusted annually. Life insurance plans for retirees are primarily noncontributory.

In connection with the spin-off, the Company transferred its obligations for post retirement benefits other than pensions for all current and former employees of the commercial and residential security businesses to Allegion. The transfer of these obligations reduced our post retirement plan liabilities by $14.1 million, and increased our accumulated other comprehensive income by $5.6 million.

The components of net periodic postretirement benefit cost for the three months ended March 31 were as follows:



	Three months ended
In millions	2014			2013
Service cost	$	1.3		$	1.7
Interest cost	7.3			6.7
Net amortization of:
Prior service gains	(2.2		)	(2.6		)
Net actuarial losses	—			2.7
Net periodic postretirement benefit cost	$	6.4		$	8.5
Amounts recorded in continuing operations	$	4.2		$	5.3
Amounts recorded in discontinued operations	2.2			3.2
Total	$	6.4		$	8.5