Pension and Other Postretirement Benefits (Tables)

12 Months Ended

Dec. 31, 2021

Summary of Information in Curtailment or Settlement of Benefits Requiring Remeasurement, Update to Discount Rates Used to Determine Benefit Obligations of Affected Plans

The following table presents certain information and the financial impacts of these actions on the accompanying Consolidated Financial Statements:

Action #	Number of affected plan participants	Weighted average discount rate as of prior plan remeasurement date	Plan remeasurement date	Weighted average discount rate as of plan remeasurement date	Increase (decrease) to accrued pension benefits liability			Decrease to accrued other postretirement benefits liability			Curtailment gain⁽¹⁾			Settlement charge⁽¹⁾
1	~840	2.45%	March 31, 2021	3.06%	$	—		$	(106	)	$	(17	)	$	26
2	~120	2.38%	June 30, 2021	2.71%		(90	)		—			—			39
3	~20	2.71%	September 30, 2021	2.74%		7			—			—			7
4	~20	1.34%	September 30, 2021	1.53%		(38	)		—			—			1
5	~800	N/A	N/A	N/A	N/A				—			—			63
6	~14,000	2.59%	November 30, 2021	2.79%		(84	)		—			—			848
7	~60	2.59%	November 30, 2021	2.79%		(1	)		—			—			10
					$	(206	)	$	(106	)	$	(17	)	$	994

⁽¹⁾

These amounts primarily represent the accelerated amortization of a portion of the existing prior service benefit for curtailments and net actuarial loss for settlements and were reclassified from Accumulated other comprehensive loss to Restructuring and other charges, net (see Note D) on the accompanying Statement of Consolidated Operations.

The following table presents certain information and the financial impacts of these actions on the accompanying Consolidated Financial Statements:

Action #	Number of affected plan participants	Weighted average discount rate as of December 31, 2019	Plan remeasurement date	Weighted average discount rate as of plan remeasurement date	Increase (decrease) to accrued pension benefits liability⁽¹⁾			Increase to accrued other postretirement benefits liability⁽¹⁾		Curtailment charge (gain)⁽²⁾			Settlement charge⁽²⁾
1	~20	3.15%	January 31, 2020	2.75%	$	18		$	—	$	1		$	—
2	~430	3.20%	January 31, 2020	2.75%		28		—			2			—
3a	~300	3.25%	April 30, 2020	2.92%		156		—			1			—
3b	~600	3.75%	April 30, 2020	3.44%	—			—			(2	)		—
4	~8,600	3.11%	August 31, 2020	2.65%		—			74		—			—
5	~430	N/A	December 31, 2020	N/A		(2	)		—		—			44
6	~900	N/A	December 31, 2020	N/A		5			—		5			—
	~11,280				$	205		$	74	$	7		$	44

⁽¹⁾	Actions 1-4 caused interim plan remeasurements, including an update to the discount rates used to determine the benefit obligations of the affected plans. These amounts include the impacts due to the interim plan remeasurements.

⁽²⁾

These amounts primarily represent the accelerated amortization of a portion of the existing prior service cost or benefit for curtailments and net actuarial loss for settlements and were reclassified from Accumulated other comprehensive loss to Restructuring and other charges, net (see Note D) on the accompanying Statement of Consolidated Operations.

Schedule of Obligations and Funded Status

Obligations and Funded Status

	Pension benefits						Other postretirement benefits
December 31,	2021			2020			2021			2020
Change in benefit obligation
Benefit obligation at beginning of year	$	6,904		$	6,532		$	892		$	848
Service cost		22			56			4			5
Interest cost		120			168			15			19
Amendments		—			1			—			(19	)
Actuarial losses (gains)		(305	)		578			(78	)		133
Settlements		(1,763	)		(127	)		—			—
Curtailments		—			6			—			(1	)
Benefits paid, net of participants’ contributions		(362	)		(381	)		(56	)		(100	)
Medicare Part D subsidy receipts		—			—			2			7
Divestitures		—			(2	)		(69	)		—
Foreign currency translation impact		(22	)		73			—			—
Benefit obligation at end of year	$	4,594		$	6,904		$	710		$	892
Change in plan assets
Fair value of plan assets at beginning of year	$	5,356		$	5,015		$	—		$	—
Actual return on plan assets		513			455			—			—
Employer contributions		581			347			—			—
Participant contributions		5			10			—			—
Benefits paid		(356	)		(379	)		—			—
Administrative expenses		(4	)		(24	)		—			—
Settlements		(1,763	)		(127	)		—			—
Divestitures		—			(2	)		—			—
Foreign currency translation impact		(26	)		61			—			—
Fair value of plan assets at end of year	$	4,306		$	5,356		$	—		$	—
Funded status	$	(288	)	$	(1,548	)	$	(710	)	$	(892	)
Less: Amounts attributed to joint venture partners		(25	)		(45	)		—			—
Net funded status	$	(263	)	$	(1,503	)	$	(710	)	$	(892	)
Amounts recognized in the Consolidated Balance Sheet consist of:
Noncurrent assets	$	164		$	—		$	—		$	—
Current liabilities		(10	)		(11	)		(60	)		(65	)
Noncurrent liabilities		(417	)		(1,492	)		(650	)		(744	)
Liabilities held for sale		—			—			—			(83	)
Net amount recognized	$	(263	)	$	(1,503	)	$	(710	)	$	(892	)
Amounts recognized in Accumulated Other Comprehensive Loss consist of:
Net actuarial loss	$	1,877		$	3,563		$	253		$	374
Prior service cost (benefit)		2			2			(125	)		(156	)
Total, before tax effect		1,879			3,565			128			218
Less: Amounts attributed to joint venture partners		38			57			—			—
Net amount recognized, before tax effect	$	1,841		$	3,508		$	128		$	218
Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income (Loss) consist of:
Net actuarial loss (benefit)	$	(527	)	$	462		$	(74	)	$	133
Amortization of accumulated net actuarial loss		(1,159	)		(263	)		(47	)		(20	)
Prior service cost (benefit)		—			1			—			(19	)
Amortization of prior service (cost) benefit		—			(4	)		31			17
Total, before tax effect		(1,686	)		196			(90	)		111
Less: Amounts attributed to joint venture partners		(19	)		15			—			—
Net amount recognized, before tax effect	$	(1,667	)	$	181		$	(90	)	$	111

Schedule of Pension Plan Benefit Obligations

Pension Plan Benefit Obligations

	Pension benefits
	2021		2020
The aggregate projected benefit obligation and accumulated benefit obligation for all defined benefit pension plans was as follows:
Projected benefit obligation	$	4,594	$	6,904
Accumulated benefit obligation		4,438		6,702
The aggregate projected benefit obligation and fair value of plan assets for pension plans with projected benefit obligations in excess of plan assets was as follows:
Projected benefit obligation		3,031		6,813
Fair value of plan assets		2,579		5,267
The aggregate accumulated benefit obligation and fair value of plan assets for pension plans with accumulated benefit obligations in excess of plan assets was as follows:
Accumulated benefit obligation		2,918		6,210
Fair value of plan assets		2,579		4,805

Components of Net Periodic Benefit Cost

	Pension benefits⁽¹⁾									Other postretirement benefits
	2021			2020			2019			2021			2020			2019
Service cost	$	22		$	54		$	48		$	4		$	5		$	4
Interest cost⁽²⁾		116			164			221			15			19			36
Expected return on plan assets⁽²⁾		(281	)		(292	)		(325	)		—			—			—
Recognized net actuarial loss⁽²⁾		190			212			171			21			20			10
Amortization of prior service cost (benefit)⁽²⁾		—			—			4			(14	)		(15	)		—
Settlements⁽³⁾		968			51			73			26			—			8
Curtailments⁽⁴⁾		—			9			38			(17	)		(2	)		—
Net periodic benefit cost⁽⁵⁾	$	1,015		$	198		$	230		$	35		$	27		$	58

⁽¹⁾	In 2021, 2020, and 2019, net periodic benefit cost for U.S pension plans was $962, $154, and $155, respectively.

⁽²⁾	These amounts were reported in Other (income) expenses, net on the accompanying Statement of Consolidated Operations.

⁽³⁾

These amounts were reported in Restructuring and other charges, net on the accompanying Statement of Consolidated Operations (see Note D). In 2021, settlements were due to management actions (see Plan Actions above). In 2020, settlements were due to management actions (see Plan Actions above) ($44) and payment of additional lump sum benefits ($7). In 2019, settlements were due to management actions (see Plan Actions above) ($74) and payment of additional lump sum benefits ($7).

⁽⁴⁾	These amounts were reported in Restructuring and other charges, net on the accompanying Statement of Consolidated Operations (see Note D). In 2021, 2020, and 2019, curtailments were due to management actions (see Plan Actions above).

⁽⁵⁾	Amounts attributed to joint venture partners are not included.

Schedule of Assumed Health Care Cost Trend Rates

Assumed health care cost trend rates for U.S. other postretirement benefit plans were as follows (non-U.S. plans are not material):

	2021			2020			2019
Health care cost trend rate assumed for next year		5.5	%		5.5	%		5.5	%
Rate to which the cost trend rate gradually declines		4.5	%		4.5	%		4.5	%
Year that the rate reaches the rate at which it is assumed to remain	2026			2026			2023

Schedule of Pension and Postretirement Plans Weighted Average Target and Actual Asset Allocations (Detail)

Plan Assets. Alcoa’s pension plan weighted average target and actual asset allocations at December 31, 2021 and 2020, by asset class, were as follows:

	Target asset allocation						Plan assets at December 31,
Asset class	2021			2020			2021			2020
Equities		25	%		30	%		28	%		39	%
Fixed income		65			50			64			50
Other investments		10			20			8			11
Total		100	%		100	%		100	%		100	%

Schedule of Fair Value of Pension Plan Assets

The following table presents the fair value of pension plan assets classified under either the appropriate level of the fair value hierarchy or net asset value:

December 31, 2021	Level 1		Level 2		Level 3		Net Asset Value		Total
Equities:
Equity securities	$	210	$	—	$	—	$	671	$	881
Long/short equity hedge funds		—		—		—		4		4
Private equity		—		—		—		281		281
	$	210	$	—	$	—	$	956	$	1,166
Fixed income:
Intermediate and long-duration government/credit	$	827	$	1,027	$	—	$	651	$	2,505
Cash and cash equivalent funds		64		—		—		172		236
Other		—		—		—		—		-
	$	891	$	1,027	$	—	$	823	$	2,741
Other investments:
Real estate	$	63	$	—	$	—	$	263	$	326
Other		—		—		—		31		31
	$	63	$	—	$	—	$	294	$	357
Total⁽¹⁾	$	1,164	$	1,027	$	—	$	2,073	$	4,264
December 31, 2020	Level 1		Level 2		Level 3		Net Asset Value		Total
Equities:
Equity securities	$	379	$	—	$	—	$	1,469	$	1,848
Long/short equity hedge funds		—		—		—		5		5
Private equity		—		—		—		207		207
	$	379	$	—	$	—	$	1,681	$	2,060
Fixed income:
Intermediate and long-duration government/credit	$	925	$	794	$	—	$	619	$	2,338
Cash and cash equivalent funds		165		—		—		189		354
Other		—		2		—		—		2
	$	1,090	$	796	$	—	$	808	$	2,694
Other investments:
Real estate	$	284	$	—	$	—	$	273	$	557
Other		—		—		—		37		37
	$	284	$	—	$	—	$	310	$	594
Total⁽²⁾	$	1,753	$	796	$	—	$	2,799	$	5,348

⁽¹⁾	As of December 31, 2021, the total fair value of pension plan assets excludes a net receivable of $42, which represents securities not yet settled plus interest and dividends earned on various investments.

⁽²⁾	As of December 31, 2020, the total fair value of pension plan assets excludes a net receivable of $8, which represents securities not yet settled plus interest and dividends earned on various investments.

Schedule of Benefit Payments Expected to be Paid

Benefit payments expected to be paid to pension and other postretirement benefit plan participants are as follows:

Year ending December 31,	Pension benefits		Other postretirement benefits
2022	$	285	$	60
2023		280		55
2024		285		55
2025		285		50
2026		285		50
2027 through 2031		1,365		215
	$	2,785	$	485

Benefit Obligation [Member]

Schedule of Weighted Average Assumptions Used to Determine Benefit Obligations and Net Periodic Benefit Cost

Assumptions. Weighted average assumptions used to determine benefit obligations for pension and other postretirement benefit plans were as follows:

December 31,	2021			2020
Discount rate—pension plans		2.99	%		2.41	%
Discount rate—other postretirement benefit plans		2.82			2.41
Rate of compensation increase—pension plans		3.11			2.58

Net Periodic Benefit Cost [Member]

Schedule of Weighted Average Assumptions Used to Determine Benefit Obligations and Net Periodic Benefit Cost

Weighted average assumptions used to determine net periodic benefit cost for pension and other postretirement benefit plans were as follows:

	2021			2020			2019
Discount rate—pension plans		1.91	%		3.02	%		3.89	%
Discount rate—other postretirement benefit plans		1.99			2.84			3.94
Expected long-term rate of return on plan assets—pension plans		5.66			6.28			6.59
Rate of compensation increase—pension plans		2.58			3.25			3.26