Employee Benefit Plans

3 Months Ended

Mar. 27, 2015

Compensation and Retirement Disclosure [Abstract]

Employee Benefit Plans

Employee Benefit Plans

The Company sponsors defined benefit pension plans principally for salaried, management personnel.  For employees hired prior to January 1, 2003, the plans provide eligible employees with retirement benefits based predominantly on years of service and compensation rates near retirement.  For employees hired in 2003 or thereafter, benefits are determined based on a cash balance formula, which provides benefits by utilizing interest and pay credits based upon age, service and compensation. 

In addition to these plans, the Company sponsors a post-retirement medical plan and a life insurance plan that provide benefits to full-time, salaried, management employees, hired prior to January 1, 2003, upon their retirement if certain eligibility requirements are met.  Medicare-eligible retirees are covered by a health reimbursement arrangement, which is an employer-funded account that can be used for reimbursement of eligible medical expenses. Non-Medicare eligible retirees are covered by a self-insured program partially funded by participating retirees.  The life insurance plan is non-contributory.

The Company engages independent actuaries to compute the amounts of liabilities and expenses relating to these plans subject to the assumptions that the Company selects.  These amounts are reviewed by management.  The following table describes the components of expense / (income) related to net benefit expense recorded in labor and fringe on the income statement.

NOTE 6.    Employee Benefit Plans, continued

	Pension Benefits
(Dollars in millions)	First Quarters
	2015			2014
Service Cost	$	11		$	11
Interest Cost	29			31
Expected Return on Plan Assets	(40		)	(41		)
Amortization of Net Loss	17			14
Net Periodic Benefit Cost	17			15
Special Termination Benefits - Workforce Reduction Program(a)	7			—
Total Expense	$	24		$	15
	Other Post-retirement Benefits
(Dollars in millions)	First Quarters
	2015			2014
Service Cost	$	1		$	1
Interest Cost	4			3
Amortization of Net Loss	1			1
Total Expense	$	6		$	5

(a) These charges result from a management workforce reduction program that was initiated in 2014 and was completed during the first quarter 2015.

Qualified pension plan obligations are funded in accordance with regulatory requirements and with an objective of meeting minimum funding requirements necessary to avoid restrictions on flexibility of plan operation and benefit payments.  No significant contributions to the Company's qualified pension plans are expected in 2015.