Pension Expense

12 Months Ended

Jun. 30, 2022

Retirement Benefits [Abstract]

Pension Expense

Espey Mfg. & Electronics Corp.

Notes to Financial Statements

Note 7. Pension Expense

Under terms of a negotiated union contract which expired on June 30, 2022, the Company was obligated to make contributions to a union-sponsored International Brotherhood of Electrical Workers Local 1799 defined benefit pension plan (Plan identifying number is 14-6065199) covering eligible employees. Such contributions and expenses are based upon hours worked at a specified rate and amounted to $110,378 in fiscal year 2022 and $112,997 in fiscal year 2021. These contributions represent more than five percent of the total contributions made into the Plan. For the years beginning January 1, 2022 and 2021, the Plan was in the “green zone” which means it is neither endangered nor critical status. A Funding Improvement Plan, entered into by Plan Trustees in fiscal year 2013, when the Plan was in “critical status,” called for an increase in contributions starting January 1, 2016 of $0.04 per hour for each year for five years thereafter. The increases did not and will not have a material impact on the Company’s financial statements. The union contract was renewed for an additional three-year term effective July 1, 2022 which resulted in no changes to the factors used in calculating obligated contributions.

In addition, a Memorandum of Understanding (MOU) between the Company and Union which was effective July 1, 2021, the Company agreed and became obligated to make contributions to the National Electrical Benefit Fund (NEBF) (Plan identifying number is 53-0181657). The Plan is a defined pension benefit plan covering eligible union employees. Such contributions and expenses amounted to $73,771 in fiscal year 2022. The contribution did not and will not in the future have a material impact on the Company’s financial statements.

The Company sponsors a 401(k) plan for non-union workers with employee and employer matching contributions. The employer match is 10% of the employee contribution and was $53,836 and $49,218, for fiscal years 2022 and 2021, respectively.