Employee Benefit Plans

12 Months Ended

Dec. 31, 2021

Retirement Benefits [Abstract]

Employee Benefit Plans

Employee Benefit Plans

The Corporation sponsors a contributory defined contribution Section 401(k) plan. The plan permits eligible employees to make pre-tax and Roth contributions up to 70% of salary. Employees 21 years of age or over with a minimum of one-year with 1,000 hours of service are eligible for matching contributions by the Corporation at 100% for every 1% contributed up to 3% then 50% for every 1% contributed up to the next 2% in total of the employee’s compensation. The Corporation’s matching contribution and related expenses were $1.2 million, $1.1 million and $906 thousand for the years ended December 31, 2021, 2020, and 2019, respectively. A profit sharing discretionary non-contributory pension plan component is in place for employees 21 years of age or over with a minimum of one-year with 1,000 hours of service and allows employer contributions in an amount equal to a percentage of eligible compensation plus 5.7% of the compensation in excess of $143 thousand, subject to a $290 thousand salary limit. The Corporation recognized profit sharing expense of $2.0 million, $1.9 million and $1.9 million for the year ended December 31, 2021, 2020, and 2019 respectively.

The Corporation has adopted a non-qualified supplemental executive retirement plan ("SERP") for certain executives to compensate those executive participants in the Corporation’s retirement plan whose benefits are limited by compensation limitations under current tax law. The SERP is considered an unfunded plan for tax and ERISA purposes and all obligations arising under the SERP are payable from the general assets of the Corporation. At December 31, 2021 and 2020, obligations of $8.8 million and $7.0 million, respectively, were included in other liabilities for this plan. Expenses related to this plan were $2.1 million for the year ended December 31, 2021, $992 thousand for the year ended December 31, 2020 and $724 thousand for the year ended December 31, 2019.

The Corporation has established a Survivor Benefit Plan for the benefit of outside directors. The purpose of the plan is to provide life insurance benefits to beneficiaries of the Corporation’s directors who at the time of their death are participants in the plan. The plan is considered an unfunded plan for tax and ERISA purposes and all obligations arising under the plan are payable from the general assets of the Corporation. At December 31, 2021 and 2020, obligations of $1.5 million and $1.4 million, respectively, were included in other liabilities for this plan. Expenses (benefits) related to this plan were $196 thousand for the year ended December 31, 2021, $253 thousand for the year ended December 31, 2020 and $(1) thousand for the year ended December 31, 2019.

On December 31, 2021, the Corporation adopted a Defined Contribution Plan for several employees (the “Plan”), pursuant to which the Corporation will make certain annual contributions to the Plan on the employee's behalf, which will be paid to the employee following their termination of employment from the Corporation or, if earlier, upon the employee becoming disabled. The Plan became effective as of January 2, 2022.

The Corporation has an unfunded post-retirement benefits plan which provides certain health care benefits for retired employees who have reached the age of 60 and retired with 30 years of service. The plan was amended in 2013 to include only employees hired prior to January 1, 2000. Benefits are provided for these retired employees and their qualifying dependents from the age of 60 through the age of 65.

The following table sets forth the change in the benefit obligation of the plan as of and for the years ended December 31, 2021 and 2020:

	December 31, 2021		December 31, 2020
Benefit obligation at beginning of year	$	1,829	$	2,030
Interest cost	28		51
Service cost	52		61
Actual claims	(31)		(36)
Actuarial gain	(391)		(277)
Benefit obligation at end of year	$	1,487	$	1,829

Amounts recognized in accumulated other comprehensive income at December 31, 2021 and 2020 consisted of: 

	December 31, 2021		December 31, 2020
Net actuarial gain	$	782	$	435
Tax effect	(165)		(92)
	$	617	$	343

The accumulated benefit obligation was $1.5 million and $1.8 million at December 31, 2021 and 2020, respectively.

The following table sets forth the components of net periodic benefit cost and other amounts recognized in other comprehensive income:

	December 31, 2021		December 31, 2020		December 31, 2019
Service cost	$	52	$	61	$	74
Interest cost	28		51		89
Net amortization of transition obligation and actuarial loss	(43)		0		23
Net periodic benefit cost	37		112		186
Net gain	(391)		(277)		(518)
Amortization	43		0		(23)
Total recognized in other comprehensive income	(348)		(277)		(541)
Total recognized in net periodic benefit cost and other comprehensive income	$	(311)	$	(165)	$	(355)

The estimated net gain that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next fiscal year is $(113) thousand.

The weighted average discount rate used to calculate net periodic benefit cost was 1.55% for year ended December 31, 2021, 2.59% for year ended December 31, 2020, and 3.78% for year ended December 31, 2019. The weighted average rate used to calculate accrued benefit obligations was 2.10% for year ended December 31, 2021, 1.55% for year ended December 31, 2020, and 2.59% for year ended December 31, 2019. The health care cost trend rate used to measure the expected costs of benefits is 5.0% for 2022 and thereafter.