Employee Benefit Plans

12 Months Ended

Mar. 31, 2020

Defined Benefit Plans

The Company has defined benefit pension plans that cover certain French and German employees. Most of these defined pension plans, which were acquired in the Atmel and Microsemi acquisitions, are unfunded. Plan benefits are provided in accordance with local statutory requirements. Benefits are based on years of service and employee compensation levels. Pension liabilities and charges are based upon various assumptions, updated annually, including discount rates, future salary increases, employee turnover, and mortality rates. The Company’s French pension plan provides for termination benefits paid to covered French employees only at retirement, and consists of approximately one to five months of salary. The Company's German pension plan provides for defined benefit payouts for covered German employees following retirement.

The aggregate net pension expense relating to these two plans is as follows (in millions):



	Year Ended March 31,
	2020		2019		2018
Service costs	$	1.7	$	1.5	$	2.2
Interest costs	0.9		1.1		1.0
Amortization of actuarial loss	0.8		0.4		0.8
Net pension period cost	$	3.4	$	3.0	$	4.0

Interest costs and amortization of actuarial losses are recorded in the other income (loss), net line item in the statements of income.

The change in projected benefit obligation and the accumulated benefit obligation, were as follows (in millions):



	Year Ended March 31,
	2020			2019
Projected benefit obligation at the beginning of the year	$	72.7		$	61.0
Additions due to acquisition of Microsemi	—			9.8
Service cost	1.7			1.5
Interest cost	0.9			1.1
Actuarial losses	(2.6		)	6.0
Benefits paid	(1.5		)	(0.9		)
Foreign currency exchange rate changes	(1.2		)	(5.8		)
Projected benefit obligation at the end of the year	$	70.0		$	72.7
Accumulated benefit obligation at the end of the year	$	65.1		$	66.7
Weighted average assumptions
Discount rate	1.48		%	1.41		%
Rate of compensation increase	2.77		%	2.79		%

The Company's pension liability represents the present value of estimated future benefits to be paid. The discount rate is based on the quarterly average yield for Euros treasuries with a duration of 30 years, plus a supplement for corporate bonds (Euros, AA rating). Net actuarial losses, which are included in accumulated other comprehensive loss in the Company's consolidated balance sheets, will be recognized as a component of net periodic cost over the average remaining service period.

As the defined benefit plans are unfunded, the liability recognized on the Company's consolidated balance sheet as of March 31, 2020 was $70.0 million of which $1.3 million is included in accrued liabilities and $68.7 million is included in other long-term liabilities. The liability recognized on the Company's consolidated balance sheet as of March 31, 2019 was $72.7 million of which $1.3 million is included in accrued liabilities and $71.4 million is included in other long-term liabilities.

Future estimated expected benefit payments for fiscal year 2021 through 2030 are as follows (in millions):



Fiscal Year Ending March 31,	Expected Benefit Payments
2021	$	1.3
2022	1.5
2023	1.8
2024	2.4
2025	2.2
2026 through 2030	12.9
Total	$	22.1

The Company's net periodic pension cost for fiscal 2021 is expected to be approximately $2.8 million.

Defined Contribution Plans

The Company maintains a contributory profit-sharing plan for its domestic employees meeting certain eligibility and service requirements. The plan qualifies under Section 401(k) of the Internal Revenue Code of 1986, as amended, and allows employees to contribute up to 60% of their base salary, subject to maximum annual limitations prescribed by the IRS. The Company has a discretionary matching contribution program. All matches are provided on a quarterly basis and require the participant to be an active employee at the end of the applicable quarter. During fiscal 2020, 2019 and 2018, the Company's matching contributions to the plan totaled $5.3 million, $8.6 million and $8.8 million, respectively.

Effective January 1, 1997, the Company adopted a non-qualified deferred compensation arrangement. This plan is unfunded and is maintained primarily for the purpose of providing deferred compensation for a select group of highly compensated employees as defined in ERISA Sections 201, 301 and 401. There are no Company matching contributions made under this plan.

The Company has management incentive compensation plans which provide for bonus payments, based on a percentage of base salary, from an incentive pool created from operating profits of the Company, at the discretion of the Board of Directors. During fiscal 2020, 2019 and 2018, $28.3 million, $18.7 million and $48.1 million were charged against operations for these plans, respectively.

The Company also has a plan that, at the discretion of the Board of Directors, provides a cash bonus to all employees of the Company based on the operating profits of the Company. During fiscal 2020, 2019 and 2018, $23.8 million, $16.4 million and $36.3 million, respectively, were charged against operations for this plan.