Employee Benefit Plans

Defined Contribution Plans

The Company sponsors defined contribution savings plans for all eligible employees meeting length of service requirements. Under the primary plan, participants may contribute an amount up to 25% of pretax annual compensation subject to certain limitations. The Company matches 100% of the first 3% of employee contributions and 50% of the next 2% of employee contributions. The Company matching contributions vest immediately.

The Company’s matching contributions were $5.5 million, $5.0 million, and $4.9 million for the years ended June 30, 2017, 2016 and 2015, respectively.

Multiemployer Pension Plans

The Company contributes to various union sponsored multiemployer benefit plans in the U.S. and Canada. Benefits under these plans are generally based on compensation levels and years of service.

For the Company, the financial risks of participating in multiemployer plans are different from single-employer plans in the following respects:


•	Assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees of other participating employers.


•	If a participating employer discontinues contributions to a plan, the unfunded obligations of the plan may be borne by the remaining participating employers.


•	If a participating employer chooses to stop participating in a plan, a withdrawal liability may be created based on the unfunded vested benefits for all employees in the plan.

Under federal legislation regarding multiemployer pension plans, in the event of a withdrawal from a plan or plan termination, companies are required to continue funding their proportionate share of such plan’s unfunded vested benefits. We are a participant in multiple union sponsored multiemployer plans, and, as a plan participant, our potential obligation could be significant. The amount of the potential obligation is not currently ascertainable because the information required to determine such amount is not identifiable or readily available.

Our participation in significant plans for the fiscal year ended June 30, 2017 is outlined in the table below. The “EIN/Pension Plan Number” column provides the Employer Identification Number (“EIN”) and the three digit plan number. The zone status is based on the latest information that the Company received from the plan and is certified by the plan’s actuary. Plans in the red zone are generally less than 65 percent funded, plans in the yellow zone are generally less than 80 percent funded, and plans in the green zone are generally at least 80 percent funded. The “FIP/RP Status Pending/Implemented” column indicates plans for which a financial improvement plan (“FIP”) or a rehabilitation plan (“RP”) is either pending or has been implemented. The “Surcharge Imposed” column includes plans in a red zone status that require a payment of a surcharge in excess of regular contributions. The last column lists the expiration date of the collective-bargaining agreement to which the plan is subject.

Pension Fund

EIN/Pension

Plan Number

Pension

Protection Act

Zone Status

FIP/RP

Status

Pending or

Implemented

Company Contributions

Fiscal Year

Surcharge

Imposed

Expiration

Date of

Collective-

Bargaining

Agreement

2017

2016

2017

2016

2015

(In thousands)

Boilermaker-Blacksmith National Pension Trust

48-6168020/001

Described below (2)

7,098

7,658

8,330

Described below (2)

Described below (1)

Joint Pension Fund Local Union 164 IBEW

22-6031199/001

Described below (2)

2,709

2,635

3,026

Described below (2)

5/31/2021

Joint Pension Fund of Local Union No 102

22-1615726/001

Green

N/A

2,392

3,063

2,395

5/31/2019

IBEW Local 456 Pension Plan

22-6238995/001

Green

N/A

2,777

1,168

788

12/3/2017

Local 351 IBEW Pension Plan

22-3417366/001

Green

N/A

2,796

5,018

2,608

9/30/2017

Steamfitters Local Union No 420 Pension Plan

23-2004424/001

Red

Yes

2,234

1,265

937

Yes

4/30/2020

IBEW Local Union 98 Pension Plan

23-1990722/001

Described below (2)

1,519

1,653

2,768

Described below (2)

4/28/2018

Indiana Laborers Pension Fund

35-6027150/001

Described below (2)

2,458

2,320

2,519

Described below (2)

5/31/2018

Iron Workers Mid-America Pension Plan

36-6488227/001

Green

N/A

1,785

2,248

2,605

5/31/2019

Plumbers & Pipefitters Local Union 74 Pension Fund

51-6015925/001

Yellow

Yes

552

4,473

6/15/2018

Pipe Fitters Retirement Fund, Local 597

62-6105084/001

Green

N/A

2,563

2,377

2,259

5/31/2018

Contributions to other multiemployer plans

20,374

16,054

22,282

Total contributions made

48,709

46,011

54,990


(1)	Our employees are members of several Boilermaker unions that participate in the Boilermaker-Blacksmith National Pension Trust. The most significant of these unions are Boilermakers Local 374 and Boilermakers Local 128, which have collective bargaining agreements that expire on December 31, 2019 and December 31, 2020, respectively.

(2)

For the Boilermaker-Blacksmith National Pension Trust, Local 164 IBEW Pension Plan, Local 98 IBEW Pension Plan and the Indiana Laborers Pension Fund, the Company has not received a funding notification that covers the Company's fiscal years 2017 or 2016 during the preparation of this Form 10-K. Under Federal pension law, if a multiemployer pension plan is determined to be in critical or endangered status, the plan must provide notice of this status to participants, beneficiaries, the bargaining parties, the Pension Benefit Guaranty Corporation, and the Department of Labor. The Company also observed that these plans have not submitted any Critical or Endangered Status Notices to the Department of Labor for either calendar years 2017 or 2016 (which can be accessed at http://www.dol.gov/ebsa/criticalstatusnotices.html).

Employee Stock Purchase Plan

The Matrix Service Company 2011 Employee Stock Purchase Plan (“ESPP”) was effective January 1, 2011. The ESPP allows employees to purchase shares through payroll deductions and members of the Board of Directors to purchase shares from amounts withheld from their cash retainers. Share purchases are limited to an aggregate market value of no greater than $60,000 per calendar year per participant and are purchased at market value with no discount to the participant. Contributions are with after tax earnings and are accumulated in non-interest bearing accounts for quarterly purchases of company stock. Upon the purchase of shares, the participants receive all stockholder rights including dividend and voting rights, and are permitted to sell their shares at any time. The Company has made 1,000,000 shares available under the ESPP. The ESPP can be terminated at the discretion of the Board of Directors or on January 2, 2021. Shares are issued from Treasury Stock under the ESPP. There were 16,609 shares issued in fiscal 2017, 17,304 shares in fiscal 2016, and 13,243 shares in fiscal 2015.