Employee Benefit Plans

12 Months Ended

Dec. 31, 2012

Compensation and Retirement Disclosure [Abstract]

Employee Benefit Plans

Employee Benefit Plans

Defined Benefit Plan

The Company has a defined benefit pension plan which is frozen, that covers certain U.S. hourly and salary employees. The defined benefit plan provides benefits based primarily on the participants’ years of service and compensation.

The following table sets forth the components of net periodic pension expense as follows: 

	Year Ended December 31,
	2012			2011			2010
Interest cost	$	2,206		$	2,409		$	2,447
Expected return on plan assets	(2,648		)	(2,575		)	(2,353		)
Amortization of net loss	974			365			269
Total net periodic pension expense	$	532		$	199		$	363

The following table sets forth changes in the projected benefit obligation and plan assets, the funded status of the plans and the amounts recognized in the consolidated balance sheets:

	December 31,
	2012			2011
Change in projected benefit obligation:
Projected benefit obligation at beginning of year	$	49,925		$	44,693
Interest cost	2,206			2,409
Benefits paid	(1,710		)	(1,641		)
Actuarial losses	6,847			4,464
Projected benefit obligation at year end	$	57,268		$	49,925
Change in plan assets:
Fair value of plan assets at beginning of year	$	34,020		$	33,210
Actual return (loss)	3,899			(473		)
Employer contributions	1,732			2,924
Benefits paid	(1,710		)	(1,641		)
Fair value of plan assets at year end	$	37,941		$	34,020
Funded status (Accrued pension liabilities)	$	(19,327	)	$	(15,905	)
Unrecognized actuarial loss recognized in other comprehensive income	$	19,978		$	15,355

The estimated net loss for the defined benefit pension plan that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next fiscal year is $1,348.

The actuarial assumptions used in determining pension plan information are as follows:

	December 31,
	2012		2011		2010
Assumptions used to determine benefit obligation at year end:
Discount rate	3.75	%	4.50	%	5.50	%
Assumptions used to determine net periodic benefit cost:
Discount rate	4.50	%	5.50	%	6.00	%
Expected long-term weighted-average rate of return on plan assets	7.75	%	7.75	%	7.75	%

The discount rate reflects the current rate at which the pension liabilities could be effectively settled at year end. In estimating this rate, the Company looks to rates of return on high quality, fixed-income investments that receive one of the two highest ratings given by a recognized rating agency and the expected timing of benefit payments under the plan.

The expected return assumptions were developed using a simple averaging formula based upon the plans’ investment guidelines, mix of asset classes, historical returns of equities and bonds, and expected future returns. The Company employs a total return investment approach whereby a mix of equities and fixed income investments are used to maximize the long-term return of plan assets for a prudent level of risk. Risk tolerance is established through careful consideration of short and long-term plan liabilities, plan funded status and corporate financial condition. The investment portfolio contains a diversified blend of equity and fixed-income investments. Furthermore, equity investments are diversified across U.S. and non-U.S. stocks, as well as growth, value, and small and large capitalizations. Investment risk is measured and monitored on an ongoing basis through quarterly investment portfolio reviews, annual liability measurements and periodic asset/liability studies.

The plan assets are invested in pooled separate accounts. The fair values of participation units held in pooled separate accounts are based on their net asset values, as reported by the managers of the pooled separate accounts as supported by the unit prices of actual purchase and sale transactions occurring as of or close to the financial statement date. Therefore, the Company’s plan assets are valued using Level 2 inputs. The target asset allocations and fair values by asset category at December 31 are as follows:

			Fair Value
Assets:	Target		2012		2011
Pooled separate accounts - Equity	55	%	$	21,265	$	19,109
Pooled separate accounts - Fixed income funds	43	%	16,650		14,909
Pooled separate accounts - Cash and cash equivalents	2	%	26		2
Total	100	%	$	37,941	$	34,020

The Company’s funding policy is to contribute at least the minimum funding amounts required by law. Based upon current actuarial estimates, the Company expects to contribute $635 to its defined benefit pension plan in 2013. The following benefit payments are expected to be paid by the plan in each of the next five years and in the aggregate for the subsequent five years:

2013	$	1,900
2014	2,000
2015	2,100
2016	2,200
2017	2,400
In aggregate during five years thereafter	14,400

Multi-Employer Plan

The Company contributes to a multi-employer plan for certain collective bargaining U.S. employees. The risks of participating in this multi-employer plan are different from a single employer plan in the following aspects:

(a) Assets contributed to the multi-employer by one employer may be used to provide benefits to employees of other participating employers.

(b) If a participating employer ceases contributing to the plan, the unfunded obligations of the plan may be inherited by the remaining participating employers.

(c) If the Company chooses to stop participating in the multi-employer plan, the Company may be required to pay those plans an amount based on the underfunded status of the plan, referred to as a withdrawal liability.

The Company has assessed and determined that the multi-employer plan to which it contributes is not significant to the Company's financial statements. The Company does not expect to incur a withdrawal liability or expect to significantly increase its contribution over the remainder of the current contract period which ends February 2018. The Company made contributions to the bargaining unit supported multi-employer pension plan resulting in expense of $760, $518 and $391 for the years ended December 31, 2012, 2011 and 2010, respectively.

Defined Contribution Savings Plan

The Company has a defined contribution savings plan that covers most of its U.S. employees. Company contributions to the plan are based on employee contributions, and a Company match and discretionary contributions. Expenses under the plan totaled $8,011, $6,241 and $4,949 for the years ended December 31, 2012, 2011 and 2010, respectively.

Voluntary Deferred Income Plan

The Company provides additional retirement plan benefits to certain members of management under the Amended and Restated Chart Industries, Inc. Voluntary Deferred Income Plan; this is an unfunded plan. The Company recorded $507 of expense associated with this plan for the year ended December 31, 2012.