Employee Benefits News examines legal developments that impact the employee benefits and executive compensation employers provide, including federal and state legislation, rules from federal...
Oct. 12 — Add Yum! Brands Inc. to the list of companies moving their employees out of defined benefit pension plans.
The company offered certain former employees with deferred vested balances in the company’s pension plan the option to take a lump-sum payment, or an annuity payment, according to the company’s Oct. 11 Form 10-Q filing with the Securities and Exchange Commission. Those who received the offer have until Oct. 25 to take it.
Pension plan de-risking—whereby employers take actions designed to reduce or eliminate the pension plan liability on their balance sheets—has become an increasingly popular transaction in recent years. Some blame the rising premiums that must be paid to the Pension Benefit Guaranty Corporation for the moves plans are making with their defined benefit plans. Other observers cite the impending changes to the Internal Revenue Service’s mortality tables that could hike pension funding liabilities by as much as 10 percent.
Forms of de-risking include offering lump-sum payments to participants or transferring liabilities to a third-party insurer that makes benefit payments on behalf of the employer. In the past several months, United Technologies Inc., Carpenter Technology Corp., HP Inc., Briggs & Stratton Corp. and TJX Cos. have offered lump-sum payouts to current and former employees, and Scholastic Corp. announced it was closing its cash balance pension plan.
To contact the reporter on this story: Kristen Ricaurte Knebel in Washington at email@example.com
To contact the editor responsible for this story: Jo-el J. Meyer at firstname.lastname@example.org
The 10-Q filing can be found at: https://www.sec.gov/ix?doc=/Archives/edgar/data/1041061/000104106116000095/yum-932016x10q.htm.
Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)