Arconic to freeze pension plans for U.S.-based salaried employees
Arconic said that it will freeze U.S. defined benefit pension plans for all U.S.-based salaried and non-bargained hourly employees, effective April 1, 2018. As a result, in the first quarter of 2018, the company expects to record a liability decrease of approximately $140M related to the reduction of future benefits and a curtailment charge of approximately $5M pre-tax. For the full year 2018, the company expects pension-related expense to be lower by approximately $50M pre-tax compared to 2017 full-year expenses. The pension freeze applies to the accrual of future benefits for approximately 7,900 affected U.S. employees; benefits already earned by these employees through March 31, 2018 will be available when they reach retirement eligibility. Retirees already collecting benefits and former employees with vested benefits under the pension plans will not be impacted by this change. Arconic will continue to support affected employees in preparing for a financially sound retirement by contributing 3% of their eligible compensation to the company's applicable 401(k) plan and by matching their contributions of up to 6% of eligible compensation to the applicable plan-consistent with what most new salaried employees currently receive. Arconic is also providing an additional transition contribution of 3% of eligible compensation for the remaining nine months of 2018 for affected employees.