General Mills will be freezing its pensions at the end of 2027, according to the company’s annual report filed Thursday. The move comes on the heels of a similar announcement by UPS.
Defined benefit plans will be frozen at the end of the year, officially taking effect Jan. 1, 2028, when active US employees’ benefits will no longer accrue, according to the 10-K filing with the Securities and Exchange Commission (SEC).
In June 2013, the company’s pension plans were closed to salaried new hires. On Jan. 1, 2018, the plan will be closed to newly hired non-union production employees.
As of May 31, the pension plans, which have a combined $5.925 billion in assets, had a combined $6.459 billion in liabilities and were 92% funded. This is up from the previous fiscal year, where the plans had $5.54 billion in assets and $6.449 in liabilities for a funded status of 86%.
According to the SEC filing, the company does not expect to make a contribution to its pension funds in the 2018 fiscal year-end, although it made a $25 million contribution this year. General Mills also lowered its expected rate of return for fiscal 2018 to 7.95% from 8.17% in fiscal 2017.
General Mills’ 401(k) plan, which has $3.26 billion in assets, will remain unchanged.