Employee Benefit Plans | Employee benefit plans Retirement plans and retiree health and life insurance plans The Company provides non-contributory defined benefit pension plans for a majority of its employees in the United States, and certain of its employees in Mexico, Belgium, Germany, Greece, France, and Turkey. The Company also sponsors contributory defined benefit pension plans covering the majority of its employees in the United Kingdom, Canada and the Netherlands. Effective December 31, 2003, the Company froze participation for newly hired salaried and non-union hourly U.S. employees in its traditional defined benefit pension plan. At that time, the Company adopted a defined contribution plan, the Sonoco Investment and Retirement Plan (SIRP), which covers its non-union U.S. employees hired on or after January 1, 2004. On February 4, 2009, the U.S. qualified defined benefit pension plan was amended to freeze plan benefits for all active participants effective December 31, 2018. Active participants of the U.S. qualified plan had a one-time option to transfer into the SIRP effective January 1, 2010. Approximately one third of the active participants chose that option. Remaining active participants in the U.S. qualified plan will become participants of the SIRP effective January 1, 2019. The Company also provides postretirement healthcare and life insurance benefits to a limited number of its retirees and their dependents in the United States and Canada, based on certain age and/or service eligibility requirements. The components of net periodic benefit cost include the following: 2015 2014 2013 Retirement Plans Service cost $ 23,366 $ 21,826 $ 25,198 Interest cost 70,797 73,505 67,235 Expected return on plan assets (94,307 ) (93,198 ) (86,545 ) Amortization of net transition obligation 65 405 438 Amortization of prior service cost 745 697 569 Amortization of net actuarial loss 42,584 26,523 43,776 Effect of settlement loss — — 1,947 Other 49 77 — Net periodic benefit cost $ 43,299 $ 29,835 $ 52,618 Retiree Health and Life Insurance Plans Service cost $ 711 $ 726 $ 891 Interest cost 766 1,034 942 Expected return on plan assets (1,661 ) (1,599 ) (1,510 ) Amortization of prior service credit (104 ) (1,381 ) (2,969 ) Amortization of net actuarial gain (673 ) (259 ) — Net periodic benefit income $ (961 ) $ (1,479 ) $ (2,646 ) The following tables set forth the Plans’ obligations and assets at December 31 : Retirement Plans Retiree Health and Life Insurance Plans 2015 2014 2015 2014 Change in Benefit Obligation Benefit obligation at January 1 $ 1,857,106 $ 1,596,458 $ 27,451 $ 27,521 Service cost 23,366 21,826 711 726 Interest cost 70,797 73,505 766 1,034 Plan participant contributions 452 486 1,046 1,049 Plan amendments 519 812 (2,273 ) — Actuarial loss/(gain) (106,211 ) 278,428 (6,004 ) 736 Benefits paid (87,626 ) (91,078 ) (2,556 ) (3,568 ) Impact of foreign exchange rates (25,822 ) (26,791 ) (88 ) (47 ) Acquisitions — 3,460 — — Other 1,015 — — — Benefit obligation at December 31 $ 1,733,596 $ 1,857,106 $ 19,053 $ 27,451 Retirement Plans Retiree Health and Life Insurance Plans 2015 2014 2015 2014 Change in Plan Assets Fair value of plan assets at January 1 $ 1,407,461 $ 1,331,934 $ 23,064 $ 22,497 Actual return on plan assets (13,886 ) 144,209 (107 ) 2,323 Company contributions 22,233 53,020 911 875 Plan participant contributions 452 486 1,046 1,049 Benefits paid (87,626 ) (91,078 ) (2,556 ) (3,568 ) Impact of foreign exchange rates (24,271 ) (23,849 ) — — Expenses paid (6,177 ) (7,261 ) (108 ) (112 ) Fair value of plan assets at December 31 $ 1,298,186 $ 1,407,461 $ 22,250 $ 23,064 Funded Status of the Plans $ (435,410 ) $ (449,645 ) $ 3,197 $ (4,387 ) Retirement Plans Retiree Health and Life Insurance Plans 2015 2014 2015 2014 Total Recognized Amounts in the Consolidated Balance Sheets Noncurrent assets $ 4,635 $ 3,151 $ 4,057 $ — Current liabilities (8,678 ) (12,759 ) (860 ) (831 ) Noncurrent liabilities (431,367 ) (440,037 ) — (3,556 ) Net liability $ (435,410 ) $ (449,645 ) $ 3,197 $ (4,387 ) Items not yet recognized as a component of net periodic pension cost that are included in Accumulated Other Comprehensive Loss (Income) as of December 31, 2015 and 2014 , are as follows: Retirement Plans Retiree Health and Life Insurance Plans 2015 2014 2015 2014 Net actuarial loss $ 691,482 $ 725,714 $ (6,274 ) $ (2,818 ) Prior service cost/(credit) 3,791 4,023 (2,272 ) (103 ) Net transition obligation — 65 — — $ 695,273 $ 729,802 $ (8,546 ) $ (2,921 ) The amounts recognized in Other Comprehensive Loss/(Income) during December 31, 2015 and 2014 include the following: Retirement Plans Retiree Health and Life Insurance Plans 2015 2014 2013 2015 2014 2013 Adjustments arising during the period: Net actuarial loss/(gain) $ 8,352 $ 233,962 $ (178,648 ) $ (4,129 ) $ 101 $ (5,527 ) Prior service cost/(credit) 513 729 1,902 (2,273 ) (46 ) — Net settlements/curtailments — — (1,947 ) — — — Reversal of amortization: Net actuarial loss (42,584 ) (26,523 ) (43,776 ) 673 259 — Prior service cost/(credit) (745 ) (697 ) (569 ) 104 1,381 2,969 Net transition obligation (65 ) (405 ) (438 ) — — — Total recognized in other comprehensive loss/(income) $ (34,529 ) $ 207,066 $ (223,476 ) $ (5,625 ) $ 1,695 $ (2,558 ) Total recognized in net periodic benefit cost and other comprehensive loss/(income) $ 8,770 $ 236,901 $ (170,858 ) $ (6,586 ) $ 216 $ (5,204 ) Of the amounts included in Accumulated Other Comprehensive Loss/(Income) as of December 31, 2015 , the portions the Company expects to recognize as components of net periodic benefit cost in 2016 are as follows: Retirement Plans Retiree Health and Life Insurance Plans Net actuarial loss $ 37,662 $ (532 ) Prior service cost/(credit) 753 (498 ) Net transition obligation — — $ 38,415 $ (1,030 ) The accumulated benefit obligation for all defined benefit plans was $1,691,589 and $1,799,216 at December 31, 2015 and 2014 , respectively. The projected benefit obligation (PBO), accumulated benefit obligation (ABO) and fair value of plan assets for pension plans with accumulated benefit obligations in excess of plan assets were, $1,656,174 , $1,617,051 and $1,216,128 , respectively, as of December 31, 2015 , and $1,811,459 , $1,757,235 and $1,358,663 , respectively, as of December 31, 2014 . The following table sets forth the Company’s projected benefit payments for the next ten years: Year Retirement Plans Retiree Health and Life Insurance Plans 2016 $ 86,234 $ 2,173 2017 $ 89,282 $ 2,103 2018 $ 92,596 $ 2,055 2019 $ 95,245 $ 2,007 2020 $ 98,004 $ 1,653 2021-2025 $ 520,612 $ 6,744 Assumptions The following tables set forth the major actuarial assumptions used in determining the PBO, ABO and net periodic cost: Weighted-average assumptions used to determine benefit obligations at December 31 U.S. Retirement Plans U.S. Retiree Health and Life Insurance Plans Foreign Plans Discount Rate 2015 4.36 % 3.78 % 3.71 % 2014 4.00 % 3.52 % 3.49 % Rate of Compensation Increase 2015 3.69 % 3.36 % 3.52 % 2014 3.99 % 3.42 % 3.51 % Weighted-average assumptions used to determine net periodic benefit cost for years ended December 31 U.S. Retirement Plans U.S. Retiree Health and Life Insurance Plans Foreign Plans Discount Rate 2015 4.00 % 3.52 % 3.49 % 2014 4.78 % 4.03 % 4.51 % 2013 3.90 % 3.16 % 4.36 % Expected Long-term Rate of Return 2015 7.67 % 7.39 % 4.92 % 2014 7.66 % 7.39 % 5.57 % 2013 7.65 % 7.42 % 5.57 % Rate of Compensation Increase 2015 3.99 % 3.42 % 3.51 % 2014 3.99 % 3.44 % 3.80 % 2013 4.29 % 3.51 % 3.46 % The Company adjusts its discount rates at the end of each fiscal year based on yield curves of high-quality debt instruments over durations that match the expected benefit payouts of each plan. The expected long-term rate of return assumption is based on the Company’s current and expected future portfolio mix by asset class, and expected nominal returns of these asset classes using an economic “building block” approach. Expectations for inflation and real interest rates are developed and various risk premiums are assigned to each asset class based primarily on historical performance. The expected long-term rate of return also gives consideration to the expected level of outperformance to be achieved on that portion of the Company’s investment portfolio under active management. The assumed rate of compensation increase reflects historical experience and management’s expectations regarding future salary and incentive increases. Medical trends The U.S. Retiree Health and Life Insurance Plan makes up approximately 98% of the Retiree Health liability. Therefore, the following information relates to the U.S. plan only. Healthcare Cost Trend Rate Pre-age 65 Post-age 65 2015 7.00 % 6.00 % 2014 8.00 % 8.00 % Ultimate Trend Rate Pre-age 65 Post-age 65 2015 4.90 % 4.90 % 2014 5.60 % 5.60 % Year at which the Rate Reaches the Ultimate Trend Rate Pre-age 65 Post-age 65 2015 2039 2041 2014 2042 2044 Increasing the assumed trend rate for healthcare costs by one percentage point would increase the accumulated postretirement benefit obligation (the APBO) and total service and interest cost component approximately $329 and $49 , respectively. Decreasing the assumed trend rate for healthcare costs by one percentage point would decrease the APBO and total service and interest cost component approximately $304 and $44 , respectively. Based on amendments to the U.S. plan approved in 1999, which became effective in 2003, cost increases borne by the Company are limited to the Urban CPI, as defined. Plan changes and amendments During 2015, the Company's U.S. Retiree Medical and Life Insurance Plan was amended to eliminate certain life insurance benefits for all nonunion and applicable union participants. The effect of this and other smaller amendments was a reduction in the accumulated postretirement benefit obligation of $2,273 . During 2010, certain retiree medical benefits and life insurance coverage under the Company’s U.S. Retiree Medical and Life Insurance Plan were changed, reducing the accumulated postretirement benefit obligation by $4,566 . The resulting prior service credit was amortized over a four year period ending in 2014. During 2009, the Company’s U.S. qualified defined benefit pension plan was amended to allow a lump sum payment option upon termination to plan participants who chose to freeze their benefit December 31, 2009, and move to the SIRP. The effect of this and other smaller amendments was a reduction in the projected benefit obligation of $4,300 . Also during 2009, the Company amended its U.S. Retiree Medical and Life Insurance Plan to freeze the Company subsidy for both pre- and post-Medicare retiree medical coverage at 2009 levels effective January 1, 2010, and to eliminate any early retirement reduction factor applied to the Company subsidy for pre-Medicare coverage for current retirees as of December 31, 2009. In addition, the Company will no longer provide post-Medicare retiree medical coverage to its active employees or post-1981 retirees, except for certain union groups. The impact of these changes was an overall reduction in the accumulated postretirement benefit obligation of $17,625 , which was amortized over a period of 3.3 years . The benefit from amortizing these prior service credits ended in 2013. Retirement plan assets The following table sets forth the weighted-average asset allocations of the Company’s retirement plans at December 31, 2015 and 2014 , by asset category. Asset Category U.S. U.K. Canada Equity securities 2015 49.0 % 49.0 % 62.9 % 2014 49.9 % 49.2 % 56.8 % Debt securities 2015 36.8 % 50.2 % 36.8 % 2014 37.8 % 49.6 % 43.0 % Alternative 2015 14.2 % — % — % 2014 12.2 % — % — % Cash and short-term investments 2015 — % 0.8 % 0.3 % 2014 0.1 % 1.2 % 0.2 % Total 2015 100.0 % 100.0 % 100.0 % 2014 100.0 % 100.0 % 100.0 % 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 desired level of risk. Alternative assets such as real estate funds, private equity funds and hedge funds are used to enhance expected long-term returns while improving portfolio diversification. Risk tolerance is established through consideration of plan liabilities, plan funded status and corporate financial condition. Investment risk is measured and monitored on an ongoing basis through periodic investment portfolio reviews and periodic asset/liability studies. At December 31, 2015 , postretirement benefit plan assets totaled $1,298,186 , of which $983,388 were assets of the U.S. Defined Benefit Plans. U.S. defined benefit plans The equity investments consist of direct ownership and funds and are diversified among U.S. and non-U.S. stocks of small to large capitalizations. Following the December 2010 amendment that split the U.S. qualified defined benefit pension plan into the Active Plan and the Inactive Plan effective January 1, 2011, the Company completed separate asset/liability studies for both plans during 2011 and adopted revised investment guidelines for each. The revised guidelines establish a dynamic de-risking framework that will gradually shift the allocation of assets to long-duration domestic fixed income from equity and other asset categories, as the relative funding ratio of each plan increases over time. The current target allocation (midpoint) for the Inactive Plan investment portfolio is: Equity Securities – 49% , Debt Securities – 40% , Alternative – 11% and Cash – 0% . The current target allocation (midpoint) for the Active Plan investment portfolio is: Equity Securities – 57% , Debt Securities – 30% , Alternative – 13% and Cash – 0% . United Kingdom defined benefit plan The equity investments consist of direct ownership and funds and are diversified among U.K. and international stocks of small and large capitalizations. The current target allocation (midpoint) for the investment portfolio is: Equity Securities – 48% , Debt Securities – 52% , Alternative – 0% and Cash – 0% . Canada defined benefit plan The equity investments consist of direct ownership and funds and are diversified among Canadian and international stocks of primarily large capitalizations and short to intermediate duration corporate and government bonds. The current target allocation (midpoint) for the investment portfolio is: Equity Securities – 60% , Debt Securities – 40% , Alternative – 0% and Cash – 0% . Retiree health and life insurance plan assets The following table sets forth the weighted-average asset allocations by asset category of the Company’s retiree health and life insurance plan. Asset Category December 31, 2015 December 31, 2014 Equity securities 59.8% 59.1% Debt securities 33.0% 34.5% Alternative 7.1% 6.3% Cash 0.1% 0.1% Total 100.0% 100.0% Contributions Based on current actuarial estimates, the Company anticipates that the total contributions to its retirement plans and retiree health and life insurance plans, excluding contributions to the Sonoco Savings Plan, will be approximately $47,100 in 2016. No assurances can be made, however, about funding requirements beyond 2016, as they will depend largely on actual investment returns and future actuarial assumptions. Sonoco Investment and Retirement Plan The Sonoco Investment and Retirement Plan (SIRP) is a defined contribution pension plan provided for the Company’s salaried and non-union U.S. employees who were hired on or after January 1, 2004, or those former participants in the Company’s U.S. qualified defined benefit pension plan who elected to transfer into the SIRP under a one-time option effective January 1, 2010. The Company makes an annual contribution of 4% of all eligible pay plus 4% of eligible pay in excess of the Social Security wage base to eligible participant accounts. Participants are fully vested after five years of service or upon reaching age 55 , if earlier. The Company’s expenses related to the plan for 2015 , 2014 and 2013 were approximately $14,970 , $12,079 and $11,974 , respectively. Cash contributions to the SIRP totaled $12,865 , $12,049 and $9,290 in 2015 , 2014 and 2013 , respectively. Sonoco Savings Plan The Sonoco Savings Plan is a defined contribution retirement plan provided for the Company’s U.S. employees. The plan provides for participant contributions of 1% to 30% of gross pay. Since January 1, 2010, the Company has matched 50% on the first 4% of compensation contributed by the participant as pretax contributions. The Company’s expenses related to the plan for 2015 , 2014 and 2013 were approximately $11,500 , $11,400 and $10,700 , respectively. Other plans The Company also provides retirement and postretirement benefits to certain other non-U.S. employees through various Company-sponsored and local government sponsored defined contribution arrangements. For the most part, the liabilities related to these arrangements are funded in the period they arise. The Company’s expenses for these plans were not material for all years presented. |