General Motors 2011 Annual Report Download - page 130

GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Note 18. Pensions and Other Postretirement Benefits
Consolidated
Employee Pension and Other Postretirement Benefit Plans
Defined Benefit Pension Plans
Defined benefit pension plans covering eligible U.S. hourly employees (hired prior to October 15, 2007) and Canadian hourly
employees generally provide benefits of negotiated, stated amounts for each year of service and supplemental benefits for employees
who retire with 30 years of service before normal retirement age. Non-skilled trade hourly U.S. employees hired after October 15,
2007 participate in a defined benefit cash balance plan which was frozen on January 2, 2012 and will be terminated in 2012 subject to
regulatory approvals. In September 2010 the U.S. hourly defined benefit pension plan was amended to create a legally separate new
defined benefit pension plan for entry level participants who are covered by the cash balance benefit formula. The underlying benefits
offered to plan participants were unchanged. The benefits provided by the defined benefit pension plans covering eligible U.S. (hired
prior to January 1, 2001) and Canadian salaried employees and employees in certain other non-U.S. locations are generally based on
years of service and compensation history. There is also an unfunded nonqualified pension plan covering certain U.S. executives for
service prior to January 1, 2007, and it is based on an “excess plan” for service after that date.
In January 2012 we amended the U.S. salaried pension plan to cease the accrual of additional benefits effective September 30,
2012. Active plan participants will receive additional contributions in the defined contribution plan starting in October 2012. This
amendment will result in a curtailment, with an insignificant expense effect, and reduce the projected benefit obligation by
approximately $300 million.
Pension Contributions
The funding policy for qualified defined benefit pension plans is to contribute annually not less than the minimum required by
applicable law and regulations or to directly pay benefit payments where appropriate. At December 31, 2011 all legal funding
requirements had been met. We expect to contribute $100 million to our U.S. non-qualified plans and $740 million to our non-U.S.
pension plans in 2012.
The following table summarizes contributions made to the defined benefit pension plans or direct payments to plan beneficiaries
(dollars in millions):
Successor Predecessor
Year Ended
December 31, 2011
Year Ended
December 31, 2010
July 10, 2009
Through
December 31, 2009
January 1, 2009
Through
July 9, 2009
U.S. hourly and salaried ............................ $1,962 $4,095 $ 31 $ 57
Non-U.S. ........................................ 836 777 4,287 529
Total ............................................ $2,798 $4,872 $4,318 $586
We made a contribution in January 2011 to our U.S. hourly and salaried defined benefit pension plans of 61 million shares of our
common stock valued at $2.2 billion for funding purposes at the time of contribution. The contributed shares qualified as a plan asset
for funding purposes at the time of contribution and as a plan asset valued at $1.9 billion for accounting purposes in July 2011. This
was a voluntary contribution above our funding requirements for the pension plans.
Other Postretirement Benefit Plans
Certain hourly and salaried defined benefit plans provide postretirement medical, dental, legal service and life insurance to eligible
U.S. and Canadian retirees and their eligible dependents. Certain other non-U.S. subsidiaries have postretirement benefit plans,
although most non-U.S. employees are covered by government sponsored or administered programs.
128 General Motors Company 2011 Annual Report