Safeway 2013 Annual Report Download - page 89

Table of Contents
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Multiemployer postretirement benefit plans other than pensions Safeway contributes to a number of multiemployer postretirement
benefit plans other than pensions under the terms of its collective bargaining agreements that cover union-represented employees. These
plans may provide medical, pharmacy, dental, vision, mental health and other ancillary benefits to active employees and retirees as
determined by the trustees of each plan. These benefits are not vested. A significant portion of Safeway contributions benefit active
employees and, as such, may not constitute contributions to a postretirement benefit plan. Safeway is unable to separate all contribution
amounts paid to benefit active participants in order to separately report contributions paid to provide postretirement benefits for retirees.
Contributions made by Safeway to health and welfare plans providing active and postretirement benefits were $733.4 million in 2011. Prior
to December 28, 2013, certain of these plans split into two plans, separating plans for active employees from plans providing postretirement
benefits. This, along with the availability of additional data in 2013 and 2012, allowed for a more precise estimate of contributions for
multiemployer postretirement benefit plans other than pension. Based on the data now available, it is estimated that Safeway may have
contributed as much as $302.0 million in 2013 and as much as $473.3 million in 2012 to fund these plans. Actual funding of
postretirement benefit plans other than pensions is likely much lower as this amount continues to include contributions which benefit active
employees.
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At year-end 2013, 2012 and 2011, Safeway’s investment in unconsolidated affiliates includes a 49% ownership interest in Casa Ley, which
operated 200 food and general merchandise stores in Western Mexico at year-end 2013. See Note U for the Company's consideration to
explore alternatives to monetize this investment.
Equity in earnings from Safeway’s unconsolidated affiliates, which is included in other income, was income of $17.6 million in 2013, $17.5
million in 2012 and $13.0 million in 2011.
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Legal Matters The Company is subject from time to time to various claims and lawsuits arising in the ordinary course of business,
including lawsuits involving trade practices, lawsuits alleging violations of state and/or federal wage and hour laws (including alleged
violations of meal and rest period laws and alleged misclassification issues), real estate disputes and other matters. Some of these suits
purport or may be determined to be class actions and/or seek substantial damages.
In February 2012, Safeway was served with a subpoena issued by a group of California District Attorneys seeking documents and
information related to the handling, disposal and reverse logistics of potential hazardous waste within the State. The subject matter of the
subpoena relates to the handling and transportation of unsaleable household items, including, but not limited to, cleaners, aerosols, hair
shampoos, dye, lotions, light bulbs, batteries, over-the-counter and similar items.
It is management's opinion that although the amount of liability with respect to certain of the above matters cannot be ascertained at this
time, any resulting liability of these and other matters, including any punitive damages, will not have a material effect on the Company's
financial statements taken as a whole.
Commitments The Company has commitments under contracts for the purchase of property and equipment and for the construction of
buildings, marketing development funds, the purchase of energy and other purchase obligations. Portions of such contracts not completed at
year end are not reflected in the consolidated financial statements. These purchase commitments were $568 million at year-end 2013.
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