Annual report pursuant to Section 13 and 15(d)

EMPLOYEE BENEFIT PLANS

v2.4.1.9
EMPLOYEE BENEFIT PLANS
12 Months Ended
Dec. 31, 2014
EMPLOYEE BENEFIT PLANS  
EMPLOYEE BENEFIT PLANS

 

16. EMPLOYEE BENEFIT PLANS

DEFINED BENEFIT AND OTHER POSTRETIREMENT BENEFIT PLANS

        Our employees participate in a trusteed, non-contributory defined benefit pension plan (the "Plan") that covers substantially all of our full-time U.S. employees. Effective July 1, 2004, the Plan formula for employees not covered by a collective bargaining agreement was converted to a cash balance design. For represented employees, participation in the cash balance design is subject to the terms of negotiated contracts. For participating employees, benefits accrued under the prior formula were converted to opening cash balance accounts. The new cash balance benefit formula provides annual pay credits from 4% to 12% of eligible pay, depending on age and service, plus accrued interest. Participants in the plan on July 1, 2004 may be eligible for additional annual pay credits from 1% to 8%, depending on their age and service as of that date, for up to five years. The conversion to the cash balance plan did not have a significant impact on the accrued benefit liability, the funded status or ongoing pension expense.

        During 2013, we amended the Plan which enabled us to transfer some benefit amounts out of the Huntsman Supplemental Executive Retirement Plan (the "SERP") to the Plan as permitted by the IRS rules. There was no impact to the overall projected benefit obligation to the Company as a result of this amendment.

        We sponsor defined benefit plans in a number of countries outside of the U.S. The availability of these plans, and their specific design provisions, are consistent with local competitive practices and regulations.

        We also sponsor unfunded postretirement benefit plans other than pensions, which provide medical and life insurance benefits.

        Our postretirement benefit plans provide a fully insured Medicare Part D plan including prescription drug benefits affected by the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (the "Act"). We cannot determine whether the medical benefits provided by our postretirement benefit plans are actuarially equivalent to those provided by the Act. We do not collect a subsidy and our net periodic postretirement benefits cost, and related benefit obligation, do not reflect an amount associated with the subsidy.

        During 2013, we amended certain of our postretirement benefit plans to discontinue subsidizing the cost of health care coverage for retirees who are eligible for Medicare. As a result of this amendment, our projected benefit obligation decreased by $22 million with an offset to other comprehensive income (loss) during the year ended December 31, 2013.

        On March 23, 2010, President Obama signed into law the Patient Protection and Affordable Care Act. On March 30, 2010, President Obama signed into law a reconciliation measure, the Health Care and Education Reconciliation Act of 2010. The passage of this legislation has resulted in comprehensive reform of health care in the U.S. We do not believe that this will have a significant impact on our financial position.

        Beginning July 1, 2014, the Huntsman Defined Benefit Pension Plan was closed to new non-union entrants. New, non-union entrants will be provided with a defined contribution plan with a non-discretionary employer contribution and a company match.

        In connection with the Rockwood Acquisition, we assumed certain pension and other postretirement benefit liabilities in the amount of approximately $233 million.

        The following table sets forth the funded status of the plans for us and Huntsman International and the amounts recognized in our consolidated balance sheets at December 31, 2014 and 2013 (dollars in millions):

                                                                                                                                                                                    

 

 

Defined Benefit Plans

 

Other Postretirement
Benefit Plans

 

 

 

2014

 

2013

 

2014

 

2013

 

 

 

U.S.
Plans

 

Non-U.S.
Plans

 

U.S.
Plans

 

Non-U.S.
Plans

 

U.S.
Plans

 

Non-U.S.
Plans

 

U.S.
Plans

 

Non-U.S.
Plans

 

Change in benefit obligation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Benefit obligation at beginning of year

 

$

877

 

$

2,859

 

$

958

 

$

2,755

 

$

105

 

$

5

 

$

136

 

$

7

 

Service cost

 

 

27

 

 

32

 

 

31

 

 

38

 

 

3

 

 

 

 

4

 

 

 

Interest cost

 

 

45

 

 

102

 

 

40

 

 

90

 

 

5

 

 

 

 

5

 

 

 

Participant contributions

 

 

 

 

7

 

 

 

 

9

 

 

3

 

 

 

 

5

 

 

 

Plan amendments

 

 

 

 

(6

)

 

 

 

1

 

 

 

 

 

 

(22

)

 

 

Acquisitions/divestitures

 

 

9

 

 

333

 

 

 

 

 

 

3

 

 

 

 

 

 

 

Foreign currency exchange rate changes

 

 

 

 

(294

)

 

 

 

92

 

 

 

 

 

 

 

 

(1

)

Curtailments

 

 

 

 

(1

)

 

 

 

(5

)

 

 

 

 

 

 

 

 

Special termination benefits

 

 

 

 

3

 

 

 

 

9

 

 

 

 

 

 

 

 

 

Actuarial loss (gain)

 

 

129

 

 

458

 

 

(100

)

 

39

 

 

30

 

 

1

 

 

(9

)

 

 

Benefits paid

 

 

(86

)

 

(176

)

 

(52

)

 

(169

)

 

(12

)

 

 

 

(14

)

 

(1

)

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Benefit obligation at end of year

 

$

1,001

 

$

3,317

 

$

877

 

$

2,859

 

$

137

 

$

6

 

$

105

 

$

5

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Change in plan assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair value of plan assets at beginning of year

 

$

755

 

$

2,443

 

$

636

 

$

2,237

 

$

 

$

 

$

 

$

 

Actual return on plan assets

 

 

41

 

 

337

 

 

99

 

 

198

 

 

 

 

 

 

 

 

 

Foreign currency exchange rate changes

 

 

 

 

(235

)

 

 

 

79

 

 

 

 

 

 

 

 

 

Participant contributions

 

 

 

 

7

 

 

 

 

9

 

 

3

 

 

 

 

5

 

 

 

Acquisitions/divestitures

 

 

6

 

 

106

 

 

 

 

 

 

 

 

 

 

 

 

 

Company contributions

 

 

45

 

 

105

 

 

72

 

 

89

 

 

9

 

 

 

 

9

 

 

1

 

Benefits paid

 

 

(86

)

 

(176

)

 

(52

)

 

(169

)

 

(12

)

 

 

 

(14

)

 

(1

)

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Fair value of plan assets at end of year

 

$

761

 

$

2,587

 

$

755

 

$

2,443

 

$

 

$

 

$

 

$

—  

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Funded status

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair value of plan assets

 

$

761

 

$

2,587

 

$

755

 

$

2,443

 

$

 

$

 

$

 

$

 

Benefit obligation

 

 

1,001

 

 

3,317

 

 

877

 

 

2,859

 

 

137

 

 

6

 

 

105

 

 

5

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Accrued benefit cost

 

$

(240

)

$

(730

)

$

(122

)

$

(416

)

$

(137

)

$

(6

)

$

(105

)

$

(5

)

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Amounts recognized in balance sheet:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noncurrent asset

 

$

 

$

8

 

$

 

$

20

 

$

 

$

 

$

 

$

 

Current liability

 

 

(6

)

 

(7

)

 

(6

)

 

(6

)

 

(9

)

 

 

 

(9

)

 

 

Noncurrent liability

 

 

(234

)

 

(731

)

 

(116

)

 

(430

)

 

(128

)

 

(6

)

 

(96

)

 

(5

)

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

 

 

$

(240

)

$

(730

)

$

(122

)

$

(416

)

$

(137

)

$

(6

)

$

(105

)

$

(5

)

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Huntsman Corporation

                                                                                                                                                                                    

 

 

Defined Benefit Plans

 

Other Postretirement
Benefit Plans

 

 

 

2014

 

2013

 

2014

 

2013

 

 

 

U.S.
Plans

 

Non-U.S.
Plans

 

U.S.
Plans

 

Non-U.S.
Plans

 

U.S.
Plans

 

Non-U.S.
Plans

 

U.S.
Plans

 

Non-U.S.
Plans

 

Amounts recognized in accumulated other comprehensive loss:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net actuarial loss

 

$

390

 

$

916

 

$

264

 

$

705

 

$

50

 

$

1

 

$

21

 

$

 

Prior service cost

 

 

(29

)

 

(2

)

 

(35

)

 

5

 

 

(23

)

 

 

 

(27

)

 

—  

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

 

 

$

361

 

$

914

 

$

229

 

$

710

 

$

27

 

$

1

 

$

(6

)

$

—  

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Huntsman International

                                                                                                                                                                                    

 

 

Defined Benefit Plans

 

Other Postretirement
Benefit Plans

 

 

 

2014

 

2013

 

2014

 

2013

 

 

 

U.S.
Plans

 

Non-U.S.
Plans

 

U.S.
Plans

 

Non-U.S.
Plans

 

U.S.
Plans

 

Non-U.S.
Plans

 

U.S.
Plans

 

Non-U.S.
Plans

 

Amounts recognized in accumulated other comprehensive loss:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net actuarial loss

 

$

391

 

$

968

 

$

266

 

$

765

 

$

50

 

$

1

 

$

21

 

$

 

Prior service cost

 

 

(28

)

 

(2

)

 

(35

)

 

5

 

 

(23

)

 

 

 

(27

)

 

—  

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

 

 

$

363

 

$

966

 

$

231

 

$

770

 

$

27

 

$

1

 

$

(6

)

$

—  

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

        The amounts in accumulated other comprehensive loss that are expected to be recognized as components of net periodic benefit cost during the next fiscal year are as follows (dollars in millions):

Huntsman Corporation

                                                                                                                                                                                    

 

 

Defined Benefit Plans

 

Other Postretirement
Benefit Plans

 

 

 

U.S. Plans

 

Non-U.S.
Plans

 

U.S. Plans

 

Non-U.S.
Plans

 

Actuarial loss

 

$

31

 

$

45

 

$

3

 

$

 

Prior service cost

 

 

(6

)

 

 

 

(3

)

 

—  

 

​  

​  

​  

​  

​  

​  

​  

​  

Total

 

$

25

 

$

45

 

$

 

$

—  

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Huntsman International

                                                                                                                                                                                    

 

 

Defined Benefit Plans

 

Other Postretirement
Benefit Plans

 

 

 

U.S. Plans

 

Non-U.S.
Plans

 

U.S. Plans

 

Non-U.S.
Plans

 

Actuarial loss

 

$

31

 

$

53

 

$

3

 

$

 

Prior service cost

 

 

(6

)

 

 

 

(3

)

 

—  

 

​  

​  

​  

​  

​  

​  

​  

​  

Total

 

$

25

 

$

53

 

$

 

$

—  

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

        Components of net periodic benefit costs for the years ended December 31, 2014, 2013 and 2012 were as follows (dollars in millions):

Huntsman Corporation

                                                                                                                                                                                    

 

 

Defined Benefit Plans

 

 

 

U.S. plans

 

Non-U.S. plans

 

 

 

2014

 

2013

 

2012

 

2014

 

2013

 

2012

 

Service cost

 

$

27

 

$

31

 

$

26

 

$

32

 

$

38

 

$

32

 

Interest cost

 

 

45

 

 

40

 

 

42

 

 

102

 

 

90

 

 

102

 

Expected return on plan assets

 

 

(56

)

 

(50

)

 

(48

)

 

(138

)

 

(124

)

 

(133

)

Amortization of prior service cost

 

 

(6

)

 

(7

)

 

(6

)

 

 

 

1

 

 

(1

)

Amortization of actuarial loss

 

 

19

 

 

35

 

 

21

 

 

34

 

 

43

 

 

23

 

Settlement loss

 

 

 

 

 

 

 

 

13

 

 

12

 

 

13

 

Special termination benefits

 

 

 

 

 

 

 

 

3

 

 

9

 

 

—  

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Net periodic benefit cost

 

$

29

 

$

49

 

$

35

 

$

46

 

$

69

 

$

36

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

 

                                                                                                                                                                                    

 

 

Other Postretirement Benefit Plans

 

 

 

U.S. plans

 

Non-U.S. plans

 

 

 

2014

 

2013

 

2012

 

2014

 

2013

 

2012

 

Service cost

 

$

3

 

$

4

 

$

4

 

$

 

$

 

$

 

Interest cost

 

 

5

 

 

5

 

 

7

 

 

 

 

 

 

1

 

Amortization of prior service cost

 

 

(4

)

 

(2

)

 

(3

)

 

 

 

 

 

 

Amortization of actuarial loss

 

 

1

 

 

2

 

 

2

 

 

 

 

 

 

—  

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Net periodic benefit cost

 

$

5

 

$

9

 

$

10

 

$

 

$

 

$

1

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Huntsman International

                                                                                                                                                                                    

 

 

Defined Benefit Plans

 

 

 

U.S. plans

 

Non-U.S. plans

 

 

 

2014

 

2013

 

2012

 

2014

 

2013

 

2012

 

Service cost

 

$

27

 

$

31

 

$

26

 

$

32

 

$

38

 

$

32

 

Interest cost

 

 

45

 

 

40

 

 

42

 

 

102

 

 

90

 

 

102

 

Expected return on plan assets

 

 

(56

)

 

(50

)

 

(48

)

 

(138

)

 

(124

)

 

(133

)

Amortization of prior service cost

 

 

(6

)

 

(7

)

 

(6

)

 

 

 

1

 

 

(1

)

Amortization of actuarial loss

 

 

19

 

 

35

 

 

21

 

 

41

 

 

49

 

 

28

 

Settlement loss

 

 

 

 

 

 

 

 

13

 

 

12

 

 

13

 

Special termination benefits

 

 

 

 

 

 

 

 

3

 

 

9

 

 

—  

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Net periodic benefit cost

 

$

29

 

$

49

 

$

35

 

$

53

 

$

75

 

$

41

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

 

                                                                                                                                                                                    

 

 

Other Postretirement Benefit Plans

 

 

 

U.S. plans

 

Non-U.S. plans

 

 

 

2014

 

2013

 

2012

 

2014

 

2013

 

2012

 

Service cost

 

$

3

 

$

4

 

$

4

 

$

 

$

 

$

 

Interest cost

 

 

5

 

 

5

 

 

7

 

 

 

 

 

 

1

 

Amortization of prior service cost

 

 

(4

)

 

(2

)

 

(3

)

 

 

 

 

 

 

Amortization of actuarial loss

 

 

1

 

 

2

 

 

2

 

 

 

 

 

 

—  

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Net periodic benefit cost

 

$

5

 

$

9

 

$

10

 

$

 

$

 

$

1

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

        The amounts recognized in net periodic benefit cost and other comprehensive income (loss) as of December 31, 2014, 2013 and 2012 were as follows (dollars in millions):

Huntsman Corporation

                                                                                                                                                                                    

 

 

Defined Benefit Plans

 

 

 

U.S. plans

 

Non-U.S. plans

 

 

 

2014

 

2013

 

2012

 

2014

 

2013

 

2012

 

Current year actuarial loss (gain)

 

$

144

 

$

(149

)

$

103

 

$

257

 

$

(40

)

$

272

 

Amortization of actuarial loss

 

 

(19

)

 

(35

)

 

(21

)

 

(34

)

 

(43

)

 

(23

)

Current year prior service (credits) cost

 

 

 

 

 

 

(26

)

 

(6

)

 

1

 

 

 

Amortization of prior service cost (credits)

 

 

6

 

 

7

 

 

6

 

 

 

 

(1

)

 

1

 

Settlements

 

 

 

 

 

 

 

 

(13

)

 

(12

)

 

(13

)

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Total recognized in other comprehensive loss (income)

 

 

131

 

 

(177

)

 

62

 

 

204

 

 

(95

)

 

237

 

Net periodic benefit cost

 

 

29

 

 

49

 

 

35

 

 

46

 

 

69

 

 

36

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Total recognized in net periodic benefit cost and other comprehensive (loss) income

 

$

160

 

$

(128

)

$

97

 

$

250

 

$

(26

)

$

273

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

 

                                                                                                                                                                                    

 

 

Other Postretirement Benefit Plans

 

 

 

U.S. plans

 

Non-U.S. plans

 

 

 

2014

 

2013

 

2012

 

2014

 

2013

 

2012

 

Current year actuarial loss (gain)

 

$

30

 

$

(8

)

$

9

 

$

1

 

$

(1

)

$

 

Amortization of actuarial loss

 

 

(1

)

 

(2

)

 

(2

)

 

 

 

 

 

 

Current year prior service credit

 

 

 

 

(22

)

 

 

 

 

 

 

 

 

Amortization of prior service cost

 

 

4

 

 

2

 

 

3

 

 

 

 

 

 

—  

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Total recognized in other comprehensive loss (income)

 

 

33

 

 

(30

)

 

10

 

 

1

 

 

(1

)

 

 

Net periodic benefit cost

 

 

5

 

 

9

 

 

10

 

 

 

 

 

 

1

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Total recognized in net periodic benefit cost and other comprehensive (loss) income

 

$

38

 

$

(21

)

$

20

 

$

1

 

$

(1

)

$

1

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Huntsman International

                                                                                                                                                                                    

 

 

Defined Benefit Plans

 

 

 

U.S. plans

 

Non-U.S. plans

 

 

 

2014

 

2013

 

2012

 

2014

 

2013

 

2012

 

Current year actuarial loss (gain)

 

$

144

 

$

(149

)

$

103

 

$

257

 

$

(39

)

$

272

 

Amortization of actuarial loss

 

 

(19

)

 

(35

)

 

(21

)

 

(41

)

 

(49

)

 

(28

)

Current year prior service (credits) cost

 

 

 

 

 

 

(26

)

 

(6

)

 

1

 

 

 

Amortization of prior service cost (credits)

 

 

6

 

 

7

 

 

6

 

 

 

 

(1

)

 

1

 

Settlements

 

 

 

 

 

 

 

 

(13

)

 

(12

)

 

(13

)

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Total recognized in other comprehensive loss (income)

 

 

131

 

 

(177

)

 

62

 

 

197

 

 

(100

)

 

232

 

Net periodic benefit cost

 

 

29

 

 

49

 

 

35

 

 

53

 

 

75

 

 

41

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Total recognized in net periodic benefit cost and other comprehensive (loss) income

 

$

160

 

$

(128

)

$

97

 

$

250

 

$

(25

)

$

273

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

 

                                                                                                                                                                                    

 

 

Other Postretirement Benefit Plans

 

 

 

U.S. plans

 

Non-U.S. plans

 

 

 

2014

 

2013

 

2012

 

2014

 

2013

 

2012

 

Current year actuarial loss (gain)

 

$

30

 

$

(8

)

$

9

 

$

1

 

$

(1

)

$

 

Amortization of actuarial loss

 

 

(1

)

 

(2

)

 

(2

)

 

 

 

 

 

 

Current year prior service credit

 

 

 

 

(22

)

 

 

 

 

 

 

 

 

Amortization of prior service cost

 

 

4

 

 

2

 

 

3

 

 

 

 

 

 

—  

 

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

​  

Total recognized in other comprehensive loss (income)

 

 

33

 

 

(30

)

 

10

 

 

1

 

 

(1

)

 

 

Net periodic benefit cost

 

 

5

 

 

9

 

 

10

 

 

 

 

 

 

1