HP 2008 Annual Report Download - page 141

HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
Note 15: Retirement and Post-Retirement Benefit Plans (Continued)
projected benefit obligations for the U.S. defined benefit plans combined with the DPSP as of the
September 30 measurement date is as follows for the following fiscal years ended October 31:
2008(1) 2007
Projected Projected
Benefit Benefit
Plan Assets Obligation Plan Assets Obligation
In millions
U.S. defined benefit plans ....................... $7,313 $7,654 $4,258 $3,982
DPSP ...................................... 910 910 1,029 1,029
Total ..................................... $8,223 $8,564 $5,287 $5,011
(1) 2008 plan assets and projected benefit obligation include the EDS U.S. pension plans.
Post-Retirement Benefit Plans
Through fiscal 2005, substantially all of HP’s U.S. employees at December 31, 2002 could become
eligible for partially subsidized retiree medical benefits and retiree life insurance benefits under the
Pre-2003 HP Retiree Medical Program (the ‘‘Pre-2003 Program’’) and certain other retiree medical
programs. Plan participants in the Pre-2003 Program make contributions based on their choice of
medical option and length of service. U.S. employees hired or rehired on or after January 1, 2003 may
be eligible to participate in a post-retirement medical plan, the HP Retiree Medical Program but must
bear the full cost of their participation. Effective January 1, 2006, employees whose combination of age
and years of service was less than 62 no longer were eligible for the subsidized Pre-2003 Program, but
instead were eligible for the HP Retiree Medical Program. Employees no longer eligible for the
Pre-2003 Program, as well as employees hired on or after January 1, 2003, are eligible for certain
credits under the HP Retirement Medical Savings Account Plan (‘‘RMSA Plan’’) upon attaining age 45.
Upon retirement, former employees may use credits under the RMSA Plan for the reimbursement of
certain eligible medical expenses, including premiums required for participation in the HP Retiree
Medical Program. In February 2007, HP further limited future eligibility for the Pre-2003 HP Retiree
Medical Program to those employees who were within five years of satisfying the program’s retirement
criteria on June 30, 2007. Employees not meeting the modified program criteria may become eligible
for participation in the HP Retiree Medical Program. In November 2008, HP announced that it was
changing the limits on future cost-sharing for the Pre-2003 Program whereby all future cost increases
will be paid by participating retirees starting in 2011.
Defined Contribution Plans
HP offers various defined contribution plans for U.S. and non-U.S. employees. Total defined
contribution expense was $548 million in fiscal 2008, $481 million in fiscal 2007 and $430 million in
fiscal 2006. U.S. employees are automatically enrolled in the Hewlett-Packard Company 401(k) Plan
(the ‘‘HP 401(k) Plan’’) when they meet eligibility requirements, unless they decline participation.
Similar to HP, EDS offered participation in defined contribution plans for U.S. and non-U.S.
employees. Since the acquisition date of August 26, 2008, global defined contribution expense for EDS
plans totaled $21 million.
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