ManpowerGroup 2007 Annual Report Download - page 60

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Manpower 2007 Annual Report
Notes to Consolidated Financial Statements
We use a December 31 measurement date for the retiree health care plan. The discount rate used in the measurement of
the benefi t obligation was 6.4% and 5.8% in 2007 and 2006, respectively. The discount rate used in the measurement of net
periodic benefi t cost was 5.8%, 5.5% and 5.8% in 2007, 2006 and 2005, respectively. The components of net periodic benefi t
cost for this plan are as follows:
Year Ended December 31 2007 2006 2005
Net Periodic Benefi t Cost
Service cost $ 0.3 $ 0.4
$ 0.4
Interest cost 1.3 1.1 1.3
Net gain (0.4) (0.6) (0.3)
Net periodic benefi t cost 1.2 0.9 1.4
Other Changes in Plan Assets and Benefi t Obligations
Recognized in Other Comprehensive Income
Net gain (1.4) ——
Amortization of net gain 0.4 ——
Total recognized in other comprehensive income (1.0) ——
Total recognized in net periodic benefi t cost and other comprehensive income $ 0.2 $ 0.9 $ 1.4
The estimated net gain for the retiree health care plan that will be amortized from Accumulated Other Comprehensive Income
into net periodic benefi t cost during 2008 is $0.6.
The health care cost trend rate was assumed to be 8.5% for 2007, decreasing gradually to 5.0% for the years 2014 and
beyond. Assumed health care cost trend rates have a signifi cant effect on the amounts reported. A one-percentage point
change in the assumed health care cost trend rate would have the following effects:
1% Increase 1% Decrease
Effect on total of service and interest cost components $ 0.2 (0.2)
Effect on benefi t obligation 2.6 (2.4)
We plan to contribute $19.3 to our pension plans and $1.5 to our retiree health care plan in 2008. Projected benefi t payments
from the plans as of December 31, 2007 are estimated as follows:
Year Pension Plans Retiree Health
2008 $ 9.5 $ 1.5
2009 10.1 1.5
2010 10.2 1.6
2011 10.9 1.7
2012 11.8 1.7
2013-2017 66.7 8.8
Total projected benefi t payments $ 119.2 $ 16.8
Defi ned Contribution Plans
We have defined contribution plans covering substantially all permanent U.S. employees and various other employees
throughout the world. Employees may elect to contribute a portion of their salary to the plans and we match a portion of their
contributions up to a maximum percentage of the employee’s salary. In addition, profi t sharing contributions are made if a
targeted earnings level is reached. The total expense for our match and any profi t sharing contributions was $22.9, $20.6 and
$22.9 for 2007, 2006 and 2005, respectively.
We have the Senior Management Performance-Based Deferred Compensation Plan, which was frozen effective February 1,
2006. No benefi ts were earned in 2007 and 2006, however any deferred benefi ts earn interest based on the effective yield on a
fi xed 10-year U.S. Treasury note at the beginning of each year. Participants become vested in the deferred benefi ts if they are
still employed by Manpower when they reach age 50 with 15 years of service, when they reach age 62, or in certain other
circumstances. There was approximately $0.1, $0.2 and $1.4 earned under this plan in 2007, 2006 and 2005, respectively.
We also maintain a non-qualifi ed deferred compensation plan for certain employees at Right Management. Under the plan,
participants may defer from their pre-tax income, up to a maximum of 6% of their total compensation. A matching contribution
is made of 50% of the participating employees’ contributions to the plan. Contributions vest at 33.3% over a three-year period
from the employee’s date of hire. Our contributions were $0.1 for 2007 and 2006, and $0.2 for 2005.