DuPont 2010 Annual Report Download - page 92

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E. I. du Pont de Nemours and Company
Notes to the Consolidated Financial Statements (continued)
(Dollars in millions, except per share)
21. LONG-TERM EMPLOYEE BENEFITS
The company offers various long-term benefits to its employees. Where permitted by applicable law, the company
reserves the right to change, modify or discontinue the plans.
In 2006, the company announced major changes to the pension and defined contribution benefits that cover the
majority of its U.S. employees. Such employees hired in the U.S. after December 31, 2006 are not eligible to participate
in the pension and post-retirement medical, dental and life insurance plans but receive benefits in the defined
contribution plans.
Defined Benefit Pensions
The company has both funded and unfunded noncontributory defined benefit pension plans covering a majority of the
U.S. employees. The benefits under these plans are based primarily on years of service and employees’ pay near
retirement. The company’s funding policy is consistent with the funding requirements of federal laws and regulations.
Pension coverage for employees of the company’s non-U.S. consolidated subsidiaries is provided, to the extent
deemed appropriate, through separate plans. Obligations under such plans are funded by depositing funds with
trustees, covered by insurance contracts, or remain unfunded.
Other Long-term Employee Benefits
The parent company and certain subsidiaries provide medical, dental and life insurance benefits to pensioners and
survivors, and disability and life insurance protection to employees. The associated plans for retiree benefits are
unfunded and the cost of the approved claims is paid from company funds. Essentially all of the cost and liabilities for
these retiree benefit plans are attributable to the U.S. parent company plans. The retiree medical plan is contributory
with pensioners and survivors’ contributions adjusted annually to achieve a 50/50 target sharing of cost increases
between the company and pensioners and survivors. In addition, limits are applied to the company’s portion of the
retiree medical cost coverage.
Employee life insurance and disability benefit plans are insured in many countries. However, primarily in the U.S., such
plans are generally self-insured or are fully experience-rated. Obligations and expenses for self-insured and fully
experience-rated plans are reflected in the figures below.
F-33