Annual report pursuant to Section 13 and 15(d)

Employee Benefits

Employee Benefits
12 Months Ended
Dec. 28, 2019
Employee Benefits [Abstract]  


As of December 28, 2019, the Company had three defined contribution retirement plans, under the provisions of Section 401(k) of the Internal Revenue Code, covering substantially all of its eligible U.S. employees.  Employer contribution costs recognized under the retirement plans amounted to approximately $3,511, $3,807, and $3,290 during 2019, 2018, and 2017, respectively. Effective January 1, 2020, the plans were merged into a single plan.


The Company provides supplemental pension benefits to its employees of foreign operations in addition to mandatory benefits included in local country payroll statutes.  These benefits amounted to approximately $1,905, $1,865, and $328 during 2019, 2018, and 2017, respectively.

In the U.S., Sun Hydraulics used an Employee Stock Ownership Plan (“ESOP”) to make discretionary contributions to employees who were eligible participants in its 401(k) retirement plan.  Under the ESOP, which was 100% company funded, the Company allocated common stock to each participant's account. The allocation was generally a percentage of a participant’s compensation as determined by the Board of Directors on an annual basis. There were no restrictions on the shares contributed to the ESOP, which allowed participants to sell their shares within their individual 401(k) accounts.  The Company does not have any repurchase obligations under the ESOP.  Effective January 1, 2019, the Company terminated the ESOP feature of the 401(k) plan and replaced it with a company stock fund in the 401(k) plan.  The company stock fund will be used in the future for discretionary contributions.

The Company contributed 23,551 shares into the ESOP in March 2019.  The Company did not contribute to the ESOP during 2018. The Company incurred retirement benefit expense under the ESOP of approximately $898 and $1,152 during 2019 and 2018, respectively.  These amounts are included in the total employer contributions to the retirement plan noted above.