legacy cost

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Legacy Cost

Ongoing costs to a company that come from funding activities that, by definition, do not increase revenue. Perhaps the most prominent example of legacy costs is the funding of pension plans. Legacy costs often accrue when a company takes on too many responsibilities in times of strong performance or when it takes on an appropriate level of responsibility and then its priorities change. Critics of legacy costs contend that they make industry uncompetitive, while proponents, notably labor unions, argue they are part of an employer's moral obligation to its employees.

legacy cost

The financial expense of supporting retiree benefits, including pensions, heath care, and insurance. Legacy cost is especially burdensome for mature companies with declining markets and a shrinking labor force.
References in periodicals archive ?
b) The three months ended March 31, 2014 includes $10 million related to the loss on early extinguishment of debt and $1 million of former parent legacy costs.
Directors said Atom represents the first real alternative to traditional High Street Banks and is free of the existing banks' branch and legacy costs.
The bank is being billed as an alternative to traditional high street banking and is free of the existing banks' branch and legacy costs.
Based on current literature and practices of organisations active in energy market analysis (IEA, OECD, EEA, FP7/JRC, IRENA, WEC, EIU, BNEF and relevant national institutes), an appropriate methodology and framework for calculating energy costs and subsidies should be elaborated in agreement with DG ENER, covering: costs and subsidies on both the production and consumption sides, transmission and distribution network and storage, direct and indirect (including legacy costs, external costs and the analysis of their internalisation), system costs, financial and regulatory costs (e.
We will retain about two-thirds of our 60 stores, tighten our corporate structure, and shed legacy costs.
Greek telecoms giant OTE plans to cut 1,100 jobs at its domestic fixed-line business, in the former state monopoly's latest move to reduce legacy costs.
Route support: PS121,123; A further PS15,000 is going towards legacy costs and PS43,000 to British Cycling for a two-year SKyride project to boost cycling sKills of KirKlees residents.
3 billion in health care and pension benefits it owes are "substantial and unsustainable legacy costs.
Second, to restructure the debt and legacy costs while operations continue.
This theory would do away with overhead, health insurance, retirement payments, and any other legacy costs.
The MBTA has significant legacy costs that derive from years of high wages and very generous retirement and pension rules.
Contrary to what Jens Weidman, and the three leaders, have said this week, it is precisely the legacy costs of the banking bust, as the INET Euro Council report argues, that need to be shared," Garicano said.