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Pay, salaries and bonuses

All Group employees are hired through national collective labour agreements, with the exception of project-based contract workers, who do not have a collective labour agreement, covering 0.3% of average employees in 2011. Employees with staff leasing contracts, amounting to 0.8% of average workers in 2011, have the same economic conditions as those provided in the contracts applied to employees with open-ended contracts (including the performance bonus).

Relation between minimum pay and salary conditions according to labour agreements and Hera pay and salary levels (Federgasacqua contract - 2011)
EuroMin. pay/salary (according to lab. agr.)
(A)
Min. pay/salary (Hera)
(B)
% Gap
(B:A)
Average Hera compensation
(C)
% Gap
(C:A)
Middle managers2,6592,8949%4,25460%
Employees1,4831,4830%2,45766%
Workers1,4831,4830%2,14645%

The data refer to the following companies: Hera S.p.A., Famula on Line, Uniflotte, Hera Comm, Hera Trading, Herambiente, FEA.

The table illustrates the gaps between gross monthly pay/salary levels at Hera and those specified by the Federgasacqua labour agreement, which governs the employment relationship of 47% of Group workers. Comparison between the minimum pay/salary conditions of the Federgasacqua contract and the minimum applied by Hera was conducted by considering the minimum seniority conditions within the Group for the three employment classes. Comparison was also conducted by taking into account average pay/salary levels for the three classes.
The gap between the minimum level applied by Hera and that envisaged by the labour agreement is 9% for middle managers and in line with the contractual figure for white-collar and blue-collar workers. The average salary, on the other hand, is 60% higher than the minimum labour agreement conditions for middle managers, 66% higher for white-collar workers and 45% higher for blue-collar workers.

Relation between senior management compensation according to labour agreements and Hera levels (Confservizi contract)
Euro2011
Minimum according to labour agr. (A)4,385
Hera minimum (B)5,385
% Gap (B:A)23%
Average Hera compensation (C)9,528
% Gap (C:A)117%
Average market salary for managers10,092
% difference compared to the market-6%

Data do not include Marche Multiservizi.

The above table illustrates the gaps between average gross compensation levels and the gross compensation levels envisaged by the national collective labour agreement for the senior management class. For this class, the contract to which reference is made is that of the local public services providers' association, Confservizi.
The average salary of Hera managers is 117% higher than the minimum salary stipulated in the contract, while the minimum salary is 23% higher than the Confservizi contract.
The average salary of Hera managers is 6% lower than the average market salaries for managers, as these are reported in the Hay Compensation Report - Total Cash Italia 2011.

 
Average salaries by gender (2011)
EuroMenWomen
Managers9,7898,114
Middle managers4,2464,271
Employees2,5232,361
Workers2,1522,039

Regarding employees and workers, compensation is slightly lower for women. The gap between female and male employees is slightly larger, since men account for 66% of management employees. Instead, the salary gap between men and women within the management class is significant (approximately Euro 1,700), but this figure is influenced by the fact that there are fewer female directors than male: in fact, in 2011, out of 33 Group directors, 4 were women.

Gross performance bonus (per capita)
Euro200920102011
Middle managers1,7551,5341,541
Employees1,4951,3181,325
Workers1,3871,2211,228
Weighted average1,4521,2891,297

The data refer to the following companies: Hera S.p.A., Famula on Line, Uniflotte, Hera Comm, Hera Trading, Herambiente, FEA.

In line with the Group Supplementary Collective Labour Agreement stipulated on 24 March 2010, the 2011 performance bonus for managers, employees and workers is based on profitability, productivity and sustainability indicators.
The profitability and productivity indices consist of the Group's gross operating margin and the per capita gross operating margin of the companies belonging to the Group and the territorial operating structures.
The main sustainability indices for 2011 (which have an impact of up to 20%) include: reduction in the number of claims, percentage of separate waste collection, commercial quality standards defined by AEEG, compliance with the standards defined in the water service charter, indices of accident frequency, severity and rate, near-accident indices, water supply activation times, percentage of the water network subject to active research for losses, business and residential customer satisfaction index, and average arrival time after emergency calls.
The 24 March 2010 agreement identified the amount of the performance bonus in 2010-2012, as well as the portions which are assigned to personnel as consolidated productivity during the three years, and are subtracted from the overall bonus amount.

Other incentive systems

Starting from 2006, the incentive system for managers of the Hera Group has been linked to the balanced scorecard. This system was introduced to the Group gradually through an initial application to senior managers and middle managers and a subsequent extension to all managers. According to this system, the variable component of individual compensation for managers and middle managers is calculated as a percentage value of gross annual salaries and is defined at the end of the year on the basis of results obtained relative to the objectives set at the start of the year.
The balanced individual scorecard is structured in three parts:

  • the first consists of specific project-objectives deriving from translation in operating terms of the objectives contained in the Group's strategic map;
  • the second contains the economic objectives defined in the budget for the year;
  • the third involves an assessment on the behaviours set forth in the Group leadership model.

The structure of the balanced individual scorecard, or the weights assigned to the three areas, vary according to the seniority of the employee and the department.
The final assignment of the bonus is weighted according to the results reached insofar as certain Group parameters: financial-economic results and customer satisfaction index for residential customers.
The assignment of the objectives to employees and the assessment of their achievement takes place through a clearly defined process which is based on the decision of the top management for the individual balanced scorecards of the directors and managers and of the directors for the individual balanced scorecards of the managers. The activity takes place with the coordination of the Balanced Scorecard System Management function within the Corporate Social Responsibility Department and personnel departments.
Approximately 51% of the variable remuneration of senior management of the Hera Group is linked to the completion of the projects planned in the balanced scorecard system (the remaining 49% is linked to respect of budget objectives and compliance with the behaviours set forth in the leadership model).
A total of 422 managers and middle managers received a bonus linked to the balanced scorecard in 2011. This is added to 233 employees who received an incentive bonus in the forms provided by the merit-based policies of the Group in 2011.

 

Sustainability in the management bonus system and in the performance bonus

Aspects that refer to sustainability are present in the incentive system for managers and middle managers and the systems for the determination of the performance bonus used by the Group.
The performance bonus is influenced by indicators that are connected to quality and the environment while the incentive system connected to the balanced scorecard provides for a part of the incentive to be connected to the achievement of sustainability projects.
In 2011, 24% of the variable remuneration of Group managers and middle managers was linked to sustainability project objectives (improvement of quality, environmental impact, image, personnel involvement, professional development and involvement of stakeholders).
A maximum of 20% of the performance bonus for managers, employees and workers is linked to quality, environmental and occupational safety objectives.

Le segnalazioni per stakeholder 2008-2011


Pension funds

The number of employees participating in the pension funds as at December 2011 is 4,488, or around 69% of total employees.
The Hera Group has three main pension funds created through national collective labour agreements: Pegaso for employees under the gas-water and electricity national collective labour agreements, Previambiente for employees under the Federambiente national collective labour agreement, and Previndai for managers. 94% of total employees enrolled in pension funds are enrolled in these three funds. There is a slight decrease in enrolment since new hires do not always enrol, and instead may decide to contribute TFR (employee leaving indemnities) to the INPS treasury fund.
The table below sets forth the yield of the balanced subfund within the two main pension funds, which comprise 92% of workers participating in the pension funds.

Yield of the main pension funds (balanced subfund)
%200920102011
Pegaso9.11%4.82%1.40%
Previambiente 9.53%4.66%0.07%