Employees’ total compensation is paid, for one, in the form of a fixed salary in line with market conditions and, for another, in the form of variable compensation.
The amount of the fixed salary is based on the activities, role, and position of the given employee, as well as their individual experience and expertise. Any relevant statutory requirements and contracts under collective bargaining agreements or works agreements are complied with as applicable. The amount of the variable compensation is contingent on the achievement of stipulated targets. Depending on the given employee’s role, both qualitative and quantitative targets are agreed (in particular EBIT and ROCE). Targets are usually set for one business year at a time.
As far as managing directors and executives are concerned, there are limits on the maximum possible variable compensation and the weighting of targets. Compensation packages for all other employees are determined by each individual company in line with market conditions, taking into account both local practice and local requirements. Various compensation elements are possible, including non-monetary elements:
- Pension plans (e.g. in Austria, a pension fund)
- Insurance (e.g. accident insurance)
- Employer-subsidized meals
The compensation packages of managing directors and executives always include variable compensation (bonus) and, in some cases, both a pension plan and a company car.