Pension Plans

The Named Executive Officers participate in two defined benefit pension plans which are non-contributory:

  • Benefits payable from the basic plan correspond to 2% of average base salary in the three continuous years of service during which the NEOs are paid their highest salary (up to the maximum earnings according to the Income Tax Act (Canada) which for 2013 is $134,834 Cdn) multiplied by the number of years of credited service, and
  • The supplemental plan provides for additional benefits of 2.50% of average base slary, for NEOs, multiplied by the number of years of credited service (up to 40) less the pension payable from the basic plan.

Bonuses paid under the short-term incentive plans and any other form of compensation are not considered in the computation of pension benefits.

Upon employment, Mr. Guy C. Hachey was granted the right to accrue a pension at double the annual accrual rate, or 5.0%, for each year of service completed for his first seven years of employment.

Upon employment, Mr. Lutz Bertling was granted the right to accrue a pension at double the annual rate, or 5.0%, for each of his first three years of service completed to compensate for the forfeiture of pension entitlements at his prior employment.

The HRCC has granted to Mr. André Navarri the right to accrue, starting on April 1, 2010, his pension at an additional rate of 1.25% of the annual accrual, representing 3.75% for the next six years of his employment. Considering that Mr. André Navarri informed the Corporation of his intention to voluntarily retire as of June 1, 2014, the HRCC has decided to grant Mr. André Navarri an additional 11 months of credited service at the annual accrual rate of 2.5% as of June 1, 2014 in order to provide Mr. André Navarri his full pension.

Benefits are reduced by 0.33% for each month between the date of early retirement and the date of a participant’s 60th birthday or for Messrs. Beaudoin, Alary, Hachey and Desjardins, if earlier, the date at which the participant’s age plus his years of service total 85.

No benefits are payable from the supplemental plan if a participant has not completed 5 years of service, except for Messrs. Guy C. Hachey and Lutz Bertling, who have an immediate right to their accrued pension upon termination.

Upon the death of Messrs. Beaudoin, Alary, Hachey, Desjardins and Navarri, their spouse will be entitled to a benefit equal to 60% of the benefit to which such participant was entitled. If the participant has no spouse at the time of retirement, the benefits will be paid, after death, to the designated beneficiary until such time as 120 monthly installments, in the aggregate, have been paid to the participant and/or to the designated beneficiary. For Mr. Lutz Bertling, in the event of his death, the life partner designated by Mr. Lutz Bertling before his death shall receive 50% of his monthly retirement benefit. If his life partner is more than ten years younger, the lifetime pension will be reduced by 0.3% for each year of age difference in excess of the ten years.

All pension benefits payable from these plans are in addition to government social security benefits.

Supplemental Pension Disclosure

The PDF link below sets forth the reconciliation of the total obligations under the basic and the supplemental plans with respect to the pension benefits payable to each of the Named Executive Officers of Bombardier between January 1, 2013 and December 31, 2013.

Read the Supplementary Pension Disclosure table for the financial year ended December 31, 2013 

Pension Plans, Benefits and Perquisites

The objective of Bombardier is to provide pension, benefits and perquisites at the median of the market. Benefit plans for executives are, as a general rule, similar to those of non-unionized employees, except however that higher limits would apply to life insurance, long-term disability, medical services and dental care coverage.

Bombardier offers a limited number of perquisites such as car lease, complete medical check-up and financial counselling.

  • The amount allocated for the leasing of a company provided car depends on the level of responsibility of executives; executives are allowed to exceed such amount but are required to pay the excess through payroll deductions. Bombardier reimburses reasonable expenses for the use and maintenance of the car.
  • All executives are entitled to have an annual complete medical check-up.
  • Bombardier assumes the annual fees incurred by selected executives for financial counselling up to a maximum amount of $3,000 Cdn.
  • As a general rule, Bombardier does not reimburse any fitness club, sport club or business club membership fees.

The President and Chief Executive Officer, the President and Chief Operating Officer of Bombardier Aerospace and the President and Chief Operating Officer of Bombardier Transportation are allowed to use the Bombardier corporate aircraft for personal reasons. Bombardier does not generally assume all of the costs of corporate aircraft incurred for personal use since all or part of these costs must be reimbursed to Bombardier, in an amount equal to the fair market value of a first class commercial airlines ticket for the destination of the personal trip for each person travelling aboard the corporate aircraft. The difference, if any, between the incremental operating costs to Bombardier and the costs reimbursed by the Named Executive Officer is included in the amounts required to be disclosed as perquisites, as applicable, under the column “All Other Compensation”, in the “Summary Compensation Table”.

Supplemental Information

Since Bombardier has a policy of not granting loans to any of its employees, there is no outstanding loan for the financial year ended December 31, 2013.