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 2014 is $138,500 Cdn) multiplied by the number of years of credited service, and
  • The supplemental plan provides for additional benefits of 2.50% (2.25% for Messrs. Steven Ridolfi and Éric Martel) of average base salary, for NEOs, multiplied by the number of years of credited service (up to 40) less the pension payable from the basic plan.

Mr. Steven Ridolfi was also entitled to an additional benefit of 0.25% of his average base salary multiplied by the number of years of credited service up to September 1, 2013; this additional benefit accumulates over a period of 5 years from January 1, 2014 to December 31, 2018. Effective from January 1, 2014, he also received an annual contribution in a non-registered retirement savings plan of 5% of his base salary. On February 27, 2015, Mr. Steven Ridolfi left the Corporation and retired.

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. 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.

Benefits are payable upon retirement from age 60. For Messrs. Pierre Beaudoin, Pierre Alary, Steven Ridolfi and Éric Martel, benefits can be paid before age 60, in which case benefits are reduced by 0.33% for each month between the date of early retirement and the participant’s 60th birthday or, if earlier, the date at which the participant’s age plus years of service total 85.

All NEOs have reached the service requirements for vested rights in case of termination.

Upon the death of Messrs. Pierre Beaudoin, Pierre Alary, Steven Ridolfi and Éric Martel, 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, 2014 and December 31, 2014.

Read the Supplementary Pension Disclosure table for the financial year ended December 31, 2014 

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 Executive Chairman, the President and Chief Executive Officer 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 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, 2014.