Remuneration policies applied by Telecom Italia are aimed at ensuring equity, in-house coherence and competitiveness with the external market, by acknowledging and recognizing the contribution that each person makes towards the achievement corporate objectives
Remuneration policy
Including a fixed and a variable component
The management of the fixed component is based on selectivity criteria and is aimed at gratifying first and foremost people with excellent performance standards, in charge of key roles and competencies, bearing in mind the individual performance trend and the remuneration positioning in relation to the external market.
The variable remuneration component is more and more considered as an element connected with the achievement of corporate results and individual performance.
What is Remuneration Policy?
The overall economic value of all the elements, of a monetary and non monetary nature, forming the remuneration package of each employee corresponds to the Total Remuneration.
Elements of a monetary kind are as follows: fixed remuneration, variable remuneration. Elements of a non-monetary kind are as follows: benefits and potential shareholding plans.
What is Fixed Remuneration?
Technically called Gross Annual Earnings (GAE) – it is our salary, and it is established by a number of components that have been established in the Collective Contract. It may possibly be integrated with pay rises on a one-to-one basis. It is influenced by corporate policies, aimed at ensuring coherence within the Group and with the labour market, as well as the development of contractual terms and conditions (work contract renewal, trade union agreements).
What is Variable Remuneration?
It includes remuneration types of an aleatory nature that award the attainment of specific objectives. These may be of a collective or individual nature.
- Individual incentives are types of variable remuneration connected to the accomplishment of performance/objectives (such as, MBOs, Sales Programmes, non-recurrent bonuses), linked to the person’s activities and/or department the person works for.
- Collective incentives are all those kinds of variable remuneration established at a collective level and linked to the achievement of pre-established corporate objectives or specific organisational areas. They usually include all employees, except for those who are already receiving specific individual incentives.
What is the MBO system?
The MBO system (Management By Objectives) is the annual incentive instrument aimed at Managers, connected to both the Company’s performance and specific objectives related to the person’s activities and the department the person works in.
Top Managers and a selected group of Managers are also included in a long term incentive system, whose reward is connected to the company’s performances within a three-year to five-year time range, in order to guarantee the sustainability of long term corporate objectives.
As far as commercial roles are concerned (sales and planning) a dedicated incentive system is considered, which measures the level of achievement of commercial objectives (Commercial Incentives Plan).
Formalized variable remuneration for the remaining personnel is represented by the Performance Bonus, which is defined at collective level and is linked to corporate objectives as well as objectives of the company department the person works for.
An additional type of variable remuneration is provided by the non-recurrent bonus.
This is a different type of remuneration compared to the previous ones because it is independent of achieved results within assigned activities and/or extraordinary efforts in view of important objectives/projects.
Telecom Italia pays particular attention to goods and services offered to its personnel (benefits), with the purpose of increasing the overall remuneration package in all the component elements, including non monetary ones.
On top of contractual benefits – such as social security and complementary assistance (for example, supplementary pension funds, supplementary medical assistance etc.) – a number of benefits are offered in a differentiated way depending on the category of employee (i.e. cars, soft loans, medical check-ups etc.), regulated by specific corporate guidelines.