Access to the “Retirement Income Guarantee for former senior managers” was closed on 31 December 2015. This scheme, created on 1 January 2001, was open to former senior managers of L’Oréal who, in addition to fulfilling the requirement of having ended their career with the Company, met the condition of holding senior manager status for at least ten years at the end of their career. It entitles beneficiary retirees to payment of a life annuity, and to payment, after their death and subject to conditions, to their spouse and/or ex-spouse(s) of a surviving spouse pension and, to the children, of an orphan pension. The calculation base is the average of the salaries for the best three years out of the seven calendar years prior to the end of the senior manager’s career at L’Oréal. The income guarantee is calculated on the basis of the number of years of professional service in the Company up to 31 December 2019, up to a limit of 25 years. The amount of the Guarantee is progressively and regularly increased by 1.8% each year. The pension cannot exceed 50% of the calculation base or exceed the average of the fixed part of the salaries. A gross annuity and gross lump sum equivalent are then calculated, taking into account the sum of the annual pensions accrued by beneficiaries as a result of their professional activity and assuming that their retirement age is 65. The life annuity is the result of the conversion into an annuity at the beneficiaries’ actual age on the date they apply for their pension of the gross lump sum equivalent, less the amount of all payments due as a result of termination of the employment contract, excluding any paid notice period and paid holiday, and less all salaries paid under any early retirement leave. Around 330 senior managers are eligible for these schemes if they fulfil all conditions after ending their career with the Company.
Access to the “Pension Cover for Members of the Comité de Conjoncture” (Garantie de Retraite des Membres du Comité de Conjoncture) was closed on 31 December 2000. This former scheme granted entitlement, to beneficiary retirees who ended their career with the Company, of a life annuity as well as, after their death, the payment under certain conditions to the spouse and/or ex-spouse(s) of a surviving spouse pension and, to the children, of an orphan pension. The calculation base for the Pension Cover is the average of the salaries for the best three years out of the seven calendar years prior to the end of the beneficiary’s career at L’Oréal. The Pension Cover is calculated on the basis of the beneficiary’s number of years’ service, with a ceiling of 40 years, it being specified that at the date of closure of the scheme, on 31 December 2000, the minimum length of service required was 10 years. The Pension Cover may not exceed 40% of the calculation base, plus 0.5% per year for the first twenty years, then 1% per year for the following twenty years, nor exceed the average of the fixed part of the salaries. Around 120 senior managers (active or retired) are eligible for this scheme subject to the requirement, for those in active employment, that they fulfil all the conditions after having ended their career with the Company.
On 1 January 2023, the Collective Retirement Savings Plan (PERCO) was converted into a company collective retirement savings plan (PER COL) in accordance with the Pacte law. Since 2003, L’Oréal has offered employees an opportunity to build retirement savings under the PER COL. If the profit sharing is placed in the PER COL, a 100% matching contribution is paid by the Company on the first €1,200 gross and 50% thereafter (capped at €4,600/year total PER COL employer contributions). For employees who pay 100% of their profit sharing into the PER COL for five consecutive years, an employer contribution of €600 gross is paid into the PER COL (Club PER COL) in the fifth year. Since 2021, an additional employer contribution of €150 gross has been paid from the sixth consecutive year in which 100% of the profit sharing has been invested into the PER COL. Each year, employees may also transfer 10 days of saved leave time (Compte Épargne Temps – CET) in the PER COL. An additional employer contribution of 20% is paid for these days.
Pre-retirement arrangements: L’Oréal pays close attention to its employees’ retirement conditions. The existing arrangements are, in particular:
In order to increase the special leave prior to retirement, employees may opt to convert all or part of their retirement indemnities into time, or may choose to receive payment of all or part of the retirement indemnities, which will be made at the time they leave the Company. These commitments are guaranteed by external financial cover aimed at gradually building up funds derived from premiums paid to external organisations.
The CET can finance a shift to part-time working from the age of 55, early retirement, increased retirement income, providing a retirement lump sum(1)CET savings are valued on the basis of the employee’s final salary., by taking the opportunity to transfer a maximum of 10 days per year to the defined contribution scheme or the L’Oréal PER COL(2)CET days transferred to the PERCO attract an employer contribution of 20%..
For more than 40 years, L’Oréal has provided employees aged 55 and older with the opportunity to take part in a three-day seminar, “Retirement: switching to a new life plan”. A new learning course entitled “My retirement savings solutions” is also available to employees over 40 years of age.
Employee benefit schemes in France: In addition to the compulsory guarantees provided for by the collective bargaining agreements, L’Oréal has set up, in France, under an agreement, an employee benefit scheme providing additional collective guarantees to its employees. All these guarantees are based on gross income and can total up to eight times the French annual social security ceiling. They are generally financed on Brackets A, B, and C of income, except for the Education Annuity which is based on Brackets A and B, and the Surviving Spouse Pension which is based on Brackets B and C. This employee benefit scheme provides the following benefits:
