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FINANCIAL AND ACCOUNTING INFORMATION
1. 2016 Consolidated Financial Statements
223
SAINT-GOBAIN
- REGISTRATION DOCUMENT 2016
(€55.8 million at December 31, 2015).
Provisions for pensions and other post-employment benefits
(defined benefit obligations [DBO] in respect of
length-of-service awards and pensions) accruing to Group
management totaled €47.0 million at December 31, 2016
employee benefits
Provisions for pensions and other
4.3
Description of defined benefit plans
4.3.1
and regulations in the respective countries in which the
Group operates. There are also additional pension obligations
After retirement, the Group’s former employees are eligible
for pension benefits in accordance with the applicable laws
countries.
in certain Group companies, both in France and in other
The Group’s obligation for the payment of pensions and
unfunded portion.
country. These obligations may be financed by pension funds,
with a provision recognized in the balance sheet for the
projected unit credit method, taking into account changes in
salaries until retirement and the economic conditions in each
length-of-service awards is determined at the end of the
reporting period by independent actuaries using the
are recognized in equity.
pension assets”. These assets are capped at the level of future
economic benefits they provide. Changes in the asset ceiling
When plan assets exceed the defined benefit obligation, the
excess is recognized in other non-current assets under “net
rates applied. They are recognized against equity as and
when they arise.
assumptions, experience adjustments and the difference
between the funds’ actual rates of return and the discount
Actuarial gains and losses result from changes in actuarial
beginning of the period, and are recognized as financial
income or expense.
related plan assets are measured by the Group using the
discount rate applied to estimate the obligation at the
The interest cost of these obligations and the return on the
The Group’s main defined benefit plans are as follows:
agreements.
retirement based on years of service and the calculation
methods prescribed in the applicable collective bargaining
In France, employees receive length-of-service awards on
was set up by Compagnie de Saint-Gobain.
defined benefit plan complying with Article L. 137-11 of
France’s Social Security Code (Code de la sécurité sociale)
plans were closed to new entrants by the companies
concerned between 1969 and 1997. Effective March 1, 2012, a
In addition to length-of-service awards, there are three
defined benefit plans, all of which are final salary plans. These
disability benefits for employees. These plans have been
closed to new entrants since 1996.
In Germany, retirement plans provide pensions and death and
benefit supplementary pension plans, above which they are
converted into defined contribution plans.
In the Netherlands, ceilings have been introduced for defined
been closed to new entrants since 2001.
defined benefit plans - which are based on employees’
average salaries over their final years of employment - have
In the United Kingdom, retirement plans provide pensions as
well as death and permanent disability benefits. These
plans are final salary plans. Since January 1, 2001, new
In the United States and Canada, the Group’s defined benefit
employees have been offered a defined contribution plan.
the actuarial method and is covered by a provision recorded
in the balance sheet.
benefits other than pensions, mainly concerning healthcare.
The Group’s obligation under these plans is determined using
In the United States and Spain, retired employees receive
long-service awards in France, jubilee awards in Germany,
deferred compensation, provisions for social security benefits
in the United States, and termination benefits in different
statement.
pension obligations. Actuarial gains and losses relating to
these benefits are recognized immediately in income
countries. The related defined benefit obligation is generally
calculated on an actuarial basis using the same rules as for
Provisions for other long-term employee benefits cover all
other employee benefits. These benefits primarily include
defined benefit obligations and plan assets
Actuarial assumptions used to measure
4.3.2
Rate assumptions
4.3.2.1
conditions specific to each country or Group company.
future salary increases take into account the economic
Assumptions related to mortality, employee turnover and
observed bond yields at December 31, 2016.
Discount rates were set by zone or country, based on
were as follows:
The rate assumptions used in 2016 for the Group’s main plans
(in %)
France
Eurozone
United
Kingdom States
United
Discount rate
1.80%
1.80% 2.60% 4.10%
Salary increases
2.50%
1.40% to
2.40% 2.00%*
3.00%
Inflation rate
1.50%
1.40% to
1.55%
2.35% 2.50%
A cap applies to the reference salaries used to calculate benefit entitlements.
*