UNITED KINGDOM Recommendations RECOMMENDATIONS Employee benefit policies can vary significantly Recommendations at a Glance from company to company based on corporate philosophy, competitive situation and sensitivity ‰ Defined Contribution Pension (DC): to cost, among other factors. While the o Consider increasing employer recommendations presented in this section will contributions discuss plan design changes needed to bring ABC UK’s employee benefits plan in line with ‰ Individual Pension (IP): local trends and customs, ultimately the o Carry out in depth market review decision to implement these changes will require internal review and discussion. ‰ Life/Accident: o Keep current provision to improve Defined Contribution Pension (DC) competitiveness ABC UK’s existing 5% employer contribution ‰ Disability (PHI): level is relatively competitive for most o Keep current provision to improve employees but lower than the norm at the competitiveness senior levels. To bring other features of this ‰ Medical (PMI): pension plan more in line with other UK o Keep current provision to improve companies, and thus make the plan more competitiveness attractive for other employees, ABC UK may wish to consider increasing its contributions. ‰ Vacation and Critical Illness / Personal Accident Insurance: Individual Pension (IP) o Carry out in depth market review ABC already offers this popular benefit, which ‰ Multinational Pooling is positive. In fact, it may be worthwhile to o Consider pooling the Life/Accident and Disability cover conduct a more detailed review of this benefit at a later time, including a competitive analysis of ‰ Broker Relationships: rates and investments. o Consider utilizing broker or consultant Life/Accident UK employees frequently consider life insurance an important and valuable benefit, with typical benefit levels ranging between 3x salary (for lower level employees) and 4x salary (for senior employees). This is a valuable benefit for ABC to maintain, as it will help improve its competitiveness in the market. Long Term Disability (PHI) Because social security provides modest disability benefits, the financial impact of long-term disability is felt most strongly among the most highly compensated employees. By continuing to offer this benefit to all employees ABC is again increasing their competitiveness. Medical (PMI) ABC UK’s current plan provides full “Core” PMI benefits to employees at all levels. For lower level employees this would be considered attractive, and is on par with norms for more senior ABC UK Ltd Page C - 12