Organizational Strategy - Sustainable Development - L'Oréal

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7 L’OréaL - GrI DaTa SHEETS 2011 LA2 RECRUITMENT The number of new recruits in 2011(*) was 6,746, breaking down as: • 4,967 recruited on permanent contracts, • 1,779 recruited on temporary contracts. (*) This indicator pertains to roughly 60% of the global area. NUMBER OF NEW RECRUITS AT L’ORÉAL SA: L’Oréal recruited 301 persons on permanent contracts, 346 on fixed-term contracts and 284 on work-study programmes (170 apprenticeship contracts and 114 vocational training contracts). To this are added 300 persons taken on occasionally during holiday periods or for a season. L’Oréal does not experience any difficulties with recruitment, either at executive level or for other staff categories. NUMBER OF DISMISSALS AT L’ORÉAL SA: In 2011, there were no economic redundancies. Out of a total workforce of 6,015, there were 47 dismissals for inherently personal reasons, including 2 for physical inaptitude. INFORMATION RELATING TO WORKFORCE REDUCTION AND JOB PROTECTION PLANS, REDEPLOYMENT AND REHIRING EFFORTS AND SUPPORTING MEASURES: at L’Oréal Sa, there were no workforce reduction plans in place during 2011. > For more details, see “recruitment” on page 182 of the 2011 reference Document. LA3 PROFIT SHARING AND INCENTIVE SCHEMES For many years now, it has been L’Oréal’s policy to allow staff to share in the company’s results, which in 2011, resulted in 204.3 million euros being redistributed. L’Oréal has set up a global incentive scheme linked to the economic results of the subsidiaries (WPS – Worldwide Profit Sharing Program), the aim of which is to increase staff’s sense of belonging and motivation. at corporate level, adherence to the scheme’s principles and rules is coordinated by the Social relations Department, with the involvement of the General Management and Human resources departments from the zones, together with the General Management of the group. The scheme’s implementation and management are carried out locally by the General Management of each subsidiary. In addition to profit-sharing and incentive schemes for staff, the group has for some years been issuing stock option plans within an international framework, in order to offer the chief contributors a stake in the future development of the group’s results and to enhance their sense of belonging. In 2009, L’Oréal expanded its policy by introducing a mechanism for the Conditional Grant of Shares to Employees (CGSE), in order to reach a wider group of potential beneficiaries by means of a long-term coordination tool with a greater motivating effect than stock options. In 2011, the group decided to further widen the scope of the CGSE. In total, nearly 3000 staff, in this case nearly 14% of managerial staff worldwide, benefit from at least one stock option or CGSE, in accordance with the terms explained on the corresponding pages of section 7 – Stock market / Social capital information. > For more details, see “Profit Sharing and Incentive Plans on page 183 of the 2011 reference Document. INCENTIVE SCHEMES The incentive scheme is a system for which provision is made in law but which remains optional in nature. It was introduced within the framework of a group agreement in France from 1988 and renewed in 2009. Its amount is proportional to the current profit before tax adjusted by exceptional elements and weighted by the salary/added value ratio. The incentive scheme is available immediately but it may be blocked for 5 years in the Company Savings Plan in order to benefit from tax exemption. Within the framework of the new regulation on profit-sharing (article 1 of law no. 2011-894 of 28 July 2011), L’Oréal has proposed the payment of an additional Incentive payment, in respect of the non-compulsory financial benefits” envisaged by the texts, in connection with the increase of the dividend per share paid in 2011 in respect of the 2010 results. L’Oréal chose to offer an additional Incentive because it constitutes the system most in line with the concept of “value-sharing”. a company-level agreement was thus concluded with L’Oréal’s Central Works Council on 6 October 2011. Coming on top of the incentive amount paid in 2011 of +6.5%, this additional incentive was paid on 31 December 2011. DEVELOPMENT OF THE GROSS INCENTIVE SCHEME PAYMENT AT L’ORÉAL SA FOR ALL THE COMPANIES CONCERNED: In thousands of euros 2007 (1) 2008 (1) (2) 2009 (1) (2) (1) (2) 2010 L’Oréal S.A. 51,766 55,236 57,358 58,809 (1) Paid in next financial year. (2) Sums paid after corporate social contribution. 4/16
7 L’OréaL - GrI DaTa SHEETS 2011 For a gross annual salary of: > For more details, see “Incentive Scheme at L’Oréal S.a.” on page 183 of the 2011 reference Document. PROFIT-SHARING Profit-sharing is a system compulsory in France, introduced in 1968 for all companies with over 50 employees and making a profit. The profitsharing agreement was renewed in June 2009. L’Oréal has made favorable changes to the legal formula: It amounts to a group agreement: all employees of the companies which are signatories to this agreement, whatever their activity sector and results, receive the same share of the profit, It plans to include, in the financial benefit, royalties derived from the concession of patents, inventions and technical processes developed in France, thus creating a direct link with the group’s international development, It includes measures enabling the limiting of the consequences of exceptional events on the determination of the profit. Profit-sharing is available immediately but may be blocked for 5 years in the Company Savings Plan or the Blocked Current account, or blocked until retirement in the Collective retirement Savings Plan in order to benefit from tax exemption. DEVELOPMENT OF GROSS SHARE OF PROFITS IN FRANCE FOR ALL OF THE COMPANIES CONCERNED: (1) Paid in next financial year. (2) amounts after corporate social contribution. The 2010 share of profits paid in 2011 was the equivalent of 0.7 months’ salary. > For more details, see “Profit-sharing at L’Oréal S.a.” on page 184 of the 2011 reference Document. THE COMPANY SAVINGS PLAN AND L’ORÉAL EQUITY FUNDS L’Oréal offers a diverse range of funds that give staff great freedom of choice, as it is possible: to invest the share of profit in a Blocked Current account remunerated by L’Oréal at the average rate of yield of bonds in private companies (TMOP) in accordance with article D. 3324-33 of the Labor Code, since 2004, to invest the share of profit in a Collective retirement Savings Plan (PErCO) and to benefit from a matching contribution of +50%, to invest the profit-share and Incentive plans in a Company Savings Plan (CSP) made up of seven joint investment funds presenting a wide range of options (monetary, bonds, French and international stocks and securities, etc.) and great flexibility of use. a fund made up of 100% L’Oréal shares and two compartments: one can earn interest and is matched at a level of +25%, while the other can receive share of profit and voluntary payments and is not matched. > For more details, see “The Company Savings Plan and L’Oréal S.a. Share Fund” on page 184 of the 2011 reference Document. In 2011, the employees of L’Oréal and its French subsidiaries invested the following net amount of CSG (general social contribution) and CrDS (social debt reimbursement contribution)and social security contributions in the “The L’Oréal Incentive Scheme” fund consisting of 100% L’Oréal shares: €45,412,299, to which was added the net amount of “2011 Profit-sharing” additional Incentive of €2,148,184. These payments were then boosted by respective matching contributions of €9,961,285 and €463,525 which, at the opening price of the L’Oréal share on the day of each of these contributions, namely €85.15 on 29 april 2011 for the “L’Oréal Incentive” and €80.53 on 30 December 2011 for the “additional Incentive”, represented the equivalent of 122,741 L’Oréal shares. as the total net amount of the Incentive distributed in 2011 was €104,850,644, nearly 285,000 shares were thus offered free of charge by L’Oréal to its employees in France during 2011 via this matching contribution method. COMPANY SAVINGS PLAN AND BLOCKED CURRENT ACCOUNT Liabilities for all of the companies concerned: The 2010 gross incentive payment came to: 5/16 Additional “Profit- Sharing Incentive for 2011” e25,000 e6,674 or 3,2 months e474 e7,148 or 3.4 months e35,000 e7,853 or 2,7 months e558 e8,411 or 2.9 months e45,000 e9,032 or 2, months e642 e9,674 or 2.6 months e65,000 e11,390 or 2,1 months e810 e12,200 or 2.3 months In thousands of euros 2007 (1) 2008 (1) (2) 2009 (1) (2) (1) (2) 2010 L’Oréal S.A. 19,489 21,612 19,802 19,527 In thousands of euros 2009 2010 2011 CSP + blocked current account + PERCO 650,968 716,189 720,185 Total
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Organizational Strategy - Sustainable Development - L'Oréal

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