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Case studies for three levels at group
For example, at the beginning of the year, the group’s attributable earnings (GAE) target for calculating
bonuses at the end of the year was set an illustrative R10 billion. For bonus purposes, a 90% minimum
achievement of R9 billion was required and a maximum of R12 billion applicable. Using the following
assumptions, the bonuses for the three employee levels: executive director, senior manager and
employee level 2 will be as follows:
Assumptions
Executive
Senior manager
employee
General staff
level 2
(bonus declared)
General staff
level 2
(bonus not declared)
Annual salary
R2 000 000
R1 000 000
R400 000
R400 000
Bonus elements
Company
1
100%
(50% weighting)
100%
(20% weighting)
Not applicable Not applicable
Team
2
75%
2a
(50% weighting)
100%
2b
(50% weighting)
100%
2b
(50% weighting)
100%
2b
(50% weighting)
Employee
3
Not applicable 150%
3a
(30% weighting)
133%
3b
(50% weighting)
133%
3b
(50% weighting)
On-target bonus
(%)
80%
20%
9%
4,5%
Maximum bonus
(%)
160%
30%
12%
6%
Calculation
formula
(100% x 50%)
plus
(75% x 50%)
plus
zero
equals 87,5%
(100% x 20%)
plus
(100% x 50%)
plus
(150% x 30%)
equals 115%
Zero
plus
(100% x 50%)
plus
(133% x 50%)
equals 66,5%
Zero
plus
(100% x 50%)
plus
(133% x 50%)
equals 66,5%
Final bonus (%)
4
87,5% x 80%
equals 70%
115% x 20%
equals 23%
66,5% x 9%
equals 6%
66,5% x 4,5%
equals 3%
Final bonus
payable
R1 400 000
R230 000
R24 000
R12 000
1
It is assumed that the company performance was achieved 100%.
2
It is assumed that the team performance was achieved as follows:
2a
75% for executive.
2b
100% for senior management and general staff level 2.
3
It is assumed that employee performance was as follows:
3a
150% for senior management.
3b
133% for general staff level 2.
4
On-target bonus is respectively:
– 80% for executive.
– 20% for senior management.
– 9% for general staff where a bonus is declared.
– 4,5% for general staff where a bonus is not declared.
Remuneration report
continued
88
MTN Group Limited
Integrated Report 2017