Note 10 Employees, personnel costs and remuneration to senior officers

Costs for remuneration to employees

Group, MSEK 2018 2017
Koncernen, Mkr 2018 2017
Salaries and remuneration etc. Löner och ersättningar m.m. 7,217 6,792
Pension costs, defined contribution plans Pensionskostnader, avgiftsbaserade planer 798 702
Social security Sociala avgifter 2,132 2,034
Total Summa 10,147 9,528

Average number of employees

No. of employees 2018 Of which were men 2018 percent No. of employees 2017 Of which were men 2017 percent
Antal anställda 2018 Varav män 2018 procent Antal anställda 2017 Varav män 2017 procent
Parent company Moderbolaget
Sweden Sverige 146 45 136 46
Subsidaries Dotterföretag
Sweden Sverige 12,219 88 12,022 88
Norway Norge 1,548 90 1,692 92
Finland Finland 744 83 724 84
Poland Polen 4 50 4 50
Total in subsidaries Totalt i dotterföretag 14,515 88 14,442 89
Group Koncernen 14,661 87 14,578 88

Gender distribution in boards and other senior officers

2018 Percentage of women 2017 Percentage of women
2018 Andel kvinnor procent 2017 Andel kvinnor procent
Parent company Moderbolaget
The Board of Directors Styrelsen 27 27
Other senior officers Övriga ledande befattningshavare 25 0
Group  Koncernen 
Boards 1) Styrelser 1) 23 11
Other senior officers 2) Övriga ledande befattningshavare 2) 22 15
1) Refers to the Board of Directors in the parent company and boards in subsidiaries.
2) Other senior officers in the Group refers to the other senior officers in the parent company along with business area management.

Salaries and other remuneration as well as pension costs for leading senior officers

Group 2018‚ MSEK Board of Directors and senior officers (15 persons) 1)
Koncernen 2018. Mkr Styrelse och ledande befattningshavare (15 personer) 1)
Salaries and other remuneration Löner och andra ersättningar 29
– of which variable remuneration etc. – varav rörlig ersättning o.dyl.
Pension costs Pensionskostnader 23
– of which pension costs for variable remuneration – varav pensionskostnader från rörlig ersättning 12
1) The group leading senior officers refers to executive management. During January-October 2018 the group consisted of six persons, three of which were in the parent company. From November 2018 the group consisted of seven persons, four of which were in the parent company.
Group 2017‚ MSEK Board of Directors and senior officers (14 persons) 1)
Koncernen 2017. Mkr Styrelse och ledande befattningshavare (14 personer) 1)
Salaries and other remuneration Löner och andra ersättningar 25
– of which variable remuneration etc. – varav rörlig ersättning o.dyl.
Pension costs Pensionskostnader 25
– of which pension costs for variable remuneration – varav pensionskostnader från rörlig ersättning 16
1) The group leading senior officers refers to executive management. During 2017 the group consisted of six persons, three of which were in the parent company. 

Salaries and other remuneration divided among leading senior officers and other employees as well as social security costs

Parent company 2018‚ MSEK Board of Directors and senior officers (12 persons) 1) Other employees Total
Moderbolaget 2018. Mkr Styrelse och ledande befattningshavare (12 personer) 1) Övriga anställda Totalt
Salaries and other remuneration Löner och andra ersättningar 20 102 122
– of which variable remuneration etc. – varav rörlig ersättning o.dyl. 2 2
Social security costs Sociala kostnader 24 69 93
– of which pension costs – varav pensionskostnader 7 22 29
– of which pension costs for variable remuneration – varav pensionskostnader från rörlig ersättning 8 4 12
1) The group leading senior officers refers to executive management. During January-October 2018 the group consisted of six persons, three of which were in the parent company. From November 2018 the group consisted of seven persons, four of which were in the parent company.
Parent company 2017‚ MSEK Board of Directors and senior officers (11 persons) 1) Other employees Total
Moderbolaget 2017. Mkr Styrelse och ledande befattningshavare (11 personer) 1) Övriga anställda Totalt
Salaries and other remuneration Löner och andra ersättningar 17 93 110
– of which variable remuneration etc. – varav rörlig ersättning o.dyl. 2 2
Social security costs Sociala kostnader 26 63 89
– of which pension costs – varav pensionskostnader 6 19 25
– of which pension costs for variable remuneration – varav pensionskostnader från rörlig ersättning 10 3 13
1) The group leading senior officers refers to executive management. During 2017 the group consisted of six persons, three of which were in the parent company.

Salaries and other remuneration for leading senior officers in 2018

Thousands, SEK Basic salary/Board remuneration Variable remuneration LTI-program 1) Other
benefits/
remunerations
Pension costs Total
Kkr Grundlön/ styrelse-arvode Rörlig ersättning LTI-program 1) Övriga
förmåner/
ersättningar
Pensions-kostnad Summa
Chairman of the Board, Göran Grosskopf Styrelsens ordförande, Göran Grosskopf 980 980
Vice Chairman of the Board, Mats Paulsson Styrelsens vice ordförande, Mats Paulsson 460 460
Other members of the Board Övrig styrelse
Karl-Axel Granlund Karl-Axel Granlund 520 520
Lars Sköld Lars Sköld 520 520
Fredrik Paulsson Fredrik Paulsson 460 460
Kerstin Lindell Kerstin Lindell 460 460
Liselott Kilaas Liselott Kilaas 460 460
Malin Persson Malin Persson 400 400
Board of Directors fees, remuneration from the parent company Styrelsearvode, ersättning från moderbolaget 4,260 4,260
CEO, Jesper Göransson Verkställande direktör, Jesper Göransson 7,200 2,477 1,389 563 3,668 15,297
Other senior officers, remuneration from the parent company Andra ledande befattningshavare, ersättning från moderbolaget 7,500 2,519 1,389 729 3,604 15,741
Other senior officers, remuneration from subsidiaries Andra ledande befattningshavare, ersättning från dotterföretag 8,412 2,893 1,625 641 3,395 16,966
Total Summa 27,372 7,889 4,403 1,933 10,667 52,264
Remuneration from the parent company Ersättning från moderbolaget 18,960 4,996 2,778 1,292 7,272 35,298
Remuneration from subsidiaries Ersättning från dotterföretag 8,412 2,893 1,625 641 3,395 16,966

Salaries and other remuneration for leading senior officers in 2017

Thousands, SEK Basic salary/Board remuneration Variable remuneration LTI-program 1) Other
benefits/
remunerations
Pension costs Total
Kkr Grundlön/ styrelse-arvode Rörlig ersättning LTI-program 1) Övriga
förmåner/
ersättningar
Pensions-kostnad Summa
Chairman of the Board, Göran Grosskopf Styrelsens ordförande, Göran Grosskopf 720 720
Vice Chairman of the Board, Mats Paulsson Styrelsens vice ordförande, Mats Paulsson 330 330
Other members of the Board Övrig styrelse
Karl-Axel Granlund Karl-Axel Granlund 360 360
Lars Sköld Lars Sköld 420 420
Fredrik Paulsson Fredrik Paulsson 330 330
Kerstin Lindell Kerstin Lindell 360 360
Nina Udnes Tronstad Nina Udnes Tronstad 300 300
Malin Persson Malin Persson 300 300
Board of Directors fees, remuneration from the parent company Styrelsearvode, ersättning från moderbolaget 3,120 3,120
CEO, Jesper Göransson Verkställande direktör, Jesper Göransson 6,600 3,270 1,806 516 3,250 15,442
Other senior officers, remuneration from the parent company Andra ledande befattningshavare, ersättning från moderbolaget 6,600 3,270 1,754 651 3,153 15,428
Other senior officers, remuneration from subsidiaries Andra ledande befattningshavare, ersättning från dotterföretag 7,740 3,835 2,008 587 3,135 17,305
Total Summa 24,060 10,375 5,568 1,754 9,538 51,295
Remuneration from the parent company Ersättning från moderbolaget 16,320 6,540 3,560 1,167 6,403 33,990
Remuneration from subsidiaries Ersättning från dotterföretag 7,740 3,835 2,008 587 3,135 17,305
1) For more information see Long-term incentive program (LTI program).

Comments on the tables

From time to time the CEO and other senior officers may be offered variable remuneration. Other benefits refer primarily to company cars and vacation pay.

Pension costs refer to costs charged to the year. See note 30 for additional information about pensions. In 2018 the group senior officers consisted of seven persons (six), of which four officers (three) were in the parent company. Until October 2018 the group senior officers consisted of six persons, of which three officers were in the parent company.

The Board of Directors

The 2018 AGM decided on a total remuneration to members of the Board of SEK 4,260 thousand (3,120), of which SEK 3,600 thousand (2,700) refers to Board work and SEK 660 thousand (420) refers to committee work. Compensation to the Chairman of the Board was SEK 800 thousand (600) and SEK 2,800 thousand (2,100) was divided among the other Board members. Compensation for work on the Remuneration Committee was SEK 180 thousand (90), SEK 180 thousand (90) for work on the Finance Committee and SEK 300 thousand (240) for work on the Audit Committee.

Remuneration is not paid to members of the Board who are permanent employees of the Group. There are no agreements for future pension/leaving remuneration or other benefits either for the Chairman of the Board of Directors or for other members of the Board.

Principles for remuneration to senior officers

The group senior officers is comprised of seven senior officers who are members of executive management. Until 1 November 2018 the group was comprised of six senior officers. The principles for remuneration to senior officers were adopted by the 2018 AGM.

Remuneration to the CEO and other senior officers consists of a fixed salary, any variable remuneration, extra health insurance and those benefits otherwise enjoyed by other Peab employees as well as pension. All pension obligations are defined contribution pensions. The total remuneration paid to each senior officer is based on market terms and the responsibilities and qualifications of the senior officer.

From time to time, senior officers may be offered variable remuneration. Such variable remuneration may not exceed 60 percent of their regular salary and is primarily based on the Peab Group’s profitability and, from time to time, essential Group goals. Variable remuneration is decided for each financial year. Variable remuneration for the financial year 2018 was maximized at SEK 4,320 thousand (3,960) for the CEO and a total of SEK 9,442 thousand (8,604) for the other senior officers.

Variable remuneration is settled the year after being earned and may either be paid out as salary or placed as pension in financial instruments connected to the Peab share. If it is paid out as a one-off defined pension contribution adjustments are made so as to neutralize the total cost for Peab.

From time to time, senior officers may be offered to participate in a LTI program. For senior officers and the CEO the upper limit (including social security) is 40 percent of their fixed annual salary. The result of the LTI program is placed in a pension savings in a financial instrument connected to the Peab share. Provisions for the LTI program for 2018 were maximized at SEK 2,880 thousand (including social security) for the CEO and a total of SEK 6,245 thousand (including social security) for the other senior officers.

The period of notice from Peab is, at the most, 24 months and the period of notice from Senior officers is, at the most, 6 months. If severance pay is paid the total remuneration for salary during the period of notice and severance pay may not exceed 24 months wages.

The CEO

The CEO of Peab AB, Jesper Göransson, has in 2018 received a salary and other remuneration, including benefits, totaling SEK 7,763 thousand (7,116). In addition, he has received variable remuneration for 2018 of SEK 2,477 thousand (3,270) and a provision for the LTI program of SEK 1,389 thousand (1,806) has been made, which was placed in a pension savings in a financial instrument connected to the Peab share. Pension contributions for the year were SEK 3,668 thousand (3,250).

The CEO has the right to retire from the age of 62. Annual pension contributions of 47 percent of basic salary are paid to meet this pledge. These are defined contribution pensions.

Notice on the part of Peab is twelve months with a reduction for any salary from a new employer combined with a severance pay of twelve months salary. Notice on the part of the CEO is six months combined with severance pay consisting of six months salary.

Other senior officers

The term other senior officers refers to the six other persons (until 31 October five persons) in addition to the CEO that make up Peab’s executive management. Salary and other remuneration including benefits for other senior officers amounted to SEK 17,282 thousand (15,578). In addition, variable remuneration for 2018 amounted to SEK 5,412 thousand (7,105) and provisions for the LTI program amounted to SEK 3,014 thousand (3,762), which will be placed in pension savings in a financial instrument connected to the Peab share. Pension contributions paid for other senior officers amounted to SEK 6,999 thousand (6,288) during the year.

The pension policy for senior officers means that pension contributions are based on a contribution ladder within, alternatively, ITP or defined contributions entailing that the total contribution amounts to 35-47 percent of fixed salaries. Certain senior officers have an agreement with Peab that their employment ends the month they turn 62 years old. The other senior officers have an agreement that their employment ends the month they turn 65 years old.

Notice on the part of Peab is twelve months with a reduction for any salary from a new employer combined with severance pay consisting of six-twelve months salary. Notice on the part of the other senior officers is six months combined with severance pay consisting of six months salary.

Long-term incentive program (LTI program)

From time to time, senior officers may be offered to participate in a LTI program. A LTI program was launched for 2015 – 2017 with annual provisions based on meeting the operating margin goal for the Group. The provisions’ size was related to the total dividends disbursed to shareholders for the year. The program was open to approximately 500 of the Group’s key employees. In order for an employee to receive their share of the result of the LTI program the employee had to have been working consistently for Peab from 2015 to 31 December 2017. In 2017 the cost of the LTI program amounted to SEK 83 million including social security.

A new LTI program was launched for 2018-2020 and will be annually reconciled with operating margin goals for the Group. The program is open to approximately 500 of the Group’s key employees. In order for an employee to receive their share of the result of the LTI program the employee has to still be working for Peab on 31 December 2020. For senior officers and the CEO the upper limit (including social security) is 40 percent of their fixed annual salary. For other positions the upper limit (including social security) is 15-35 percent of their fixed annual salary, depending on their position. The result of the LTI program will be placed in a pension savings connected to the Peab share. In 2018 the cost of the LTI program amounted to SEK 94 million including social security.

Profit-sharing foundation

In 2007, Peab founded a profit-sharing foundation. The object of the profit-sharing foundation is to create greater participation through employee co-ownership and to better employees’ financial situation after retirement. Individual annual shares in profits is related to the employee’s profit-sharing entitling work hours. Upon retirement employees can withdraw their share in the foundation. Under the foundation’s investment policy, its assets must be mainly invested in shares in Peab. In 2018 Peab allocated SEK 80 million. This amount less payroll tax will be paid into the foundation in 2019. In 2017 Peab allocated SEK 73 million including payroll tax.

Senior officers and other employees with other variable remuneration are not entitled to benefits from the profit-sharing foundation.