Carphone Warehouse 2016 Annual Report Download - page 69

Dixons Carphone plc Annual Report and Accounts 2015/16
Corporate Governance
67
Policy on loss of office
Service contracts contain neither a liquidated damages nor
a change of control clause.
The Company shall have a right to make a payment in lieu of
notice in respect of basic salary, benefits, including car
allowance and pension contributions only for the director’s
contractual period of notice or, if termination is part way
through the notice period, the amount relating to any unexpired
notice to the date of termination. There is an obligation on
directors to mitigate any loss which they may suffer if the
Company terminates their service contract. The Committee will
take such mitigation obligation into account when determining
the amount and timing of any compensation payable to any
departing director.
A director shall also be entitled to a payment in respect of
accrued but untaken holiday and any statutory entitlements
on termination. No compensation is paid for dismissal, save
for statutory entitlements.
A director shall be entitled to receive a redundancy payment
in circumstances where in the judgement of the Committee
they satisfy the statutory tests governing redundancy
payments. Any redundancy payment shall be calculated by
reference to the redundancy payment policy in force for all
employees in the relevant country at the time of the
redundancy and may include modest outplacement costs.
If a director’s employment terminates prior to the relevant
annual bonus payment date, ordinarily no bonus is payable
for that financial year. The Committee shall retain discretion
to make a pro-rated bonus payment in circumstances where
it would be appropriate to do so having regard to the
contribution of the director during the financial year, the
circumstances of the departure and the best interests
of the Company.
Any entitlements under long term incentive schemes operated
by the Company shall be determined based on the rules of the
relevant scheme. The default position under the Dixons
Carphone Share Plan is that awards will lapse on the
termination of employment unless the Committee exercises the
discretion set out in the scheme rules. The Committee retains
the discretion to prevent awards from lapsing depending on
the circumstances of the departure and the best interests of
the Company. The default position of the Long Term Incentive
Plan is that awards will lapse on termination of employment,
except where certain good leaver circumstances exist (e.g.
death, ill-health, injury, disability, redundancy, transfer of an
undertaking outside of the Group or retirement or any other
circumstances at the Committee's discretion) whereby the
awards may vest on cessation, or the normal vesting date,
in both cases subject to performance and time pro-rating,
although the Committee can decide not to pro-rate an award
(or pro-rate to a lesser extent) if it regards it as appropriate
to do so in the particular circumstances.
The Committee shall be entitled to exercise its judgement with
regard to settlement of potential claims, including but not
limited to wrongful dismissal, unfair dismissal, breach of
contract and discrimination, where it is appropriate to do so in
the interests of the Company and its shareholders.
In the event that any payment is made in relation to termination
for an executive director, this will be fully disclosed in the
following Annual Remuneration Report.
A timely announcement with respect to the termination of any
director’s appointment will be made to the regulatory news
service and posted on the Company’s corporate website.
Service agreements
Service agreements for executive directors
Each of the executive directors’ service agreements
provides for:
•the reimbursement of expenses incurred by the executive
director in performance of their duties;
•25 days’ paid holiday each year for Sebastian James,
Humphrey Singer and Katie Bickerstaffe (full time
equivalent); 27 days for Andrew Harrison and Graham
Stapleton;
•sick pay; and
•notice periods whereby Sebastian James, Humphrey Singer
and Katie Bickerstaffe each have a notice period of 12
months from the Company and six months from the director.
Andrew Harrison has a notice period of 12 months and
Graham Stapleton six months from either party.
In situations where an executive director is dismissed, the
Committee reserves the right to make additional exit payments
where such payments are made in good faith, such as:
•in discharge of a legal obligation; and
•by way of settlement or compromise of any claim arising in
connection with the termination of the director’s office and
employment.
00_DC 2016 Annual Report.pdf 67 11/07/2016 18:34