Western Union 2013 Annual Report Download - page 69

51 | The Western Union Company – Proxy Statement
NOTICE OF 2014 ANNUAL MEETING OF STOCKHOLDERS AND PROXY STATEMENT
Compensation Discussion and Analysis PROXY STATEMENT
Severance and Change-in-Control Benefits. Western Union
has an executive severance policy for our executive officers.
The policy helps accomplish Western Union’s compensation
philosophy of attracting and retaining exemplary talent.
The committee believes it appropriate to provide executives
with the rewards and protections afforded by the Executive
Severance Policy. The policy reduces the need to negotiate
individual severance arrangements with departing
executives and protects our executives from termination
for circumstances not of their doing. The committee also
believes the policy promotes management independence
and helps retain, stabilize, and focus the executive officers in
the event of a change-in-control.
In the event of a change-in-control, the policy’s severance
benefits are payable only upon a “double trigger.” This
means that severance benefits are triggered only when an
eligible executive is involuntarily terminated (other than
for cause, death, or disability), or terminates his or her
own employment voluntarily for “good reason” (including
a material reduction in title or position, reduction in
base salary or bonus opportunity or an increase in the
executive’s commute to his or her current principal
working location of more than 50 miles without consent)
within 24 months after the date of a change-in-control.
In addition, the Executive Severance Policy prohibits excise
tax gross-up payments on change-in-control benefits for
those individuals who became executives of the Company
after April 2009. Please see the “Executive Compensation-
Potential Payments Upon Termination or Change-in-
Control” section of this Proxy Statement for further
information regarding the Executive Severance Policy and
the treatment of awards upon qualifying termination
events or a change-in-control.
Retirement Savings Plans. Western Union executives on
United States payroll are eligible for retirement benefits
through a qualified defined contribution 401(k) plan,
the Incentive Savings Plan, and a nonqualified defined
contribution plan, the Supplemental Incentive Savings
Plan (“SI SP.“) The SISP provides a vehicle for additional
deferred compensation with matching contributions from
the Company. We maintain the Incentive Savings Plan
and the SISP to encourage our employees to save some
percentage of their cash compensation for their eventual
retirement. Mr. Ersek participates in the qualified defined
contribution retirement plan made available to eligible
employees in Austria. The committee believes that these
types of savings plans are consistent with competitive pay
practices, and are an important element in attracting and
retaining talent in a competitive market. Please see the
2013 Nonqualified Deferred Compensation Table in the
“Executive Compensation” section of this Proxy Statement
for further information regarding Western Union’s
retirement savings plans.
Benefits and Perquisites. The Company’s global benefit
philosophy for employees, including executives, is to
provide a package of benefits consistent with local
practices and competitive within individual markets.
Each of our named executive officers participates in
the health and welfare benefit plans and fringe benefit
programs generally available to all other Western Union
employees in the individual market in which they are
located. In addition, in 2013 the Company provided the
benefits and perquisites as described in the 2013 Summary
Compensation Table in the “Executive Compensation”
section of this Proxy Statement.
The Company provided its other named executive officers
with competitive perquisites and other personal benefits
that are consistent with the Company’s philosophy of
attracting and retaining exemplary executive talent and,
in some cases, such as the annual physical examination,
the Company provides such personal benefits because
the Compensation Committee believes they are in the
interests of the Company and its stockholders. The
committee periodically reviews the levels of perquisites
and other personal benefits provided to named
executive officers.
Employment Agreements. The Company generally
executes an offer of employment before an executive
joins the Company. This offer describes the basic terms
of the executive’s employment, including his or her