To innovate, grow and prosper, TI must recruit and retain the best talent the industry has to offer. We strive to compensate, recognize and develop our employees to keep them engaged and productive. We provide competitive benefits to help employees improve their health, reduce stress, balance their careers and personal lives, and increase their financial security.
Our total compensation philosophy of pay for performance rewards employees in a manner commensurate with their individual contribution to organizational and overall company success. It is designed to be competitive and to ensure that key talent, who will drive future growth, will remain with the company.
Our compensation approach is to target base pay and benefits at the industry norm, while providing variable cash bonuses based on company and individual performance. Compensation includes salary and bonuses, deferred compensation, equity programs and retirement programs.
We compensate employees with market-competitive salaries. We reward exceptional performance, regardless of age, gender, race, ethnicity or other personal characteristics, with higher pay. In addition to base salaries, we have a profit-sharing plan that pays cash bonuses based on our annual profitability.
Our performance-driven bonus structure pays out based on the company's absolute and relative performance. An employee's performance during the year dictates whether they will receive a reward, as well as the amount they will receive.
Paying our employees fairly is at the core of our commitment to diversity. We have formal checks and balances in our compensation system to exclude the possibility for discrimination in pay. Our system has multiple layers of oversight, with at least two levels of management plus reviews by Human Resources. Additionally, we conduct an annual, in-depth analysis to determine whether unwarranted disparities exist, as required by federal regulation.
Our deferred compensation plan offers eligible highly compensated employees the opportunity to defer a portion of their base pay, year-end bonus and profit sharing. Employees can select the deferral amount and the timing of payments within the rules of the plan.
We offer an employee stock purchase plan that allows employees to buy company stock at a 15 percent discount four times a year. Employees can pay for stock through payroll deductions and may sell the shares at any point in the future.
We also selectively grant equity awards to attract and retain key employees who are vital to the company's future success. The use of equity is tied to market practice and is intended to align with the interests of our shareholders.
Our retirement benefits cover eligible, active U.S. employees. In other countries where we operate, benefits vary.
We have a robust financial education program, including workshops and a wealth of resources and tools to help employees get on the right path and stay on track toward a financially healthy retirement.
For U.S. employees hired before December 1997, we have a defined benefit pension plan, of which the company pays full costs. Pension benefits are paid from a pension trust fund, which is not a company asset.
We offer all U.S. employees the ability to contribute to a 401(k) savings plan. We currently match 100 percent of employee contributions, up to 4 percent of annual eligible earnings, except for those employees actively accruing benefits in the pension plan. For those employees, we match 50 percent of their 401(k) contributions, up to 2 percent of annual eligible earnings.
TI's benefits include health, extended benefits coverage, income protection, long-term savings, financial advisement programs and wellness programs. Benefits apply to employees (Including part time employees who work 20 hours or more), military employees and retirees and include time off and income protection. These benefits may vary by region.
TI provides various benefit options to our employees, including health plans, dental care, vision care, life insurance, and short- and long-term disability.
Each year, TI evaluates its benefit offerings and makes necessary changes to ensure that TI continues to offer competitive benefits. There is an equal amount of time and resource spent making sure that the healthcare costs of the company are managed appropriately. We share the cost of some benefits with employees.
We make it easy for U.S. employees to enroll in and update their benefits information and to review their compensation packages through internal online sources. Through our internal website, benefits.ti.com, information about employee benefits is organized into family, employment and personal life events. It gives employees a quicker way to research a benefits issue or question.
To offset the cost of a variety of benefits, TI:
To minimize the financial hardship for U.S. employees called to active duty, TI provides an income supplement that makes up the difference between their military pay and TI's pay. We also continue to provide military employees with medical and dental coverage, 401(k) and stock contributions, and life insurance during their leave.
U.S. employees receive a set number of paid hours each month that can be used for leisure, vacation, personal time, short-term non-occupational illness or injury, and funeral or bereavement time off. Accrual is based on the number of full years of service completed before the first day of each month. Active employees also receive nine paid holidays, time off for jury duty and military leave.
TI's insurance options support U.S. employees in times of injury, illness or death. These benefits include:
For U.S. employees who qualify, our extended health benefits coverage provides access to medical and dental benefits after leaving the company. This coverage includes PPOs and HMOs, and dental PPO and HMO plans.
To attract and retain key talent, we evaluate both wages and benefits programs offered by host governments and other local companies where we operate internationally to ensure that we remain competitive.