Compensation and Benefits

Compensation

Paying for performance is the guiding principle of the Novartis Pharmaceuticals Corporation compensation strategy, and our goal is to provide premium actual total pay (base salary, annual incentive and long-term incentive, if applicable) to employees who demonstrate sustained superior performance.

We use a market-based approach to compensation. Base salaries are reviewed annually against the external market to ensure competitiveness. Annual salary increases awarded by managers are differentiated based on performance and salary position against the market reference point for each job.

The Novartis Annual Incentive Plan (AIP) is designed to support our performance-oriented culture. Company performance is reflected in the business performance factor that drives the payout of the AIP. The performance modifiers vary, dependent on business unit or function, to closer correlate to the performance of that specific business or function. An additional individual performance factor further supports the differentiation for performance.

For all field-based employees on sales incentive plans, incentive payouts are tied directly to territory sales performance. When territory/product sales objectives are exceeded, the incentive payouts will exceed target as well.

Novartis offers the Stock Incentive Plan (SIP) as a form of long-term, equity-based incentive compensation to certain eligible participants responsible for the management, growth and success of the company. The SIP supports our performance-oriented culture and gives you the opportunity to build an ownership interest in Novartis based on your performance and potential contribution to the growth of our business. Two important features of this very unique and competitive plan are:

• Greater value: Tradable stock options, granted since 2004, provide recipients with an opportunity to profit from the time value of the option as well as the intrinsic value. Compared to traditional non-tradable options, these securities retain value in depressed markets.
• The "Select" Choice: Recipients choose to receive their awards in 100% tradable options, 100% restricted stock units, or a 50/50 combination of both. The choice is an individual decision based on your own risk tolerance and financial situation.

 

Benefits

The company offers an attractive benefits program that is competitive with top companies in the industry. For example, a flexible summer hours schedule, which allows eligible employees to get a head start on their weekend during summer months, clearly shows the company's determination to provide an environment that fully supports work/life issues. Among its recent accolades, the company has ranked among the top "100 Best Companies" by Working Mother magazine for the last nine consecutive years.

Novartis benefits program

Novartis recognizes that in order to attract and retain talented and dedicated individuals, we must offer a comprehensive and innovative benefits program. Some of the features of our benefits program that set us apart from other employers you may be considering are:

• Health & insurance coverage for domestic partners and their children
• Up to two weeks of vacation, plus personal/family days during your first year of employment
• An automatic 2% savings plan contribution and a dollar for dollar match— up to 4%—with immediate vesting
• Up to $1,000 per year in benefits toward child/elder care expenses through the Dependent Care Spending Account.

In addition to providing comprehensive insurance programs and a generous savings plan, Novartis is committed to helping its employees achieve personal success—with educational assistance and healthy lifestyle benefits. Moreover we maintain programs to help you balance your work and family obligations, that provide child and elder care subsidies, back-up care, and a wide array of other options to help you find, evaluate and pay for care. Novartis Pharmaceuticals Corporation is proud to be named one of the "100 Best Companies" by Working Mother magazine for the last nine consecutive years.

Overall health and well-being benefits

Health and well-being benefits include medical, dental, and vision insurance as well as a health care flexible spending account. These benefits, which include domestic partner coverage, become effective on the employee's date of hire and include an annual re-enrollment during which time changes may be made to benefit options. Options for medical insurance include PPO, Traditional Indemnity and two Consumer Driven Health Plans.

Work/life benefits

The benefits included within the area of Work/Life are intended to create a satisfying and productive work environment and can help employees meet their daily professional and personal responsibilities. These include:

• Paid time-off, including vacations, holidays, personal days, parental leave
• Tuition Reimbursement for eligible expenses at 100%
• Healthy Lifestyle Benefits Reimbursement toward health club membership, smoking cessation, or nutritional counseling programs
• Employee Assistance Program provides confidential counseling on such problems as every day stress, substance abuse, and financial issues
• Subsidized Child and Elder Care
• Dependent Care Spending Account with company match up to $1000 per year
• Adoption Reimbursement for adoption-related expenses up to $5,000 per adoption
• Child/Elder care resource and referral services
• Back-up child and elder care
• Matching Gift program through the Novartis US Foundation provides up to $5,000 per year to eligible institutions and organizations.

To help employees manage their valuable time, Novartis also provides convenient on-site services, including a fitness center, cafeteria, take-home meals, medical services, lactation rooms, federal credit union, ATM, company store, dry cleaning and film developing. In addition, most departments permit casual attire every day.

Financial protection benefits

• Disability Coverage
• Short-term Disability replaces all or a percentage of base pay for up to 26 weeks
• Long-term Disability after 26-week period provides monthly benefits equal to 50% of total pay with flexibility to increase level of coverage
• Life Insurance: Company paid and supplemental with flexibility to increase coverage at group rates.
• Survivor Income Plan provides a monthly benefit to surviving spouses and children.

Financial and retirement planning benefits

Investment Savings 401(k)

• Enrollment at any time
• Employee contributions up to 25% with
• Automatic 2% company contribution
• Dollar-for-dollar company match up to 4%,
• Immediate vesting on company match dollars
• Loan/withdrawal provision
• Novartis stock investment option
• Changes to investment elections/contributions daily
• Defined Contribution Retirement Program annual contribution after one year of service

Group/Legal Financial Planning Services is an optional program that gives you access to financial and legal advisors for issues including estate planning, budgeting, car lease/purchase, insurance and retirement planning, will preparation, and property transfer/closings.

Financial Education program includes access to on-site and e-Learning workshops. One-on-one counseling sessions for eligible associates with dependents needing assistance with the college savings/search process is also available.

Employee referral program

Nobody knows Novartis better than its employees. By identifying talented friends, relatives, and acquaintances who meet the qualifications for available positions, eligible Novartis employees may receive a $2000 referral bonus if a referred candidate is hired.