Indexation objective
Employees born in or after 1950 participate in the average pay scheme (2007 Pension Regulations). This means they are subject to an indexation scheme whereby Progress indexes the pensions accumulated on 1 January of each year in line with the rate of increase for wages under the Collective Labour Agreement (CLA) during the previous year. This wage indexation is unconditional until 1 January 2012 (inclusive), i.e. it does not depend on Progress' financial position, with the exception of the example cited below. For the subsequent period, Unilever must still agree to new conditions with the trade unions.

Solely pension entitlements accumulated from 2007 onward for salaries exceeding EUR 72,281 are subject to a different indexation rule. As before, this portion is subject to an annual increase based on the wage increase under the CLA; however, Progress' investment result for the past five years determines whether this can be met or whether indexation for this portion will be lower than the wage increase under the CLA.

If, in a given year, no indexation is applied for this portion, or indexation is lower than the wage increase under the CLA, this can be made up for within five years provided the investment results allow this.

Indexation for the past
The current indexation rules became applicable to employees on 1 January 2008. Below, you will see the indexations that we have applied since that date, and how this relates to our indexation objective (wage increase under the CLA for Unilever). We distinguish between 'regular' indexation and indexation of the surplus pension (i.e. pension entitlements accumulated from 2007 onward for the portion of the salary above approximately EUR 72,281).

Since 'regular' indexation until 1 January 2012 (inclusive) is unconditional, solely the indexation of the surplus pension can be lower than the objective - which is what occurred on 1 January 2009, on 1 January 2011 and on 1 January 2012. Progress can apply these missed indexations for the surplus pension; however, this is only possible if the investment returns for the past five years have been adequate.

1 January of  the year	Indexation applied    (regular)	Indexation applied   (surplus pension)	Projected indexation  (CLA increase)
2008	4,03%	4,03%	4,03%
2009	3,50%	-	3,50%
2010	-	-	-
2011	3,28%	-	3,28%
2012	1,75%	-	1,75%