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The Company and its domestic subsidiaries make annual contributions to the Tata Chemicals Employees’ Gratuity Trust and to the
Employees’ Group Gratuity-cum-Life Assurance Scheme of the Life Insurance Corporation of India, for funding the defined benefit plans
for qualifying employees. The scheme provides for lump sum payment to vested employees at retirement or death while in employment
or on termination of employment. Employees, upon completion of the vesting period, are entitled to a benefit equivalent to either half
month, three fourth month and full month salary last drawn for each completed year of service depending upon the completed years of
continuous service in case of retirement or death while in employment. In case of termination, the benefit is equivalent to fifteen days
salary last drawn for each completed year of service in line with the Payment of Gratuity Act, 1972. Vesting occurs upon completion of
five years of continuous service.
The Company also provides post retirement medical benefits to eligible employees under which employees at Mithapur who have
retired from service of the Company are entitled for free medical facility at the Company hospital during their lifetime. Other employees
are entitled to domiciliary treatment exceeding the entitled limits for the treatments covered under the Health Insurance Scheme upto
slabs defined in the scheme. The floater mediclaim policy also covers retired employees based on eligibility, for such benefit.
The Company provides pension, housing/house rent allowance and medical benefits to retired Managing and Executive Directors who
have completed ten years of continuous service in Tata Group and three years of continuous service as Managing Director/Executive
Director or five years of continuous service as Managing Director/Executive Director. The directors are entitled upto seventy five percent
of last drawn salary for life and on death 50% of the pension is payable to the spouse for the rest of his/her life.
Domestic subsidiaries also include a supplemental pay scheme (a life long pension), an unfunded scheme, covering certain Executives.
Family benefit scheme is applicable to all permanent employees in management, officers and workmen who have completed one year
of continuous service. Incase, of untimely death of the employee, the nominated beneficiary is entitled to an amount equal to the last
drawn salary (Basic Salary, DA and FDA) till the normal retirement date of the deceased employee.
The most recent actuarial valuations of plan assets and the present values of the defined benefit obligations were carried out at
31 March, 2018. The present value of the defined benefit obligations and the related current service cost and past service cost, were
measured using the Projected Unit Credit Method.
(B) In respect of overseas subsidiaries and joint ventures, the liabilities for employee benefits are determined and accounted as
per the regulations and principles followed in the respective countries.
(i) UK and Kenyan subsidiaries
The Homefield Pvt UK Limited - Group operates defined contribution schemes, under which costs of ` 12.66 crore (2017: ` 9.02
crore) are charged to the Consolidated Statement of Profit and Loss on the basis of contributions payable.
The Group also operates defined benefit schemes, the assets of which are held in separate trustee administered funds.
Defined benefit scheme - Tata Chemicals Europe Limited (‘TCEL’)
TCEL operates defined benefit pension arrangements in UK, which were available to substantially all employees but are now
closed to new members and closed for further accruals from 31 May, 2016. The assets of the scheme are held in separate trustee
administered funds.
As part of the 2014 valuation, a new payment schedule has been agreed between the trustees of the pension scheme and TCEL
whereby TCEL will make contributions towards the deficit in the fund from June 2016 to February 2041. TCEL will also continue to
make contributions towards the expenses of the fund and to cover cost of future accrual benefits for the remaining active members.
The present value of the defined benefit obligation, the related current service cost and past service cost were measured using the
projected unit method. The projected unit method is an accrued benefits valuation method in which the scheme liabilities make
allowance for projected earnings.
Defined benefit scheme - British Salt Limited (‘BSL’)
BSL operates defined benefit pension arrangements in UK. Eligible employees of the salt business were members of the British
Salt Retirement Income and Life Assurance Plan (‘RILA’) which was closed to future accrual and new members on 31 January, 2008.
RILA is funded by the payment of contributions to a defined benefit scheme and separately administered trust fund. The fund is
valued every three years using the projected unit method by an independent, professionally qualified actuary who has also set the
contribution rates for the year.
The most recent triennial valuation was performed as in June, 2016. The assumptions which had the most significant effect on the
results of the valuation were those relating to investment returns and price inflation.
(ii) USA subsidiaries - Tata Chemicals North America and its subsidiaries (‘TCNA’)
TCNA also sponsor defined contribution retirement savings plans. Participation in one of these plans is available to substantially
all represented and non-represented employees. TCNA matches employee contributions up to certain predefined limits for non-
represented employees based upon eligible compensation and the employee’s contribution rate.

240 Annual Report 2017-18