![Skip to main content [Access key C]](../../../../siteware/shim.gif){kind=small}
Policy on service contracts
The Chairman has a letter of appointment with six months' notice provision on either side. Kent Atkinson, Lord Blackwell, Jocelyn Proteau and Hugh Stevenson have letters of appointment with one month's notice provision on either side. Crawford Gillies and Baroness McDonagh have letters of appointment which do not contain any notice provision. The dates of the letters of appointment are:
| Gerry Grimstone | 6 June 2003 as Director and 28 February 2007 as Chairman |
| Kent Atkinson | 1 February 2005 |
| Lord Blackwell | 6 June 2003 |
| Crawford Gillies | 7 December 2006 |
| Baroness McDonagh | 27 February 2007 |
| Jocelyn Proteau | 27 June 2003 |
| Hugh Stevenson | 26 May 1999 as Director and 4 December 2003 as Senior Independent Director |
All non-executive Directors, including the Chairman, are appointed for an initial term of three years, which may be extended for a further three-year term, contingent on performance and any required re-election.
The letters of appointment do not contain any provisions for compensation payments to be made to the Chairman and non-executive Directors on termination.
All executive Directors have service contracts that provide for a 12 month notice period from the Company and six months if notice is given by the Director.
Dates of the service contracts are:
| Sandy Crombie | 31 March 2006 |
| David Nish | 31 October 2006 |
| Trevor Matthews | 9 April 2006 |
| Keith Skeoch | 3 April 2006 |
The contracts do not contain any liquidated damages clauses. They do contain payment in lieu of notice clauses that allow Standard Life to terminate a contract without giving due notice by making a payment equal to the salary, pension contributions and the value of other contractual benefits due to the relevant executive, for any unexpired notice period. This payment may be made in instalments and the Remuneration Committee's policy is to do this for unexpired notice periods over six months. These payments would stop if the executive found alternative employment of an equal or better remuneration.
John Hylands
An agreement had been reached with John Hylands that unless there were any suitable positions for him in the Group, he would retire as a Director on 31 March 2007 once key post-demutualisation activities had been materially completed. Under the terms of his contract agreed in 2004, he was entitled to receive a termination payment equal to one year's remuneration package, which consists of salary, annual bonus, long-term incentive plan awards, pension and other benefits. This was considered appropriate and necessary by the Remuneration Committee to ensure that John remained with Standard Life during the flotation process and the transition to a listed plc environment. On termination he was entitled to receive a payment of £705,542. Having elected to receive outplacement support to the value of £41,125, he received a reduced payment of £664,417.As an executive Director with service before 1982, John had been given a commitment that, by age 60, he would be able to accrue the level of pensionable service that would have applied at age 65. Since he had opted out of the defined benefit scheme from 6 April 2006, the Remuneration Committee decided that he would receive compensation on a cost neutral basis on his retirement for any loss of accrued service. Because of this, a payment of £24,755, was made to him following his retirement. Any payments under LTIP awards granted to him in 2005 and 2006 will be made in 2008 and 2009 at the normal vesting date for each award.
Alison Reed
Alison Reed resigned as a Director on 27 October 2006. During 2007 she made claims against the Company in respect of the termination of her employment and agreement was reached on a settlement of those claims in November 2007. Under this agreement, the Company made a payment to her of £1,135,000 and also paid £97,500 towards her legal fees. She will also receive a payment of £134,482 in April 2008 in lieu of short-term bonus for the first 4 months of 2007 and will be eligible to receive a payment in April 2010 in lieu of being granted a 2007 LTIP award which will be time pro-rated to reflect the first 4 months of 2007 as a proportion of the award's three-year performance period.As part of the settlement the Remuneration Committee exercised its discretion under the rules of the LTIP permitting Ms Reed to retain the long-term incentive plan awards granted to her in 2005 and 2006 (see the Directors' remuneration report).
