1.3 Personnel expenses

CHF million	Financial year ended 30.06.2022	%	Financial year ended 30.06.2021	%
Personnel expenses	1,093.9	100.0	1,022.3	100.0
Salaries and wages	877.6	80.3	824.8	80.6
Social security expenses	175.5	16.0	162.1	15.9
Share-based payments	7.0	0.6	8.3	0.8
Pension cost (see note 2.5)	27.0	2.5	23.3	2.3
Employment termination expenses	6.0	0.5	2.7	0.3
Other benefits	0.8	0.1	1.1	0.1
Employees at balance sheet date	15,795		14,998
Average number of full-time equivalent employees	15,495		14,989
Average number of employees per segment 1)	15,495	100.0	14,989	100.0
Region Americas	1,573	10.2	1,432	9.6
Region Asia Pacific	3,486	22.5	3,101	20.7
Region Europe & Africa	3,911	25.2	3,809	25.4
Operations	3,507	22.6	3,675	24.5
Key & Wall Solutions	1,918	12.4	2,001	13.3
Global Research and Development	524	3.4	466	3.1
Corporate	576	3.7	505	3.4
Average number of employees per geographical region	15,495	100.0	14,989	100.0
Switzerland	886	5.7	853	5.7
Germany	2,768	17.9	2,891	19.3
Rest of EMEA	3,842	24.8	3,606	24.1
Americas	3,680	23.7	3,607	24.1
Asia Pacific	4,319	27.9	4,032	26.8

1) dormakaba changed its operating model as of 1 January 2022. To enable a fair comparison with current-year data, all segment information disclosed were retrospectively adjusted to the new operating model by reclassification of full-time employees within the segment reporting.

Personnel expenses also contain Covid-19 contributions from governments for short-time work and other compensation. These grants are recorded in personnel costs with a cost-reducing effect to reflect the economic substance and did not have a material impact on the consolidated financial statements (2021/22 and 2020/21).

Share-based payments

The Nomination and Compensation Committee nominates individual Executive Committee (EC) members and other members of Senior Management for long-term incentive awards. The long-term incentive award in the 2021/22 financial year is granted in full in the form of performance share units of dormakaba subject to a three-year performance-based vesting period. The award is designed to reward participants for the future performance of the earnings per share (EPS) and the relative total shareholder return (TSR) of the company over the three-year performance period. Both performance conditions are equally weighted at 50%. The vesting level may range from 0% to a maximum of 200% of the original number of units granted (maximum two shares for each performance share unit originally granted).

In the 2020/21 financial year, one-third of the long-term incentive award was granted in the form of restricted shares of dormakaba subject to a three-year blocking period.

The restricted shares allocated to the members of the Board of Directors (BoD) are blocked for three years.

The fair value of the performance share units at the grant date comprises adjustments for lost dividends during the vesting periods and the TSR performance condition. The expenses for the performance share units are allocated on a straight-line basis over the vesting period.

The fair value of the restricted shares corresponds to the value of the closing price of the dormakaba Holding AG share on the SIX Swiss Exchange as at the business day prior to the date of the allocation.

Further information about the allocation of treasury shares is disclosed in the note on share capital and treasury shares (3.2), and further details about long-term incentive stock award plans are outlined in the Compensation Report.

Accounting principles

The fair value of the employee services received in exchange for shares is measured at the fair value of the shares as at the grant date and recognized as an expense with a corresponding entry in equity. Expenses for shares that vest immediately are recognized accordingly. Shares that are subject to future services are recognized over the vesting period.