Title: Holiday, Vacation and PTO Policy Page 1 of 9 Scope: This policy applies to all Team Members in the U.S. other than Puerto Rico-based and Dover Union Team Members. Team Members regularly scheduled to work fewer than 40 hours per week, temporary and student Team Members and interns are ineligible for holiday pay, paid vacation or PTO, unless otherwise required by law. For Team Members whose primary worksite is in California, certain exceptions apply to the policies that appear below, as noted in a separate policy covering California Team Members (See the HR Handbook). Exceptions that apply in other states will be posted at worksites or addressed in policies specific to those states. FIXED HOLIDAY POLICY: Zimmer Biomet observes the following 8 fixed holidays per year as paid days off: New Year's Day Memorial Day Independence Day Labor Day Thanksgiving Day Day After Thanksgiving Christmas Eve Christmas Day Each year, a schedule will be published showing dates of the designated fixed holidays for the year. Scheduling of fixed holidays may vary by location and is subject to change on a year-toyear basis. If a fixed holiday falls on a weekend, Zimmer Biomet locations will usually designate the Friday before or the Monday after as the paid holiday, but may designate another day within the same calendar year. A Team Member with an unexcused absence on the workday immediately before or immediately after a fixed or designated floating holiday (see below) forfeits eligibility for holiday pay (whether or not the Team Member is allowed to use paid time off to cover the unexcused absence). Team Members who are on leave status immediately before and after the holiday(s), other than those taking Family and Medical Leave concurrent with paid time off, will not receive holiday pay but may be eligible for leave-related pay covering the holiday. Team Members who would not be normally scheduled to work on the day when the holiday falls will not receive holiday pay. Fixed Holiday Pay Calculation Holiday pay for non-exempt Team Members will be based on the Team Member s straight-time pay rate (as of the date of the holiday) multiplied by the number of hours the Team Member would otherwise have been regularly scheduled to work on that day. Paid time off for holidays will count as hours worked for the purposes of calculating overtime pay for non-exempt Team Members.
Title: Holiday, Vacation and PTO Policy Page 2 of 9 FLOATING HOLIDAY POLICY: In addition to these 8 fixed holidays, Zimmer Biomet provides 4 additional days each year as floating holidays. For each calendar year, local management may designate one or more of these floating holidays as Company holidays, dictated by business needs. The following guidelines apply to undesignated floating holidays: Undesignated floating holidays must be scheduled in advance, subject to prior approval of the Team Member's supervisor. Scheduling request determinations will take into account any minimum staffing requirements and the need to avoid business disruption. Undesignated floating holidays must be taken in increments of 1/2 of a day, except when used concurrently with Family and Medical Leave in accordance with Zimmer Biomet's FMLA policy, if otherwise required by applicable state law, or if a greater increment has been adopted for the business unit or work site. Team Members will not receive compensation for unused floating holidays upon termination of employment, unless otherwise required by applicable state law. Team Members may not carry over unused floating holidays from one calendar year to the next, unless otherwise required by applicable state law. A non-exempt Team Member who has exhausted all of his or her PTO may apply an undesignated floating holiday to an absence that would otherwise qualify as PTO to receive pay, but may receive points under the attendance policy for the unplanned absence. Pay for Work on Designated Holidays Eligible non-exempt Team Members who are required to work on company-designated fixed or floating holidays, based on business needs, will be paid for hours worked according to the applicable local Overtime or Overtime/Premium pay policy unless the Team Member receives an alternate day off within the calendar year, in which case pay would be at the regular rate.
Title: Holiday, Vacation and PTO Policy Page 3 of 9 New Hires and Floating Holidays Newly-hired Team Members become eligible for holiday pay on designated floating holidays immediately upon hire. Newly-hired Team Members will be granted undesignated floating holidays during the first calendar year of employment as follows: Calendar Quarter of Hire Number of Undesignated Floating Holidays for the Worksite 4 3 2 1 0 1 st Quarter 4 3 2 1 0 2 nd Quarter 3 2 1 1 0 3 rd Quarter 2 1 1 1 0 4 th Quarter 0 0 0 0 0 VACATION POLICY (SALARIED TEAM MEMBERS): Zimmer Biomet recognizes the importance of time off work in providing Team Members the opportunity for rest, recreation and personal activities, and grants annual paid vacation to its full-time salaried Team Members. Earning Vacation Vacation accrues based on a Team Member's length of service according to the following schedule: Years of service: Vacation days received: 1-4 10 days 5-9 15 days 10-14 17 days 15-24 20 days 25+ 25 days Team Members whose annual vacation accrual rate as of December 31, 2015 is greater rate than the above schedule based on years of service will continue to accrue at that higher vacation rate until the next level of service years is reached based on the schedule shown above. Vacation is earned at a rate of ten percent (10%) of the annual allotment per month for each full month worked during the current calendar year up through ten (10) months. A full vacation allotment will be earned by working ten (10) months of the calendar year.
Title: Holiday, Vacation and PTO Policy Page 4 of 9 Vacation is earned according to the schedule below: Vacation Accrual Schedule Number of Whole Months Worked During the Current Year Eligible Vacation Days/ Based on Years of Service 1 Mo. 2 3 4 5 6 7 8 9 Less than 5 years 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 9.0 10.0 5 years but less than 10 years 1.5 3.0 4.5 6.0 7.5 9.0 10.5 12.0 13.5 15.0 10 years but less than 15 years 2.0 3.5 5.0 7.0 8.5 10.0 12.0 13.5 15.0 17.0 15 years but less than 25 years 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0 20.0 25 and more years 2.5 5.0 7.5 10.0 12.5 15.0 17.5 20.0 22.5 25.0 10 * * Team Members who will, assuming continued employment, reach anniversary dates during the calendar year that entitle them to greater vacation accrual will accrue at that greater accrual rate for the entire calendar year. Vacation time accrues as of the last day of the month. No vacation is accrued for a partial month worked. In a calendar year, Team Members will accrue all eligible vacation after working 10 full months. Years of service are calculated from the most recent date of Company employment unless a break in Company service was two years or less, in which case the prior Company service will be added to service since the rehire date. If an individual was employed by a company acquired by Zimmer Biomet under a merger, acquisition, or integration and remained continuously employed with Zimmer Biomet since that time, years of service are calculated from the individual s hire date with the acquired business. New Hires Newly-hired full-time regular Team Members accrue vacation according to the schedule above during their first, partial calendar years of service. Taking Vacation Days Team Members may take vacation days at any time throughout the year, but these days must be scheduled in advance subject to approval by a supervisor taking into account business needs. With the exception of use concurrent with Family and Medical Leave Act (FMLA) leave, vacation days must be taken in increments of 1/2 of a day. "Borrowing" Vacation Time After three months of employment, Team Members may take vacation time that has not yet accrued for that calendar year, with supervisory approval. For example, an individual with three years of service earns one vacation day per completed month of service up to a maximum of 10 days per year. If that Team Member wishes to take a week's vacation in March, he or she could seek approval through the normal vacation scheduling process to borrow vacation days that he or she has not yet accrued.
Title: Holiday, Vacation and PTO Policy Page 5 of 9 Because taking vacation days in advance of earning the time is equivalent to receiving a pay advance, if a Team Member leaves Zimmer Biomet and has taken more vacation time than accrued, the unearned time will be adjusted from the Team Member's final paycheck or severance pay unless prohibited by applicable state law. No Vacation Carryover Unused earned vacation may not be carried over to the next year, except by Team Members working in California or in any other jurisdiction where applicable law requires otherwise. Absent legal restriction, unused vacation days at the end of the calendar year are forfeited. Any exceptions to this policy based on extraordinary circumstances require written approval obtained through the local Human Resources Director, by the Senior Vice President Global Human Resources, or the Senior Vice President Global Human Resource's delegate. Vacation Accrual During Leaves of Absence Vacation continues to accrue during FMLA leave, military leave, extended jury duty and continuous Short Term Disability. However, if an individual s leave or continuous Short Term Disability extends into the next calendar year, he/she will only carry forward accrued unused vacation to the extent required by state and/or federal law. Team Members who take unpaid personal leave do not accrue vacation during the period of the leave. Vacation Pay for Separating Team Members Team Members separating from employment with Zimmer Biomet for any reason are paid any earned and unused vacation time. Vacation Scheduling Team Members must request supervisory approval in advance to schedule vacation time and should do so at least two weeks prior to the date on which the vacation is to begin except where shorter notice is allowed according to established departmental practice. Supervisors are responsible for ensuring that approved vacation schedules do not result in business disruption. With the exception of use concurrent with FMLA leave, vacation must be taken in 1/2 day increments, except as otherwise required by applicable state/local law. (See the HR Handbook for exceptions to the scheduling and minimum increment requirements that apply in California.) Reserved, Extended and Banked Vacation In 1994, Bristol-Myers Squibb changed its vacation accrual method. As part of this transition, some Team Members who subsequently became Zimmer, and now Zimmer Biomet, Team Members received credit for the number of "reserved" days to which they would have otherwise been entitled under the prior schedule. Additionally, some former CenterPulse employees have "extended" vacation days carried over from the time of their transition from CenterPulse to Zimmer employment. Also, prior to 2011, Zimmer allowed employees with 20 or more years of service to bank some vacation time. Reserved, extended and banked vacation days held in balance will be paid upon separation from employment at the Team Member's December 31, 2010, wage rate. Reserved, extended and banked vacation days may not be taken as additional time off work during employment.
Title: Holiday, Vacation and PTO Policy Page 6 of 9 No Extension of Retirement or Separation Dates Reserved, extended, banked, PTO and accrued vacation may not be used to extend a Team Member's retirement, resignation, or other separation date. PAID TIME OFF (PTO) POLICY (HOURLY TEAM MEMBERS): Zimmer Biomet recognizes the importance of time off work in providing Team Members the opportunity for rest, recreation and personal activities, and also recognizes that the inability to work due to illness or injury may cause economic hardship. Guidelines for PTO time, which may be used as vacation or sick time or for other personal reasons, are as follows. Earning PTO PTO accrues based upon a Team Member's length of service according to the following schedule: Years of service: PTO days received: 1-4 15 days 5-9 20 days 10-14 22 days 15-24 25 days 25+ 30 days Team Members whose annual combined vacation and sick time accrual rate as of December 31, 2015 is greater rate than the above schedule based on years of service will continue to accrue at that higher PTO rate until the next level of service years is reached based on the schedule shown above. PTO Usage PTO may be taken at any time throughout the year, subject to scheduling requirements established by work location. PTO may be used as vacation; for the Team Member's own illness, injury or medical care or that of a family member; or for any other personal reason. Any accrued available PTO must be used to cover a waiting period for approved short-term disability (STD) benefits. Once PTO is exhausted, time off is unpaid and subject to Zimmer Biomet s attendance policy unless covered by a form of protected leave. PTO is earned at a rate of ten percent (10%) of the annual allotment per month for each full month worked during the current calendar year up through ten (10) months. A full PTO allotment will be earned by working 10 months of the calendar year.
Title: Holiday, Vacation and PTO Policy Page 7 of 9 PTO is earned according to the schedule below: PTO Accrual Schedule Number of Whole Months Worked During the Current Year Eligible PTO Days/ Based on Years of Service 1 Mo. 2 3 4 5 6 7 8 9 Less than 5 years 1.5 3.0 4.5 6.0 7.5 9.0 10.5 12.0 13.5 15.0 5 years but less than 10 years 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0 20.0 10 years but less than 15 years 2.0 4.5 6.5 9.0 11.0 13.0 15.5 17.5 20.0 22.0 15 years but less than 25 years 2.5 5.0 7.5 10.0 12.5 15.0 17.5 20.0 22.5 25.0 25 and more years 3.0 6.0 9.0 12.0 15.0 18.0 21.0 24.0 27.0 30.0 10 * * Team Members who will, assuming continued employment, reach anniversary dates during the calendar year that entitle them to greater PTO accrual will accrue at that greater accrual rate for the entire calendar year. PTO accrues as of the last day of the month. No PTO is accrued for a partial month worked. In a calendar year, Team Members will accrue all eligible PTO after working 10 full months. Years of service are calculated from the most recent date of Company employment unless a break in Company service was two years or less, in which case the prior Company service will be added to service since the rehire date. If an individual was employed by a company acquired by Zimmer Biomet under a merger, acquisition, or integration and remained continuously employed with Zimmer Biomet since that time, years of service are calculated from the individual s hire date with the acquired business. New Hires Newly-hired full-time regular Team Members accrue PTO according to the schedule above during their first, partial calendar years of service. Taking PTO Team Members may take PTO at any time throughout the year, but these days must be scheduled in advance subject to approval by a supervisor taking into account business needs. Facilities, operations or departments may adopt PTO scheduling practices that will apply within those business units. With the exception of use concurrent with Family and Medical Leave Act (FMLA) leave, and subject to specific worksite limitations or exceptions that may apply, PTO may and must be taken in increments of 2 hours. "Borrowing" PTO After three months of employment, Team Members may take PTO that has not yet accrued for that calendar year, with supervisory approval. For example, an individual with three years of service earns 1.5 PTO days per completed month of service up to a maximum of 15 days per year. If that Team Member wishes to take a week's vacation in February, he or she could seek approval through the normal PTO scheduling process to borrow PTO he or she has not yet accrued.
Title: Holiday, Vacation and PTO Policy Page 8 of 9 Because taking PTO in advance of earning the time is equivalent to receiving a pay advance, if a Team Member leaves Zimmer Biomet and has taken more PTO than accrued, the unearned time will be adjusted from the Team Member's final paycheck or severance pay unless prohibited by applicable state law. No PTO Carryover Unused PTO may not be carried over to the next year, except by Team Members working in California or in any other jurisdiction where applicable law requires otherwise. Absent any applicable legal restriction, any unused PTO at the end of the calendar year is forfeited. Any exceptions to this policy based on extraordinary circumstances require written approval obtained through the local Human Resources Director by the Senior Vice President Global Human Resources or the Senior Vice President Global Human Resource's delegate. PTO Accrual During Leaves of Absence PTO continues to accrue during FMLA leave, military leave, extended jury duty and continuous Short Term Disability. However, if an individual s leave or continuous Short Term Disability extends into the next calendar year, he/she will only carry forward accrued unused PTO to the extent required by state and/or federal law. Team Members who take unpaid personal leave do not accrue PTO during the period of the leave. PTO Payout for Separating Team Members Team Members separating from employment with Zimmer Biomet for any reason are paid any earned and unused PTO. PTO Scheduling Team Members must request supervisory approval in advance for PTO use whenever reasonably possible. Facilities, operations or departments may adopt PTO scheduling practices including limits (within any applicable legal limits) on the amount of PTO available for use on an unscheduled basis. Team Members must use PTO in increments of 2 hours except for time taken concurrent with FMLA leave which may be taken in lesser increments. Time off taken in lesser increments that is not taken concurrently with FMLA leave will be unpaid, subject to applicable state or local law. (See the HR Handbook for exceptions to the scheduling and minimum increment requirements that apply in California.) Coordination of PTO and Workers' Compensation Benefits In cases of absence due to illness or injury for which workers compensation benefits are received, PTO may be used in order to maintain regular pay. If PTO is used, workers compensation pay benefits shall be assigned to Zimmer Biomet for whatever period of time the Team Member received PTO. The Team Member s available PTO shall be reinstated for any days for which workers compensation benefits were assigned, on a pro rata basis if the benefits assigned are less than the PTO pay provided. Notification Requirements Team Members who are unable to report to work on time for any reason must directly notify their supervisors by telephone each day of the absence before their scheduled shifts or normal
Title: Holiday, Vacation and PTO Policy Page 9 of 9 time of arrival (except during previously-approved periods of FMLA or other forms of leave). If the supervisor is not available, the Team Member should both leave a voice mail message continue to make an effort to speak with the supervisor directly. If a Team Member is unable to make the call personally, a family member should contact the supervisor. Individual locations or work areas may establish additional or different notification requirements. Failure to comply with notification requirements ordinarily results in consequences including disciplinary action under the applicable attendance policy absent proven emergency circumstances. (See the HR Handbook for an exception to this notification requirement that applies in California.) Team Members who miss consecutive workdays because of illness or injury that are not covered by approved FMLA leave are ordinarily required to provide medical certification from a health care provider to verify the need for time off work and the release to return to work. The number of consecutive days of absence for illness or injury that requires documentation in the form of a health care provider's note is determined by worksite. Team Members who need to miss work due to their own or a child's, spouse's, domestic partners, or parent's serious health condition should contact Zimmer Biomet's third-party administrator for FMLA leave for information about whether the circumstances qualify for such leave and to receive copies of the documentation required to qualify for such leave. SUMMARY MINIMUM LEAVE INCREMENTS Following is a summary of increments in which the various forms of paid time off may be taken, except when used concurrently with Family and Medical Leave in accordance with Zimmer Biomet's FMLA policy, if otherwise required by applicable state law, or if a greater increment has been adopted for the business unit or work site: Vacation Form of Paid Time Off Undesignated Floating Holidays PTO Increment for Usage 4 hours* 4 hours 2 hours *(See the HR Handbook for an exception to this minimum increment requirement that applies in California.) **Subject to limits that may apply by worksite. RIGHT TO TERMINATE OR AMEND POLICIES The Company reserves the right to amend, modify, suspend, change, or terminate these policies at any time and for any reason. These policies do not create any contractual rights or obligations, whether expressed or implied.