HR Factbook 2018 - People. Facts. Developments.

About the HR Factbook 2018
Introducing: a typical Deutsche Telekom employee
Deutsche Telekom at a glance: the Group
Deutsche Telekom at a glance: Germany
Employees by country
Employees in Germany and worldwide
Employees by operating segment
Proportion of women in the Group
Age structure in the Group
Age structure in Germany
Employees in Germany by federal state
Employees by status group in Germany
Apprentices and students in Germany
Employees with disabilities in Germany
Integration of refugees into the labor market
Results from pulse survey and commitment index from employee survey
Satisfaction rate and commitment index, all managers
Employee satisfaction in Germany
Digital collaboration metrics
Personnel costs and personnel cost ratio
Total workforce costs
Personnel costs, proportion of total operating costs
Revenue and EBITDA per employee
Total workforce quota
Idea management in Germany
Natural attrition
Recruitment in Germany
Tools for socially responsible staff reduction in Germany
Vivento employees
Training, Group
Participants in international development programs
Participants in international development programs
Health rate in Germany

CONTENTS INTRODUCTION About the HR Factbook 2018 .................................................................................................................................... 3 Introducing: a typical Deutsche Telekom employee .................................................................................................. 4 Deutsche Telekom at a glance: the Group ................................................................................................................ 5 Deutsche Telekom at a glance: Germany .................................................................................................................. 6 EMPLOYEE AVAILABILITY AND DIVERSITY Employees by country .............................................................................................................................................. 7 Employees in Germany and worldwide ..................................................................................................................... 8 Employees by operating segment ............................................................................................................................. 9 Proportion of women in the Group ..........................................................................................................................10 Age structure in the Group .......................................................................................................................................11 Age structure in Germany ........................................................................................................................................12 Employees in Germany by federal state ...................................................................................................................13 Employees by status group in Germany ...................................................................................................................14 Apprentices and students in Germany .....................................................................................................................15 Employees with disabilities in Germany ...................................................................................................................16 Integration of refugees into the labor market ...........................................................................................................17 ORGANIZATIONAL CULTURE Results from pulse survey and commitment index from employee survey ...............................................................18 Satisfaction rate and commitment index, all managers ............................................................................................19 Employee satisfaction in Germany ...........................................................................................................................20 Digital collaboration metrics ....................................................................................................................................21 COSTS Personnel costs and personnel cost ratio ................................................................................................................22 Total workforce costs ...............................................................................................................................................23 Personnel costs, proportion of total operating costs ...............................................................................................24 PRODUCTIVITY Revenue and EBITDA per employee ........................................................................................................................25 Total workforce quota ...............................................................................................................................................26 Idea management in Germany .................................................................................................................................27 RECRUITMENT, MOBILITY AND ATTRITION Natural attrition ........................................................................................................................................................28 Recruitment in Germany ..........................................................................................................................................29 Tools for socially responsible staff reduction in Germany ........................................................................................30 Vivento employees ...................................................................................................................................................31 SKILLS AND PERFORMANCE POTENTIAL Training, Group ........................................................................................................................................................32 Participants in international development programs ................................................................................................33 LEADERSHIP Participants in international development programs ................................................................................................34 HEALTH AND SAFETY Health rate in Germany ............................................................................................................................................35 Work-related accidents in Germany ..........................................................................................................................36 HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 2

INTRODUCTION ABOUT THE HR FACTBOOK 2018 Dear readers, Digitalization is still the hot topic on everyone’s lips, both in the private sphere and at work. Our life is becoming more and more digital. We at Deutsche Telekom are a driving force in this transformation process and the growth engine of digitalization. In 2018, we strengthened our position as the leading European Telco, as reflected in various KPIs, such as market capitalization. As always, our success is driven by our employees, and the engine of digitalization relies on a powerful workforce. Human beings are still our ultimate success factor! Although we as a company drive the digitalization process with the help of our technology, we also need to master the associated challenges at a human level, particularly in connec- tion with our workforce. As humans are living longer, our working methods and processes are becoming ever more digital. The statistics on virtual communication and digital learning provide impressive evidence that we are on the right track. This HR Factbook on the 2018 financial year follows a tried-and-trusted format, with a com- pilation of indicators and information on all aspects of the Deutsche Telekom workforce. These KPIs reflect the diversity of our workforce, our organizational culture and our prod- uctivity. At the same time, however, we also highlight the skills and performance potential of our workforce, as well as our commitment to leadership, health and safety. This compre- hensive picture of our HR work is rounded off by an overview of HR costs, together with statistics on recruitment and attrition. As in previous years, the statistics reflect our grow- ing commitment to working with refugees. For an easy introduction to these topics, we have summarized the key findings of our re- port in three informative graphics, while deeper insights are given on the following pages. I hope you enjoy reading it. Best wishes, Michael Rubas Senior Vice President for Human Resources Planning & Operations Most of the data in the report refers to the 2018 calendar year ending December 31, 2018. Any exceptions are marked accordingly. All figures are based on more precise data. Since some values are rounded, totals may differ slightly. Some of the ratios are based on annual averages. The figures are often divided into the categories "Germany", "International" and "Group". In this case, “Germany” represents employees based in Germany (irrespective of segment). “International” refers to all employees based at loca- tions outside Germany, while “Group” refers to the entire workforce. Some of the data is broken down into operating segments, i.e. Germany, United States, Europe, Group Development (since January 1, 2017) and Systems Solutions. Group Headquarters & Group Services (GHS) comprises all Group units that are not directly assigned to one of the operating segments. As of January 1, 2017, the subsegment Technology & Innovation also belongs to GHS, which has also absorbed parts of the Systems Solutions segment. In some instances, we have used the male form (“he”), e.g. with reference to employees. This is to make the document easier to read and is used as a generic term, but explicitly refers to all genders. FTE stands for full time equivalents and is used in the Factbook as the unit of measurement for the size of the workforce. FTE therefore reflects the calculated number of full-time equivalents based on all full- and part-time staff. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 3

INTRODUCTION DEUTSCHE TELEKOM AT A GLANCE: THE GROUP Employees (FTE) Overall employee satisfaction + = 118 k 98 k 216 k 22 % 9 % 20 % 8 % 21 % 9 % Revenue per employee 249,000 € 436,000 € 69 % 72 % 70 % Germany International Group (total) Overall manager satisfaction 14 % 5 % 14 % 4 % 14 % 4 % Group revenue Total workforce quota 350,000 € 81 % 82 % 82 % Germany International Group (total) € 75.7 bn 36.1 % 15.9 % 22.6 % Personnel costs, adjusted Natural attrition Germany International Group (total) € 15.2 bn Average number of training days per employee 1.9 % 5.1 % 9.8 % 3.9 Women in middle and senior management 21.0 % 30.3 % 25.4 % Germany International Group (total) Germany International Group (total) HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 5

EMPLOYEE AVAILABILITY AND DIVERSITY Employees by country (in FTE) DEUTSCHE TELEKOM: AT HOME WORLDWIDE Germany Greece Hungary Romania Slovakia Croatia Poland Czech Republic Spain Netherlands Austria Macedonia Russia UK Switzerland Montenegro Albania France Belgium Italy Denmark 2018 98,092 12,407 12,385 6,980 8,367 4,964 4,830 3,611 2,409 1,563 2,933 1,083 1,766 423 529 522 337 170 124 24 61 United States (incl. T-Mobile US) Brazil South Africa Malaysia Mexico China Singapore Thailand United Arab Emirates Canada 2018 47,242 1,708 968 885 920 207 101 39 24 <6 In 2018, the number of employees in Germany was down 3.7 percent year-on-year, from 101,901 to 98,092. Growth was highest in Austria, where the number of employees increased from 2,001 to 2,933, primarily as a result of the merger between UPC and T-Mobile Austria in 2018. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 7

EMPLOYEE AVAILABILITY AND DIVERSITY Employees in Germany and worldwide (in thousands of FTEs as at Dec. 31) DEUTSCHE TELEKOM MORE GLOBAL THAN EVER 2000 2003 2007 2011 2015 2018 78.9 % Germany: International: 21.1 % 69.7 % Germany: International: 30.3 % 61.7 % Germany: International: 38.3 % 51.7 % Germany: International: 48.3 % 49.0 % Germany: International: 51.0 % 45.5 % Germany: International: 54.5 % 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Germany 179.2 178.3 177.8 173.3 171.0 168.0 160.0 148.9 131.7 127.5 123.2 121.6 118.8 116.6 114.7 110.4 104.7 101.9 98.1 Group (total) 227.0 257.0 256.0 248.5 244.6 243.7 248.8 241.4 227.7 259.9 246.8 235.1 229.7 228.6 227.8 225.2 218.3 217.3 215.7 International 47.8 78.7 78.1 75.2 73.7 75.7 88.8 92.5 96.0 132.4 123.6 113.6 110.8 112.0 113.1 114.9 113.7 115.4 117.6 The percentage of employees at international locations has risen substantially since the 1990s. Whereas 79 percent of the workforce worked in Germany in 2000, this figure has stabilized at below 50 percent since 2015, and stood at 45 percent in 2018. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 8

EMPLOYEE AVAILABILITY AND DIVERSITY Employees by operating segment (in FTE) SEGMENT DEVELOPMENT TREND UNBROKEN Germany U.S. Europe Systems Solutions Group Headquarters & Group Services Group Development Group (overall) 2014 68,754 39,683 53,499 46,244 19,631 2015* 67,927 44,229 48,920 37,850 23,548 2,768 2016* 66,410 44,820 46,808 37,472 20,258 2,572 2017* 64,798 45,888 47,421 37,924 19,351 1,967 2018 62,621 46,871 48,133 37,467 18,606 1,976 227,811 225,243 218,341 217,349 215,675 *Since January 1, 2017, our report has included the Group Development segment and, within the Group Headquarters & Group Services segment, the Technology and Innovation Board of Management department. Comparative figures for prior years have been adjusted retrospectively. By year end, the Group headcount had fallen by 0.8 percent year-on-year. Development within the individual segments showed a varied pattern. For example, the headcount in our Germany operating segment was down 3.4 percent, as the combined result of efficiency enhancement measures, fewer hirings in the operating units, and the take-up of socially responsible staff reduction options. As at December 31, 2018, the total headcount in our United States operating segment was up 2.1 percent year-on-year, primarily due to an increase in the customer support, back office and networks headcounts, although this was partially offset by a decrease in customer acquisitions. In our Europe operating segment, the year-end headcount was up 1.5 percent. The transfer of personnel from UPC Austria by our Austrian NatCo and the expansion of services in Croatia have mainly contributed to the increase. The year-end headcount in our Systems Solutions operating segment was down 1.2 percent net against 2017, primarily as a result of restructuring measures. Our Group Development operating segment reported a slight year-on-year increase in the headcount, while the Group Headquarters & Group Services segment reported a 3.9 percent decrease. The headcount reduction associated with ongoing staff restructuring measures at Vivento was partially offset by an increased headcount in the Technology and Innovation Board of Management department. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 9

EMPLOYEE AVAILABILITY AND DIVERSITY Proportion of women in the Group (in %) WOMEN’S QUOTA STILL A TOP PRIORITY FOR THE GROUP 35.3 35.3 35.7 35.5 38.0 38.8 40.0 39.8 25.8 25.4 25.4 21.8 14.3 14.3 12.5 12.5 26.0 26.0 27.0 26.0 In the workforce as a whole In middle / senior management1 In the Board of Management In the Supervisory Board, Germany, representing the In the Supervisory Board, international, representing the employer employer 2015 2016 2017 2018 1 Calculation of the women‘s quota in middle and upper management: female managers (headcount) in Management Groups 1-3 plus middle management per manager total at levels MG1-3 plus middle management x 100. The percentage of women in middle management was not reported in 2016. 35.5 percent of all employees at Deutsche Telekom are female. In 2018, we continued to work toward our target of 30 percent women in management positions, supported by the “Fair Share“ initiative. In Germany, the percentage of women in middle and upper management was down slightly from 21.1 percent to 21.0 percent in 2018. As before, this is attributable to Deutsche Telekom’s restructuring program in Germany. Group-wide, the level has remained constant at 25.4 percent. A number of changes to reporting in the national and international Supervisory Boards were implemented in 2018. To ensure high- quality statistics, in future, the number of women will be reported nationally in the German legal entities. This figure improved by one percentage point year-on-year in 2018, exceeding the statutory quota of 30 percent. In future, reporting will include the ratio of female and male officers on international supervisory boards (in the one-tier governance system, these are known as “non-executive directors”) of the Group’s fully consolidated telecom operators outside of Germany, with the exception of TMUS. Deutsche Telekom AG is one of only a handful of DAX corporations with an established track record of women in its Board of Management. The Business Leader team reporting to the Group’s Board of Management is currently comprised of nine women and 48 men. In 2016, Deutsche Telekom became a member of the “Chefsache” initiative, a network of managers from industry, academia, the public sector and the media, advocating equal opportunities for men and women. Through our cooperation with Global Digital Women and the launch of an “AI Hackathon” for women, we are continuing to raise Deutsche Telekom’s profile among women in STEM professions. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 10

EMPLOYEE AVAILABILITY AND DIVERSITY Age structure in the Group (in %) AVERAGE AGE UP SLIGHTLY ACROSS THE GROUP 30 30 30 30 29 27 27 27 27 27 25 24 24 24 23 10 10 10 9 9 11 10 10 9 8 16 – 25 26 – 35 36 – 45 46 – 55 56 – 651 2014; Ø Age (in years): 40.6 2017; Ø Age (in years): 41.0 1 Including > 65 years. 2015; Ø Age (in years): 40.6 20182; Ø Age (in years): 41.2 2016; Ø Age (in years): 40.7 2 Excluding Deutsche Telekom Capital Partners Management GmbH, Detecon International GmbH, Deutsche Telekom Clinical Solutions GmbH, Orbit GmbH, HÄVG GmbH, operational services GmbH & Co. KG, Toll4Europe, DT International Finance B.V., T-Systems Polska, DT North America, T-Systems Canada, T-Systems North America, IWS SK CES, and Detecon and ICSS companies The average employee age in Germany is rising steadily, but this is balanced out by the average age internationally (37.1 years). The average age across the Group as a whole is 41.2 years. In Germany, we place special emphasis on collaboration and the exchange of experiences between the generations. The soft skills and technical expertise of our employees over the age of 50 are valuable assets for Deutsche Telekom in the light of current demographic trends. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 11

EMPLOYEE AVAILABILITY AND DIVERSITY Age structure in Germany (in %) AVERAGE AGE IN GERMANY CLIMBS TO 46.3 YEARS DUE TO MINIMAL ATTRITION 47 46 46 45 44 22 19 17 16 15 15 15 15 15 14 20 18 16 15 13 5 5 5 5 5 16 – 25 26 – 35 36 – 45 46 – 55 56 – 651 2014; Ø Age (in years): 45.3 2017; Ø Age (in years): 46.1 1 Including > 65 years. 2015; Ø Age (in years): 45.5 20182; Ø Age (in years): 46.3 2016; Ø Age (in years): 45.8 2 Excluding Deutsche Telekom Capital Partners Management GmbH, Detecon International GmbH, Deutsche Telekom Clinical Solutions GmbH, Orbit GmbH, operational services GmbH & Co. KG, HÄVG GmbH, Toll4Europe, DT Deutsche Telekom International Finance B.V. Demographic shifts and low natural attrition explain why the proportion of employees over the age of 55 has risen from 13 to 20 percent in the past five years. In 2018, the average age of employees rose slightly to 46.3 years. One advantage is that Deutsche Telekom benefits from the vast know-how of its many experienced employees. We are responding to the challenges associated with an aging workforce with activities in three areas: 1. Skills development and knowledge: We encourage lifelong learning. For example, in 2018, we launched a new edition of the Magenta MOOC (massive open online course) on the subject of Design Thinking. Participation is free of charge and can be arranged flexibly. 2. Health: We offer programs to protect employees from illness and improve physical and mental fitness. For example, our employees have access to a broad range of sport facilities. Deutsche Telekom also offers its staff attractive membership rates in gyms and sport clubs. 3. Working environment: We offer our staff flexible working conditions that fit their needs at every stage of their lives. We also guarantee that employees working part-time can return to full-time work. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 12

EMPLOYEE AVAILABILITY AND DIVERSITY Employees in Germany by federal state (in FTE) ALWAYS CLOSE TO OUR CUSTOMERS SCHLESWIG-HOLSTEIN1.8 % MECKLENBURG WESTERN POMERANIA HAMBURG 3.8 % 1.0 % BRANDENBURG 1.3 % BERLIN 6.1 % SAXONY-ANHALT 1.7 % SAXONY 6.7 % BREMEN 1.6 % LOWER SAXONY 6.1 % NORTH RHINE-WESTPHALIA 31.2 % HESSE 11.1 % THURINGIA 1.4 % RHINELAND PALATINATE 3.3 % SAARLAND 1.1 % BADEN- WÜRTTEMBERG 9.6 % BAVARIA 12.2 % North Rhine-Westphalia1 Bavaria Hesse Baden-Württemberg Lower Saxony Berlin Saxony Hamburg Rhineland Palatinate Schleswig Holstein Saxony-Anhalt Bremen Brandenburg Thuringia Saarland Mecklenburg Western Pomerania 2018 29,971 11,688 10,688 9,180 5,814 5,868 6,430 3,635 3,195 1,777 1,606 1,578 1,266 1,309 1,074 1,004 1 Excluding Deutsche Telekom Capital Partners Management GmbH, Detecon International GmbH, Deutsche Telekom Clinical Solutions GmbH, Orbit GmbH, operational services GmbH & Co. KG, HÄVG GmbH North Rhine-Westphalia has the biggest number of Deutsche Telekom employees in Germany, a large proportion of whom work at the Group headquarters in Bonn. Bavaria and Hesse each have well over 10,000 Deutsche Telekom employees. Our nationwide presence is the logical consequence of a key element of our strategy: delighting customers and delivering the best service. Our nationwide presence enables us to stay close to our customers and precisely meet their individual needs. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 13

EMPLOYEE AVAILABILITY AND DIVERSITY Employees by status group in Germany (in FTE) FEWER EMPLOYEES WITH CIVIL SERVANT STATUS Active civil servants Civil servants on temporary leave from civil servant status1 Civil servants at affiliated companies1 Civil servants (total) Non-civil servants in Germany Total employees in Germany Proportion of non-civil servants in Germany (%) Proportion of civil servants in Germany (%) 2014 19,881 1,340 13,260 34,482 80,267 2015 18,483 1,220 12,292 31,995 78,360 2016 15,999 889 10,827 27,716 76,946 2017 15,482 731 10,486 26,699 75,202 114,749 110,354 104,662 101,901 69.95 30.05 71.01 28.99 73.52 26.48 73.80 26.20 2018 13,507 657 9,785 23,950 74,143 98,092 75.58 24.42 1 Civil servants whose status as such is currently suspended. They have temporarily switched to a non-civil servant contract. 2018 saw a further decrease in the number of civil servants. The reason for this is that Deutsche Telekom has not recruited any new civil servants since the company was privatized. Alongside natural age-related attrition, other contributing factors include ongoing transfers to government authorities together with the regulations on the dedicated retirement scheme for civil servants. This has led to a continual reduction in the proportion of civil servants in the workforce, from around 30 percent in 2012 to less than 25 percent in 2018. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 14

EMPLOYEE AVAILABILITY AND DIVERSITY Apprentices and students in Germany; total and proportion of women (in heads) ATTRACTIVE ENTRY OPTIONS FOR JUNIOR STAFF 9,140 8,798 7,785 6,852 6,094 3,559 3,399 2,972 2,497 2,142 total women total women total women 2014 2015 2016 total women 20171 total women 20181 1 Cooperative degree program students in 2017 and 2018, including cooperative Master’s degrees IT Commercial Students on coop On-campus students at HfTL University of Applied Sciences in Leipzig Examples of IT professions: IT systems electronics technician, IT systems business administrator, IT technician specializing in application development/systems integration Examples of commercial professions: office management administrator, dialog marketing administrator, retail sales assistant Examples of cooperative study programs: BA in Business Management, BEng in Communications and Media Technology, BSc in Business Information Systems In 2018, we offered 2,200 training positions to young people keen to benefit from our high-quality cooperative vocational training and degree programs. Deutsche Telekom responds to the various needs and achievement levels of school-leavers, offering young people from vastly different backgrounds the optimal scenario for integration in the company. We offer equal opportunities and flexible programs to meet the needs of specific target groups of young people, irrespective of gender, ethnicity, social background or physical disability. Our cooperative vocational training and degree programs also include entry-level internships, a program for refugees and part-time training courses. As an example, since 2011, Deutsche Telekom has cooperated with the Federal Employment Agency to provide part-time training for young single parents. 23 young people embarked on part-time vocational training or cooperative study programs in 2018. Telekom Ausbildung was quick to recognize the opportunities and potential of digitalization, and to promote this in its training and cooperative study programs. Digital elements and the digital perspective are firmly embedded in the Telekom Ausbildung didactic concept and are implemented systematically. Throughout their training, our paramount aim is to ensure that our apprentices and students understand the need to acquire and share know-how, connect with others, and reflect on their own actions, with the help of digital media. Telekom Ausbildung firmly believes this will inject flexibility and agility into the learning process. From day one, our trainees plan, document and reflect on their own learning process in an “e-portfolio”, helping them to plan and execute their next steps independently. Our trainees and students also have access to a learning platform, where they can share job-related content for future use. Specialist training courses, the majority of them in virtual format, provide students with basic knowledge relating to their training and study program. Exchange with colleagues across the Group is also supported by the in-house social network “You and Me“. In addition to this, we arrange for our apprentices and students to meet via our WebEx conferencing program and in virtual classrooms, thus linking knowledge transfer with an active exchange. This knowledge management system benefits our junior employees as soon as they embark on the practical phases of training in the Group and continues after they have completed their vocational training or degree course. Besides this, they pass on the key skills they have acquired to other employees in the Group. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 15

EMPLOYEE AVAILABILITY AND DIVERSITY Employees with disabilities in Germany (in %) INCLUSION: DEUTSCHE TELEKOM WELL ABOVE NATIONAL AVERAGE Germany 2014 7.0 2015 7.2 2016 7.5 2017 7.5 20181 7.6 1 Excluding Deutsche Telekom Capital Partners Management GmbH, Detecon International GmbH, Deutsche Telekom Clinical Solutions GmbH, Orbit GmbH, operational services GmbH & Co. KG, HÄVG GmbH For years, Deutsche Telekom has been campaigning for inclusion. With a broad portfolio of offers to support people with disabilities, Deutsche Telekom helps to create equal opportunities for them and get them involved in the community. Last year, in particular, we made a number of advancements in removing barriers for deaf and hearing-impaired employees. For example, we now offer simultaneous sign-language interpreting for most Board of Management presentations. Deutsche Telekom has exceeded the prescribed minimum rate of 5 percent disabled employees for a good many years, placing it well above the German average (of 4.1 percent according to the most recent survey). In 2018, the high proportion of disabled employees continued to increase slightly to 7.6 percent. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 16

EMPLOYEE AVAILABILITY AND DIVERSITY Integration of refugees into the labor market (in heads) COMMITTED TO HELPING REFUGEES: INTEGRATION INTO THE LABOR MARKET, INTEGRATION INTO SOCIETY Refugees at Deutsche Telekom 175 340 440 2016 2017 2018 Back in 2015, at the initiative of the Board of Management, Deutsche Telekom set up a task force to help refugees. The main focus was on providing rapid assistance to incoming refugees in the form of free WiFi at reception facilities, an internet platform with information about living and working in Germany, the provision of accommodation, and the assignment of staff to the Federal Office for Migration and Refugees, as well as supporting private voluntary work by its own employees. From providing initial assistance, in 2016, the task force evolved into its current project “Deutsche Telekom helps refugees”, managed by Group Corporate Responsibility. The focus now is on integration into the labor market. Alongside our aim of ensuring continuity, in 2018, we also focused on the long-term integration of refugees into the labour market. We provided 440 opportunities in the form of internships, entry-level qualifications, training, cooperative study programs and our “Internship PLUS” direct entry scheme. 250 of these were newly created positions. We successfully filled around 30 percent of longer-term vacancies with former interns from the target group. The Internship PLUS direct entry scheme has since been revamped and continued in those units with the greatest staffing requirements. A three- to six-month orientation phase is followed by a two-year employment contract. The advantage is that refugees have time to improve their language skills and to gradually find their feet in their new roles while working at the same time. In 2018, the scheme won the HR Excellence Award in the Corporate Social Responsibility category. The first interns will graduate in 2019. To assist their long-term integration into the work environment, in late 2018, the first interns were offered the opportunity to participate in the “Fit for the German labor market” training course by CPC Unternehmensmanagement AG. On successful completion, participants receive a certificate from the German Technical Inspectorate (TÜV). As part of a technology partnership, Deutsche Telekom provides ongoing support to the Handbook Germany internet platform, containing information about living, learning and working in Germany in German and 6 other languages, including English, Arabic and Persian. In 2018, it was awarded the Bronze German Digital Award in the Branded Content – Content Platforms / Digital Magazines category. It also won the German Online Communications Award in the Corporate Responsibility category. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 17

ORGANIZATIONAL CULTURE Results from the November 2018 pulse survey (in %) and commitment index from the May 20171 employee survey EMPLOYEES SATISFIED WITH DEUTSCHE TELEKOM – 9 8 Satisfaction + 7 6 Brand identity 16 12 Employer attractiveness 20 16 Changes 69 72 76 77 60 66 50 57 17 11 Strategy 56 71 14 14 Collaboration 15 14 16 13 19 15 Workload/ quality Work-life balance HR develop- ment 10 5 Learning 10 9 Digitalization 59 61 66 66 65 69 57 64 68 81 66 71 23 23 Recognition 53 55 7 6 6 4 3 3 Quality of leadership Guiding Principles Code of Conduct 81 85 76 81 87 88 Germany International „Neither agree nor disagree“ ratings are not included. Figures are taken from the latest pulse survey results. The most recent pulse survey was carried out in November. Commitment index scale 1 to 5 4.02 4.1 4.12 4.1 4.12 2014 2015 2016 2017 2018 1 Figures exclude T-Mobile US 2 Figures are taken from the latest pulse and employee survey results. The most recent pulse survey was carried out in November 2018, the last employee survey in spring 2017. The next employee survey is scheduled for 2019. The commitment index is the mean value of several scores in the employee survey. Deutsche Telekom promotes a productive exchange with its staff. New working models and state-of-the-art communication options, as well as regular employee surveys, help us to accomplish this. The main feedback tools which the Group uses to assess employee satisfaction are the employee survey, carried out every two years, and the biannual pulse survey, comprising questions on the 15 topics shown here. The set of questions is adjusted regularly to reflect changes in working environments and strategic requirements. Since 2016, the pulse survey has been extended to include topics such as modern learning formats, digitalization and measurement of leadership quality. In November 2018, more than 120,000 employees (72 percent) took part in the survey. Overall, the results are comparable with last year‘s figures. The scores for “Workload/Quality”, “Work-life- balance”, “HR Development”, “Learning” and “Digitalization” all showed a slight improvement. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 18

ORGANIZATIONAL CULTURE Satisfaction rate and commitment index, all managers MANAGER SATISFACTION AND COMMITMENT AT A HIGH LEVEL Satisfaction rate Germany International Group (overall) Commitment index (scale of 1 to 5) All employees All management staff Employees excl. managers 2014 86 % 82 % 84 % 4.01 4.41 3.91 2015 87 % 85 % 87 % 4.1 4.5 4.0 2016 88 % 86 % 87 % 4.11 4.51 4.01 2017 86 % 84 % 85 % 4.1 4.5 4.0 2018 81 % 82 % 82 % 4.11 4.51 4.01 Figures are taken from the latest pulse and employee survey results. The most recent pulse survey was carried out in November 2018, the last employee survey in spring 2017, with the next one being scheduled for May 2019. The commitment index is the mean of several values in the employee survey. 1 The figures for 2014, 2016 and 2018 are taken from the previous years’ employee surveys. Manager satisfaction had improved continuously up until 2016 and has decreased since then, but remains at a high level Group-wide. The commitment index for managers lies at a very good 4.5 on a scale of 1 to 5. Managers act in accordance with our binding leadership principles “Collaborate“, “Innovate“ and “Empower to perform“ as well as our Guiding Principles. Our performance and development process “Lead2Win” applies to all executives globally. Its principal components are the as- sessment of performance, potential, and readiness. Combined with continuous personal and multi-perspective feedback, the process is designed to encourage individual performance and create transparency for the next career steps. Executives set their own priorities and assessment intervals. We focus on sys- tematic, integrated leadership development at all management levels. To this end, we offer a selection of state-of-the-art ma- nagement tools. Offers are derived from the Group strategy and empower managers all over the world to face the challenges of the digital age. Managers can adapt them to their personal de- velopment status and integrate them into their day-to-day work whenever needed. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 19

ORGANIZATIONAL CULTURE Employee satisfaction in Germany (from pulse and employee surveys, in %) GERMANY: SATISFACTION LEVELS STILL HIGH 71 71 71 72 69 8 2014 8 2015 7 2016 7 2017 9 2018 Pulse and employee surveys 2014 – 2018: “How do you feel at Deutsche Telekom?“ Figures are taken from the latest pulse and employee survey results. The most recent pulse survey was carried out in November 2018. Positive (%) Negative (%) Since 2014, employee satisfaction in Germany has remained consistently high despite a slight dip in 2018 during periods of accelerated change. The structured follow-up process to the em- ployee survey draws up sets of measures to ensure improve- ments at all levels, right down to individual teams. This process analyzes the results from all 90 questions and makes them avai- lable to the teams. Responsibility for subsequent steps lies with managers, who use the results to develop and implement speci- fic measures in order, for example, to improve employee commit- ment and satisfaction. Managers derive valuable ideas for colla- boration on activities that will make their leadership and the company more successful. The pulse survey offers an annual review of the effectiveness of these measures. Managers can use the results to make any necessary adjustments and ensure the long-term effectiveness of any derived activities. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 20

ORGANIZATIONAL CULTURE Working in the Digital Age ACCEPTANCE OF ONLINE COMMUNICATIONS CONTINUES TO GROW WEBEX Minutes of online conferences (global) 2014 2015 2016 2017 2018 416,608,331 533,861,025 672,524,751 763,733,114 835,095,611 Jabber Jabber accounts You and Me User profiles 15,110 27,254 37,062 42,102 90,734 104,297 120,325 121,876 125,670 Virtual conferences allow our employees to work from (almost) anywhere in the world and, at the same time, cut travel costs and traveling time. Simple, fast, virtual communication is at the heart of effective international collaboration. In 2018, the volume of online conference minutes grew by a further 9.1 percent, to more than 835 million minutes. The number of registered users on the instant messaging service “Jabber” likewise rose to 42,102 in 2018, an increase of 13.6 percent. You and Me, our in-house social media and collaboration plat- form, grows ever more popular year by year. Despite an exten- sive data clean-up (to delete unused profiles), the number of user profiles rose to 125,670. In other words, more than half the entire workforce uses it to exchange ideas, experiences and views online. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 21

COSTS Personnel costs (in billions of €) and personnel cost ratio (in %) COLLECTIVE AGREEMENT IN GERMANY LEADS TO HIGHER PERSONNEL COST RATIO Personnel costs in the Group, non-adjusted (total) Of which Germany Special factors Personnel costs in the Group (adjusted for special factors) Group revenue Of which Germany1 Adjusted personnel cost ratio, Group (total, %) Adjusted personnel cost ratio, Germany (%) 2014 14.7 9.1 0.9 13.8 62.7 25.7 22.0 32.9 2015 15.8 9.4 1.2 14.6 69.2 25.7 21.2 33.0 2016 16.5 9.8 1.5 14.8 73.1 25.3 20.3 32.9 2017 15.5 8.5 0.6 14.9 74.9 25.2 19.9 32.1 2018 16.4 9.2 1.2 15.2 75.7 25.0 20.1 33.0 1 Since revenue between Germany/international is allocated from an HR perspective, it reflects the location of employees (FTEs), whereas the annual report allocates revenue to the country in which it is generated. The figures are calculated on the basis of values rounded to the nearest million. Group-wide, the personnel cost ratio in 2018 showed a slight in- crease year-on-year, with personnel costs rising proportionately faster than our Group revenue. This is mainly due to our collec- tive agreement with the ver.di trade union for Deutsche Telekom employees in Germany. By personnel costs we mean base personnel costs (salaries) plus fringe benefits. This figure is adjusted for special factors in conjunction with personnel restructuring measures (individual workforce reduction schemes). The personnel cost ratio represents personnel costs in relation to revenue. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 22

COSTS Total workforce costs, adjusted (in billions of €) US BUSINESS SUCCESS AND COLLECTIVE AGREEMENT IN GERMANY EXPLAIN SLIGHT INCREASE IN PERSONNEL COSTS TWC1 Of which Germany Of which international IWC2 (adjusted PC3) EWC4 leased and temporary staff EWC4 freelancers and consultants IWC2 (adjusted PC3) EWC4 leased and temporary staff EWC4 freelancers and consultants 2014 15.4 9.2 8.5 0.05 0.7 6.1 5.3 0.3 0.6 2015 16.5 9.2 8.5 0.05 0.7 7.2 6.1 0.4 0.7 2016 16.8 9.1 8.3 0.03 0.7 7.8 6.5 0.5 0.8 2017 16.9 8.9 8.1 0.04 0.8 7.9 6.8 0.2 0.8 2018 17.1 9.0 8.1 0.05 0.8 8.0 7.1 0.2 0.8 1 Total Workforce Costs: External Workforce Costs + Personnel Costs adjusted for special factors 2 Internal Workforce Costs 3 Personnel Costs 4 External Workforce Costs: costs of leased and temporary workers, freelancers and consultants Total workforce management (TWM) provides a holistic view of HR management at Deutsche Telekom. Alongside our internal workforce and internal workforce costs, TWM also includes ex- ternal staff working for Deutsche Telekom. Incorporating the costs of consultants, leased and temporary staff is important for qualitative and quantitative long-term personnel planning. As the personnel cost ratio does not include external workforce costs, the total workforce costs or Total Workforce Quota is the principal ratio used to manage personnel costs within the Group. The Group’s total workforce costs rose by around 200 million euros between 2017 and 2018, primarily due to success in our U.S. business and the associated growth in the work- force, coupled with the collective agreement in Germany. While internal workforce costs increased slightly, the costs of free- lancers, consultants, leased and temporary staff showed a slight decrease. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 23

Personnel costs (in millions of €), proportion of total operating costs (in %) EMPLOYEES CRUCIAL TO OUR SUCCESS Breakdown of personnel costs Payroll Social security contributions and company pension scheme Adjusted personnel costs, accumulated Personnel costs as proportion of total operating expenses Adjusted operating costs Personnel costs as proportion of total costs DT Group National International DT Group National International DT Group National International DT Group National International DT Group National International 2015 11,746 6,726 5,020 2,899 1,770 1,129 14,646 8,496 6,149 50,723 17,854 32,869 28.9 % 47.6 % 18.7 % 2016 11,900 6,639 5,262 2,924 1,679 1,245 14,824 8,318 6,507 52,718 17,484 35,234 28.1 % 47.6 % 18.5 % 2017 12,017 6,467 5,550 2,928 1,638 1,290 14,945 8,105 6,840 53,854 17,221 36,633 27.8 % 47.1 % 18.7 % COSTS 2018 12,390 6,502 5,889 2,913 1,650 1,263 15,216 8,146 7,070 53,782 16,873 36,909 28.3 % 48.3 % 19.2 % In 2018, Deutsche Telekom posted adjusted personnel costs to- taling 15.2 billion euros, 12.4 billion of which were for wages and salaries. In addition to this, we paid 2.9 billion euros into social security and company pension schemes. The company pension scheme enables our employees to top up their statutory pensions. Personnel expenditure accounted for 28.3 percent of Deutsche Telekom‘s adjusted total operating costs of 53.8 bill- ion euros. This is one of the biggest expenditure items but it is also the basis for our success. Our employees are key to the overall success of our company‘s business. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 24

Revenue and EBITDA per employee (per FTE, yearly average) USA STILL OUR BIGGEST GROWTH MARKET PRODUCTIVITY 439 346 245 436 350 249 424 331 235 385 306 227 329 275 222 Germany International Group Revenue, Germany (billions of €)2 Revenue, international (billions of €)2 Revenue, Group (billions of €) International revenue as a percentage of Group revenue2 Ø Average number of employees, Germany Ø Average number of employees, international Ø Average number of employees, Group (overall) 20141 20151 20161 20171 20181 2014 25.7 36.9 62.7 58.9 % 116,067 112,181 228,248 2015 25.7 43.5 69.2 62.9 % 113,277 113,055 226,332 2016 25.3 47.8 73.1 65.4 % 107,793 112,790 220,583 2017 25.2 49.7 74.9 66.4 % 103,174 113,280 216,454 2018 25.0 50.7 75.7 67.0 % 100,227 116,142 216,369 1 Revenue per FTE, thousands of € 2 Since revenue is allocated from an HR perspective when calculating ratios, it reflects employee location (FTE), whereas the annual report allocates revenue to the country in which it is generated. The figures are calculated on the basis of values rounded to the nearest million. 2016 2015 2017 2018 EBITDA per FTE (average) in euros, adjusted DT Group 87,959 97,105 102,700 107,795 In 2018, Deutsche Telekom generated Group revenue of 75.7 billion euros, a year-on-year increase of approximately 700 million euros (or around one percent). The international share of Group revenue rose by 0.7 percentage points to 67 percent. Revenue per employee also increased steadily in 2018 by around one percent to 350,000 euros. In Germany, revenue per employee was up 1.6 percent, but down 0.7 percent in our international business, primarily thanks to the US business. The headcount in our United Sta- tes operating segment increased by 2.1 percent, driven partly by new mobile customers from the successful “Un-carrier“ initi- atives launched by T-Mobile US. As a result, revenue at the United States segment increased by around 2.2 percent ye- ar-on-year, accounting for the largest share of Group revenue at 48.3 percent. The Group-wide growth in revenue, coupled with a slight decrease in headcount, accounts for the increase in productivity. In 2018, the average full-time employee at Deutsche Telekom generated an adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of 107,795 euros, up nearly five percent on 2017. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 25

Total workforce quota, adjusted (costs and revenue in billions of €) TOTAL WORKFORCE QUOTA UP SLIGHTLY PRODUCTIVITY Germany International Group (overall) 2014 2015 2016 2017 2018 PC1, adjusted EWC2 TWC3 Revenue4 TWQ5, adjusted PC1, adjusted EWC2 TWC3 Revenue4 TWQ5, adjusted PC1, adjusted EWC2 TWC3 Revenue4 8.5 0.8 9.2 25.7 35.9 % 5.3 0.8 6.1 36.9 16.6 % 13.8 1.6 15.4 62.7 8.5 0.7 9.2 25.7 35.9 % 6.1 1.1 7.2 43.5 16.6 % 14.6 1.8 16.5 69.2 8.3 0.8 9.1 25.3 35.9 % 6.5 1.3 7.8 47.8 16.2 % 14.8 2.0 16.8 73.1 8.1 0.8 8.9 25.2 35.4 % 6.8 1.1 7.9 49.7 15.9 % 14.9 1.9 16.9 74.9 8.1 0.9 9.0 25.0 36.1 % 7.1 1.0 8.0 50.7 15.9 % 15.2 1.8 17.1 75.7 TWQ5, adjusted 24.6 % 23.8 % 23.0 % 22.5 % 22.6 % 1 Personnel Costs 2 External Workforce Costs: costs of leased and temporary workers, freelancers and consultants 3 Total Workforce Costs: External Workforce Costs + Personnel Costs adjusted for special factors 4 Since revenue allocation to determine ratios is based on an HR perspective, it reflects employee location (FTE), whereas the annual report allocates revenue to the country in which it is generated. 5 Total Workforce Quota = TWC/revenue The Total Workforce Quota at Deutsche Telekom likewise increased slightly in 2018 due to the rise in personnel costs. The adjusted ratio for the Group as a whole was down 0.1 percentage points year-on-year. While total revenue was up one percent (0.7 billion euros) in 2018, Total Workforce Costs increased by around 1.2 percent year-on-year. The Total Workforce Quota describes the relationship between total personnel expenditure (internal and external) and revenue. In other words, if the ratio is up on the previous year, either Total Workforce Costs have increased, revenue has decreased, both these effects have occurred simultaneously, or changes in these two indicators were disproportionate to one another. This ratio is very important to us, as it expresses the productivity of our employees. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 26

PRODUCTIVITY genial@Telekom in Germany EMPLOYEE IDEAS SAVE 78 MILLION EUROS Ideas submitted Savings (in millions of €) 2014 13,231 106.6 2015 13,728 146.5 2016 10,125 168.5 2017 6,902 99.0 2018 5,123 78.0 Ideas Generation Management (IGM) develops concepts and measures designed to tap into our employees’ innovative potential for the benefit of the Group. All the ideas submitted are appraised, and the promising ones are quickly implemented. IGM helps to foster a climate of innovation, exerts a positive influence on the corporate culture, and helps protect jobs within the Group and keep the share price healthy. With 5,123 ideas submitted, the response was lower than last year, but the quality of individual ideas (benefits per idea and implementation rate) improved. 2018 saw a shift in favor of cooperation with other initiatives, and we are hopeful that this will help boost participation in Ideas Generation Management in 2019. Second place in the “German Ideas Management Prize 2018” by Zentrum Ideenmanagement in the “Best employee idea – administration and management” category was awarded to Manfred Heidl for his “DigiFirst” idea, which uses automation to rectify deficiencies in the ticket system and create a more productive and ergonomic working environment. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 27

RECRUITMENT, MOBILITY AND ATTRITION Natural attrition FURTHER SLIGHT RISE IN EMPLOYEE TURNOVER Germany International1 Group (overall)1 1 excluding T-Mobile US 2014 1.42 % 8.57 % 4.21 % 2015 1.28 % 9.25 % 4.39 % 2016 1.37 % 8.14 % 4.01 % 2017 1.70 % 9.22 % 4.68 % 2018 1.94 % 9.78 % 5.12 % At both international and national level, the attrition rate has ris- en compared with 2017. Internationally, around 6,700 contracts were terminated by the employer or employees, approximately 470 more than in 2017 (an increase of approximately 7.5 percent). In addition, 107 employees outside Germany retired upon reaching the statutory pension age or due to incapacity for work, 13 fewer than in 2017. In Germany, 1,320 employees quit their jobs in 2018. Around 660 employees left the company due to reaching retire- ment age or because of incapacity for work. The increase in contract terminations led to a rise in the attrition rate for the Group as a whole. Natural attrition means normal staff reduc- tions that occur without specific cutback measures, for example due to retirement, incapacity for work, contracts terminated by employees, or contracts terminated by the employer for con- duct-related or personal reasons. These are presented as a percentage of the total workforce (figure for end of the previous year). HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 28

RECRUITMENT, MOBILITY AND ATTRITION Recruitment in Germany (in thousands of FTE) RECRUITMENT GOES DIGITAL 2014 2015 2016 2017 2018 2.0 1.8 1.6 1.7 1.6 2.3 4.3 1.7 3.4 1.6 3.2 1.7 3.4 1.8 3.4 Internal junior staff from vocational training/cooperative study programs External recruitment In 2018, Deutsche Telekom hired almost 1,800 new employees from the external labor market in Germany. We also offered per- manent jobs to around 1,600 internal junior staff on completion of their vocational training or cooperative study programs. A total of 10,460 employees were recruited outside Germany. As Europe’s leading Telco, we need the finest minds: creative thinkers and technically-minded employees who will collaborate with us to help shape the digital transformation. We seek out the top talents in all countries, in line with the ongoing interna- tionalization of our Group. Our global “Employer Value Proposi- tion” highlights our defining features as employer. We offer applicants a global job search platform and interna- tional standards in our selection processes. We use a wide range of digital channels for our recruiting, including our “Global Online Challenge Platform”, which we use to reach students, graduates and IT professionals worldwide who enjoy mastering virtual business games. In 2018, we began testing the use of online games in our application process. For exam- ple, games were used in the assessment center for our Start up! trainee program to give an additional insight into the applicants’ personalities. At the end of 2018, we opened up our “CMD+O” open workspace in Munich and Cologne to IT experts, young professionals and students for a few weeks, offering them a space to implement their own projects, make valuable contacts, and broaden their horizons. Interested individuals were able to join workshops and attend presentations. Diversity is an integral part of our corporate culture and we are committed to attracting more women to our company. The women’s STEM Award, launched in 2013 with student magazine audimax and the “MINT-Zukunft-schaffen” (Creating a STEM future) initiative, promotes women in STEM subjects and profes- sions. We also support Femtec, a career training program for female STEM students with leadership potential, as well as “Global Digital Women”, an international network of digital industry influencers. We also exhibited at “Women&Work”, Europe’s leading trade fair for women and careers, enabling us to selectively approach potential candidates. Accolades In 2018, we once again received multiple awards for our recruiting activities. We successfully defended our second place in the overall ranking by market research institute Potentialpark, winning first-place rankings in the individual categories “Career website” and “Social media”. In 2018, we were also awarded the “trendence Employer Branding Award” in the “Best employer branding for students” category. Finally, the “Women&Work” fair voted us “most appealing employer”. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 29

RECRUITMENT, MOBILITY AND ATTRITION Tools for socially responsible staff reduction in Germany, personnel cuts (in FTE) PERSONNEL CUTBACKS REMAIN SOCIALLY RESPONSIBLE Early retirement, civil servants Early retirement, non-civil servants Severance payments Phased retirement (start of passive phase) Transfers to government authorities (final)1 Other socially responsible staff reduction options 2014 927 27 826 332 471 2015 1,219 29 1,448 1,345 711 11 2016 3,849 47 726 1,393 418 < 6 2017 27 61 1,081 1,687 417 15 2018 1,711 63 972 1,890 326 0 1 Permanent transfers; civil servants are not entitled to return to the Deutsche Telekom Group – established as a cluster in 2015. Deutsche Telekom continues to ensure that its personnel cut- backs are carried out in a socially responsible manner, using the tried-and-trusted tools of early retirement, severance pay- ments and phased retirement. Phased retirement is usually based on a block model, in which staff work full time during the first few years of the “active pha- se”, followed by a “passive phase” of equal duration, which then transitions seamlessly into regular retirement and a pensi- on. In 2018, 1,890 employees in Germany transitioned from the “active” to the “passive” phase of phased retirement. Additional- ly, 972 employees made use of our severance pay offers. The statutory regulations on early retirement for civil servants ex- pired at the end of 2016. The German legislators have intro- duced “dedicated retirement” as a follow-on scheme, which was used by 1,711 civil servants in 2018. A further 326 civil servants were permanently transferred into public administration roles. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 30

RECRUITMENT, MOBILITY AND ATTRITION Vivento employees (in FTE) SUCCESSFUL PLACEMENTS IN THE PUBLIC SECTOR 607 temporary internal placements Employees at Vivento 2,790 1,703 Vivento staff in external employment (Federal Employment Agency and other ex- ternal employment, particularly in the public sector) 480 permanent staff, support personnel, other employees at Vivento Employees permanently transferred to the public sector via Vivento in 2018: ......................................................... 326 Staff transferred to Vivento since its foundation: ..................................... 54,165 Staff leaving Vivento since its foundation: .............................................. 51,374 In 2018, once again, personnel service provider Vivento as- sisted the Group with its workforce restructuring efforts. In 2018, 326 Deutsche Telekom civil servants opted for a perma- nently transfer to federal, state or local government, many of them to the Federal Office for Migration and Refugees, the Federal Employment Agency, the Federal Armed Forces or the Customs Office. Vivento also helped employees to find individ- ual positions in federal, state and local government, encouraged by the growing demand for personnel at administrative author- ities. Approx. 800 employees at Vivento Customer Services were transferred to Telekom Service, while a further approx. 400 mo- ved to various segments in the core business. As a result of this, the number of employees under the care of Vivento was si- gnificantly reduced. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 31

SKILLS AND PERFORMANCE POTENTIAL Training, Group total DIGITAL LEARNING QUOTA INCREASES BY MORE THAN 10 PERCENT 53 % 19,023 47 % Attendance courses Digital courses Skills development via the global Learning Management System (LMS) No. of courses (via LMS) No. of digital courses (via LMS) No. of attendance courses (via LMS) No. of training days Ø Ave. training days per employee (in FTE) No. of digital training days 19,023 10,072 8,951 658,587 3.9 266,793 1.6 41 % Our employees around the globe spent 4 million hours on trai- ning and skills development in 2018. Digital formats account- ed for 41 percent of all learning, and we expect this figure to rise significantly in the future. Many of our courses can now be booked via the global Learning Management System (LMS); in 2018, digital courses already ac- counted for 53 percent of the training available for booking via the LMS. Deutsche Telekom firmly believes that learning should be inte- grated into the workplace. Digital learning formats offer out- standing opportunities for fast, flexible learning with identical conditions, anywhere in the world. By expanding our digital courses, we want to maximize the support given to our employees for honing their professional skills and encourage independent learning. In 2018, digital courses on agile working methods, design thinking, project management, cloud com- puting and other specialist topics proved particularly popular. The employee initiative “Learning from experts”, in which 160 experts have shared their knowledge with a community of around 2,500 colleagues in brief digital sequences to date, is a remarkable example of self-managed, autonomous learning. We also updated the Group-wide SkillsUP! scheme, following its successful pilot, and we are planning a phased rollout in 2019 and beyond. This approach centers around the interaction between three elements: The global job architecture - New market-compliant, Ø Ave. digital training days per employee (in FTE) Digital learning quota (proportion of digital learning hours in 2018) future-proof descriptions of jobs and skills Strategic qualitative HR planning - Transparently highlighting retraining options to allow early adaptation to demand and surplus capacities, and Skills management – Tool-based, individual assessment of skills, and, based on this, accurate and systematic training planning. In conclusion, this will create an unprecedented level of trans- parency, highlighting the potential for skills development among employees and for the company as a whole. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 32

SKILLS AND PERFORMANCE POTENTIAL Participants in international development programs (in heads) INNOVATIONS IN HR MANAGEMENT MAKE US MORE ATTRACTIVE TO APPLICANTS Start up! trainee program participants1 Total Start up! trainee program participants1 Of whom women Global Talent Pool participants2 Total Global Talent Pool participants2 Of whom women 2014 30 36 % 161 29 % 2015 31 45 % 300 32 % 2016 18 28 % 253 35 % 2017 32 50 % 858 25 % 2018 44 59 % 976 26 % 1 The program lasts 15 to 18 months. Annual new hires are shown. 2 Group-wide program for top talents. The program lasts approx. 12 months (starting every summer). As of 2017, it replaced the previous program “Talent Space”. Comparisons are difficult due to the new target group structure (now also includes executives). Our Group-wide development programs are designed to promote high potentials within the Group, keep them loyal to the company and place them in suitable roles. The focus is on developing and raising the visibility of talents and equipping them with the skills needed to tackle current and future challenges. At the same time, we want to enhance their sense of belonging, increase knowledge exchange and promote personal responsibility. The international trainee program Start up! is aimed at innovative graduates with an entrepreneurial mindset. Over a period of approximately 18 months, trainees get to know different areas of the company in Germany and abroad with a series of challenging project tasks. The program is complemented by a series of innovative training formats and events such as “Magenta Friday”, providing trainees with a forum for regular project collaboration to fulfill their mandate as drivers of culture and innovation within Deutsche Telekom. The Global Talent Pool is a key element of the talent management process, providing both a digital platform and a database for talent management within the Group. It gives HR and Recruitment personnel and managers transparency regarding our global talents and their individual profiles. In turn, the talents can join a closed group within our in-house social network “You and Me“ to plan their next career step and find strategic project placements and attractive job offers. They also enjoy exclusive access to a portfolio of digital development measures such as CV consulting, career interviews, e-training courses and mentoring, to help talents prepare for new roles. Our overarching objectives are to make it easier to find the right talents to fill vacancies, increase the visibility of our talents, and encourage rotation and networking throughout the Group worldwide. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 33

LEADERSHIP Participants in international development programs (in heads) OFFERINGS FOR MANAGERS AT ALL LEVELS Germany 30 % levelUP! 780 Participants International 70 % In 2017, we completely overhauled our management develop- ment program at Deutsche Telekom AG. 2018 saw the continu- ation of successful formats, ongoing improvements based on participant feedback and the redesign of individual courses. One example is the levelUP! Program, which was extended last year to include executives and was attended by more than 1,400 managers in 2017 and 2018. 2018 saw a shift toward partici- pants in Germany, who make up the bulk of executives within the Group. levelUP! is designed to help managers tackle future challenges and facilitate their own development journey. The program focuses on the culture of innovation and technology- based leadership, using a mixture of digital and attendance formats. LeveUP! is individually and flexibly structured to allow participants to create their own individual learning path using state-of-the-art techniques. Another success story is leadFIRST, a global, all-digital management transition program aimed at managers who have only recently taken on a managerial role. Its aim is to give these managers a clear and comprehensive understanding of their new role and create a solid management foundation in harmony with Deutsche Telekom’s leadership principles. It invites participants to reflect on their own interpretation of personnel leadership, hones their virtual leadership skills, and offers numerous opportunities for networking. The program has been updated in line with participant requirements, leading to increa- sed satisfaction levels. leadFIRST in figures: 173 participants from 21 countries 6 modules 8 live sessions We are committed to the continuous realignment and improve- ment of our portfolio. We collaborated with the business units to review all individual programs and decided to extend the highly successful levelUP! format to management positions below executive level, with the levelUP! NextGeneration program. This new program will replace FEP and LDP*, which ended in summer 2018 with a closing event for all 210 participants on the 2017/2018 program. LevelUP! NextGeneration will launch next year with a mixture of digital and attendance formats and offers a high degree of both flexibility and autonomy, encouraging this target group of individuals to forge their own development journeys. Our Leadership Aspiration Guide invites all employees to consciously analyze their own future by asking targeted questions, such as: Am I more of an expert or more of a manager, and what schemes and courses are available to me? We round off our manager offerings with a wide range of challenging training courses for future leaders. *Leadership Development Programs HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 34

Health rate in Germany (in %) HEALTH RATE STABLE HEALTH AND SAFETY Germany 2014 94.4 2015 94.0 2016 93.8 2017 93.7 2018 93.6 Nationally, the health rate for the Deutsche Telekom Group in 2018 showed a slight decrease of 0.1 percent year-on-year and stood at an average of 93.6 percent (including the long-term sick). This was mainly due to a surge in the incidence of flu compared with prior years, especially in weeks seven to eleven. Adjusted by the months January to April, the health rate for the rest of the year was up 0.1 % on the same period of the previ- ous year. Musculoskeletal disorders, respiratory diseases and mental health problems account for the bulk of illness-related absenteeism at Deutsche Telekom AG. Within Deutsche Telekom, there were significant structural and organizational changes which posed a potential risk to employees’ health, due to the associated psychosocial stress factors. In 2018, our company health management offerings focused increasingly on psychosocial stress factors. Additionally, targeted health prevention programs were implemented in the individual companies. Across all segments, we introduced or continued management training courses on the topic of “healthy leadership”. The aim is to sensitize managers to this issue and train them accordingly. Additionally, a structured absence management system will be put in place to ensure that employees and managers regularly communicate about illness-related absences so that appropriate action can be taken early on. We will broaden and intensify our programs focusing on the pre- vention of respiratory and musculoskeletal diseases, in order to target the most common causes of inability to work due to ill- ness. We have a range of offerings for employees and advise for managers to help tackle the growing scale of mental stress factors which significantly impact the length of absence. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 35

HEALTH AND SAFETY Work-related accidents in Germany (per thousand FTE) ACCIDENT RATE WELL BELOW NATIONAL AVERAGE 8.1 4.8 3.3 7.0 4.1 2.9 8.2 4.8 3.4 8.5 8.7 5.0 3.5 5.1 3.6 2014 2015 2016 2017 2018 Total number of work-related and commuting accidents Work-related accidents Commuting accidents The rate of work-related and commuting accidents showed a slight increase, but in absolute terms, the number of accidents was down on 2017. The accident rate is well below the average at comparable companies. We note that many accidents were the result of carelessness, e.g. people stumbling, slipping, falling or twisting their ankle. We therefore joined forces with the employers‘ liability insure- ance association to develop a special information format for the future. The increase in commuting accidents (accidents on the way to and from work) may well be due to longer journeys to work and the increase in traffic on the roads, with a large num- ber of accidents being the fault of third parties. Since com- muting accidents provoke lengthier absences than accidents which occur at work itself, we continue to manage and evolve our existing set of preventive measures. In 2018, Deutsche Telekom continued to offer its employees safe-driving courses at a discounted rate with provider ADAC. Training is available to users of company and service vehicles as well as private cars. Special driving training is also available for young employees and apprentices. These measures are designed to stabilize or improve the rate of commuting accidents. Deutsche Telekom has a health and safety management system in place to reduce the number of work-related accidents. This certified system makes it possible to map the entire health and safety process and to develop sets of measures to further improve employee safety. HR FACTBOOK 2018 PEOPLE. FACTS. DEVELOPMENTS. 36