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Implats is a significant employer in the PGMs sector in both South Africa and Zimbabwe. A notable feature of the year was the significant number of contractors employed on major capital projects and recruitment related to expansions at Marula and Zimplats, thereby creating additional job opportunities in the areas in which the company operates.

The group employed a total of 54 991 people during the year of whom, 63% were permanent employees and 37% contractors. The increase in people employed in FY2008 was mainly attributable to the new capital projects started in the year. The significant number of contractors employed on major capital projects and recruitment for the Marula ramp-up and Zimplats expansion, created additional job opportunities at Implats.

A key feature of industry in southern Africa is the serious shortage of skilled personnel. This is particularly so in the mining industry and is an underlying factor in the continued high turnover levels experienced by the group during the year. Turnover levels at Marula (13%) and Mimosa (12%) were highest, with the overall group turnover at 8.9%. This compares with an estimated average turnover for the industry of around 18%. As discussed below, efforts to improve the retention of employees implemented at the beginning of the year were moderately successful.

Attracting and retaining talent

Attracting and retaining talented individuals who subscribe to the vision of the company continues to be an important driver of our group’s human resource management strategy. Particular cognisance is taken of the need to attract and retain women and employees who have been historically disadvantaged. Efforts to attract talent include the following:

• Housing: Implats has endeavoured over time to reduce the provision of hostel-style accommodation. Mining companies are increasingly becoming involved in the provision of housing in their areas of operation as the region experiences housing shortages. The provision of housing is also an attractive recruitment and retention strategy, and has many positive social benefits, as it improves the quality of life of employees, their health and well-being as well as that of their families. During the past financial year, the group has spent R307 million on the provision of housing for employees in both South Africa and Zimbabwe, with R350 million allocated to this in FY2009.
• ESOP: The group’s ESOP implemented in 2006 has provided some 28 000 employees (about 98% of all South African permanent employees) with a material stake in the growth of the company. See the economic performance section for comment on the economic appreciation of the ESOP during the year.

  The company undertook a communications drive to explain the process, allocation and benefits of the ESOP to all beneficiaries through briefs, presentations, printed material, posters and a video. It is unfortunate, however, that the concept of the ESOP – and particularly the time it takes for the investment to mature – is not well understood by all those it is meant to benefit, and an extensive ongoing education programme has been necessary to explain the value of remaining with the scheme. This is exacerbated by the lack of a culture of saving and the impact of the high-inflationary environment in South Africa.

• Reward schemes: The Ama-Ching-Ching Bonus Scheme, implemented towards the end of the 2007 financial year to improve productivity and generate wealth for employees, also had an initial and visible positive impact. The benefits, in terms of improved production and productivity, were not as long lasting as had been hoped, largely as a result of the industry skills shortage where many jobs (with rewards unrelated to performance) are available.

  The short- and long-term employee incentive schemes were reviewed and monitored. The effectiveness of the group’s retention schemes and fixed remuneration principles as related to middle and senior management and critical skills were also reviewed. Several retention mechanisms were implemented to retain specific critical and scarce supervisory and technically skilled employees. Quarterly benchmark audits ensure market competitiveness and internal equity relating to both fixed and variable rewards.

• Other initiatives: The talent management programme and graduate recruitment strategy were implemented throughout the group.

  Interventions such as the increase of learnerships, the upgrade of facilities available for learning and the implementation of skills development programmes to address critical vacancies, portable skills and accelerated development of high-potential employees focus on attraction and retention. Talent management focuses on career progression, individual development, mentoring and succession planning.

  The scarcity of skills in the industry precludes the company from adopting a policy of hiring only local employees. Where possible, however, efforts are made to recruit locally and, all else being equal, preference is given to local applicants.

Employment equity

Implats aims to provide satisfactory careers and career development plans for all employees. In South Africa, particular attention is paid to the attraction, training and development, promotion and retention of HDSAs. Specific mechanisms have been implemented to meet the HDSA management targets specified in the Mining Charter and include programmes related to skills transfer, preferential recruitment, accelerated training and a bursary scheme.

A talent management programme – undertaken at a cost of some R24 million in FY2008 (FY2007: R20 million) – is run for the South African operations. The programme, which was initiated in 2005, identifies internal and external individuals with promise, and develops and advances them.

Good progress was made towards achieving employment equity targets. At the end of FY2008, 33% of senior and middle management in South Africa were HDSAs (FY2007: 29%). If white women are included in this number, this rises to 45% (FY2007:40%). The Mining Charter requires that 40% of managers are HDSAs (including women) by 2009.

Women in mining

Good progress has also been made in achieving the participation of women in mining and programmes include career development planning, individual development programmes, accelerated training programmes, mentoring programmes and the creation of promotional opportunities.

At the end of June 2008, 8.3% of employees were women, while women made up 18% of board membership and senior and middle management. In FY2007, these figures were 5.8% and 16.5% respectively. The Charter requires that 10% of all employees are women by 2009.

Specific policies and programmes have been put in place to facilitate the entrance of women to mining, including a pregnancy policy and a sexual harassment policy. In addition, further surface change houses and underground ablution facilities have been provided.

* Note: The term HDSA refers to those employees as defined in terms of the MPRDA and the Mining Charter. This category is also referred to as Designated Employees in terms of the Employment Equity Act as having been historically disadvantaged and includes white women. Total employees in service as at June 2008 at the South African operations. The table includes nine non-executive board members

Training, education and development

Significant emphasis is placed on training and education at all levels within the company. A particular area of focus in South Africa is the provision of Adult Basic Education and Training (ABET) given the low levels of literacy (estimated at around 31%, at Impala Rustenburg). All employees at the Zimbabwean operations are literate, with literacy levels at corporate office, Marula Platinum and Impala Refineries ranging from 74% to 89%. In FY2008, 2 005 employees (FY2007: 1 031 employees) participated in ABET classes in South Africa at a cost to the group of some R26 million.

Total training expenditure within the group in FY2008 was approximately R215 million (FY2007: R174 million) with employees receiving on average between 70 and 84 hours of training during the year. A wide variety of training is offered, from technical training and safety training, to supervisor and management development.

There were 56 Implats bursary holders at the end of FY2008, studying at tertiary education institutions in South Africa in key mining and metallurgy related disciplines. These bursaries were provided at a cost to the company of around R3.2 million. Of the bursars, 95% are HDSAs.

In addition, the group provided 116 scholarships and 246 learnerships at a cost of some R15.8 million. Of the latter , 76% were HDSAs.

Employee relations

Employee relations in South Africa are governed by, among others, the Labour Relations Act, the Employment Equity Act, the Mine Health and Safety Act, the MPRDA and the Mining Charter. The employer/employee relationship is also influenced by the constitution of the countries in which the group operates, and by certain international regulations and conventions, including various International Labour Organization (ILO) declarations.

Specialist human resources, training and industrial relations personnel support line management in the management and development of human capital, and ensure compliance with legislation. Formal employee relations are largely governed by collective bargaining processes and recognition agreements, underpinned by the labour legislation of the countries of operation. Aspects that are covered include salaries and salary reviews, conditions of service, notice periods for operational changes, participation by employees or unions in various decision-making forums, among others.

Around 97.4% of the total South African workforce is unionised, or subject to a collective bargaining agreement. The two major unions recognised at the South African operations are the National Union of Mineworkers (NUM) (representing 62.4% of employees) and the United Association of South Africa (UASA) (6.0% of employees).

Labour relations in Zimbabwe are governed by the National Labour Act and by the collective bargaining agreement negotiated at an industry level by the National Employment Council for the Mining Industry. About 86% of the Zimbabwean workforce are covered by collective bargaining agreements. Workers’ committees are involved in operation-based interaction with management.

A two-year wage agreement entered into in July 2007 between South African unions and the company provided for an increase of 10% from 1 July 2008. The two-year wage agreement was subject to the prevailing annual rate of CPIX, which for June 2008 was 11.6%.

Wage negotiations were not undertaken in Zimbabwe during the year under review. However, owing to hyperinflation in the country, employee wages are reviewed continuously and significant increases have been granted at all levels.

A day’s production was lost at Marula in July 2007 owing to an unprotected strike action by employees regarding the annual bonus paid to officials. This was successfully resolved at the time. A further 14 days of production were lost at Marula in October 2007 following unprotected strike action by employees who demanded the removal of senior management. Constructive engagement ensued and the dispute was finally resolved in February 2008 when the NUM retracted its allegations. The dispute had a negative impact on labour relations during the period.

A one-day industry-wide protest related to safety was called by the NUM on 4 December 2007, resulting in a full day’s lost production. A single-day stoppage at the Ngezi trackless mine at Zimplats related to an employee demand for payments in non-Zimbabwean currency occurred during the year. Once employees understood that this was not legal, normal work resumed.

In addition to basic salaries, a wide range of benefits are provided to employees. These include medical aid, long- and short-term incentive schemes, share ownership and the ESOP programme, retirement funding, group life insurance, regional allowances, home ownership schemes, assistance with school fees (at Mimosa and Zimplats), and family funeral assistance scheme (at Mimosa), among others.

The company’s practice is to appraise employees’ performance against a set of predetermined targets. This takes place at various intervals, but at least annually for middle and senior management as part of skills management and the development of human capital. Performance appraisals for employees at middle and senior management levels are used in determining annual performance-based increases.

The group’s policy is to ensure that there is no discrimination between the payments made to men or women, or those for members of different race groups. Its practice is to remunerate employees equally based on position, value to the organisation, market-related remuneration and the experience and expertise brought to the company. Annual reports on employment equity are submitted to the South African Department of Labour.

Provision is made for lifelong learning and support is given for external education and training and the granting of sabbatical periods with a guaranteed return to employment, as well as the retraining of employees in the event of restructuring as required by the SLPs and in line with recognition agreements.

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