Workforce status and trends

The sustainability of our workforce is a key concern for Xstrata – the safe and effective management of our operations depends heavily on our ability to retain talented employees and managers. A particular challenge is ensuring we attract and retain staff with the necessary skills and competencies to manage our pipeline of major growth projects.

As the mining sector recovers from the downturn brought on by the global finance crisis of 2007-08, competition for skilled workers and managers is beginning to intensify – particularly in Australia. We make every effort to ensure we offer competitive salary packages and top-tier career development prospects. In addition, we are working via the respective national mining industry associations to encourage government education policies and priorities that will help ensure that skilled labour and management resources meet future demand.

At the end of 2010, Xstrata’s workforce comprised 38,561 employees and 32,186 contractors. Of these employees, 98% were full time and 93% held permanent positions. Xstrata’s total workforce (employees plus contractors) increased by 12,066 people – over 21% – between 2009 and 2010, and contractors increased by over 45% or around 10,215 people. This reflects increased production at existing sites and the ramp up of our substantial organic growth programme.

We track our workforce performance in a number of ways, including:

• Redundancies: this is the total number of employees made redundant during the reporting period and includes both voluntary and forced redundancies;
• Voluntary turnover: the sum of people who accept voluntary redundancy plus people leaving the business because they resign or retire;
• Compulsory redundancies: terminations resulting from performance and non-compliance issues; and
• Total departures: the number of departures from the company whether voluntary, forced or compulsory.

In 2010, a total of 2,747 employees voluntarily left our business – either because they resigned, retired or accepted voluntary redundancy. This represents an increase in our voluntary employee turnover rate as compared with 2009 from 6.4% to 7.1%. Male turnover exceeded female turnover in all regions across the Group. Turnover in all regions apart from Europe was greatest in the 30-50 year age group. In Europe turnover was greatest amongst those employees who were over 50 years old.

During 2010, there were 4,927 departures from Xstrata, of which 2,747 were voluntary, a significant increase on the 1,017 total departures recorded in 2009. The vast majority (82.6%) of departures were male employees. The commodity business with the highest number of departures was Xstrata Copper with 18% of the total and the business with the lowest number was Xstrata Technology with 7% of the total. The proportion of overall departures taking place in Africa significantly reduced from 13% in 2009 to 8% in 2010. The region with the highest number of departures was North America (23% of total) followed by Australasia (15% of total).

In 2010, we recruited 4,571 people compared with 2,411 in 2009. About half of those new hires were in South Africa, where government guidelines strongly encourage the hiring of historically disadvantaged people. Our businesses give preference to local residents where possible (and where legal) when hiring. In total, 80% of the people hired in 2010 were from local communities.

Absenteeism, measured as employee days absent per million hours worked, has steadily been climbing since 2007 and reached 5,487 in 2010.