Employees

Xstrata employs approximately 24,000 people globally, including contractors. Xstrata Coal is the largest employer in the Group, accounting for 45% of the total number of employees, with operations in Australia and South Africa. At 22%, Xstrata Alloys is the second largest employer with its entire workforce located in South Africa. Almost half of Xstrata's employees are based in South Africa, with 37% located in Australia.

*Excludes unallocated

Human resources functions within each commodity business are headed by a General Manager Human Resources who reports to each commodity business CEO.

Employee turnover across Xstrata is relatively stable, varying from 6% in the Technology division to 15.7% in Xstrata Zinc. Overall Group turnover increased slightly from 10.1% in 2004 to 10.3% in 2005. During the current high commodity price environment, competition for skilled labour is particularly high, especially in mining areas such as Queensland and for skilled HDSA employees and managers in South Africa.

In 2005, a total of 92 days of industrial action occurred at a number of coal and chrome operations, related to wage, collective agreement or contract negotiations, including the Rustenburg and Wonderkop chrome operations and Horizon chrome mine in South Africa, New South Wales and Queensland coal operations in Australia and a one-day national stoppage which affected our South African coal operations.

In 2005, Xstrata's operations created an additional 1,059 new positions (this excludes the replacement of employees leaving) of which 1,002 or 95% were filled by people local to the operation concerned.

Workplace equality

Xstrata has comprehensive programmes and processes in place to ensure a work environment and terms and conditions of service which are free from discrimination. Clear expectations are set for management, performance is monitored against these and action is taken in response to any non-conformance. All employees receive our Statement of Business Principles in their first language and these principles form an integral part of our induction process for new employees and contractors. All employees are treated fairly and with respect. Discrimination is not tolerated in the workplace. Active measures are taken to promote the implementation of this policy, including the preparation of an annual plan at our Australian operations and submission of an annual report to the Equal Opportunity Commission. All human resources policies and all decisions affecting employment and career development are based on the principle of individual merit. Policies such as the Fair Treatment at Work Policy, Equal Employment Opportunity Policy, Sexual Harassment Policy, Data Protection and Privacy Policy, Risk Management Policy and Fraud Control Policy are reinforced through contracts of employment, inductions, tool box talks and ongoing refresher training.

Lorena Chirivella, Environmental Officer, monitoring water near the Vis Vis River, Minera Alumbrera

Xstrata has a grievance policy and procedure in place which all employees can access if they believe that they have been unfairly discriminated against. This process is managed at the commodity business and site level. A toll-free, confidential ethics line has also been established and this mechanism and feedback results are described in the Governance chapter.

Compliance with the Business Principles is a fundamental part of any assessment of our employees' performance and non-compliance with any element of our Business Principles automatically results in disciplinary proceedings. We have a number of systems and forums in place that encourage employee feedback and ad hoc surveys are undertaken by commodity businesses or divisions. Daily, weekly, monthly and quarterly management briefings occur at all levels of the business and are the main mechanisms by which employee feedback is elicited. We also use notice boards, newsletters, video messages and email notices to keep our employees and contractors up to date with important initiatives across the Group. Employee feedback is encouraged through a range of processes, including the performance appraisal system and monthly meetings between operational managers and employee representatives.

Xstrata's support for the Universal Declaration of Human Rights and the International Labour Organization's Declaration on Fundamental Principles and Rights at Work is set out in the Business Principles.

Xstrata upholds the elimination of all forms of forced and compulsory labour and excludes the use of child labour. All sites report the age of their youngest employees and are audited through the internal audit risk management programme.

Employee representation

We recognise the right of our employees and contractors to freely associate and join trade unions and this information is shared with potential employees. We have a number of operations that have a mix of collective and individually regulated employment arrangements.

In Australia the main union is the CFMEU. Other unions include the APESMA, AWU, ETU and AMWU. Our Australian operations do not collect information pertaining to union membership as this is prohibited under the Privacy Act 1988.

Shift Overseer Naas de Jager and Monjane Dhide at the morning safety meeting at Boschmans coal operation

Workforce diversity

Xstrata supports equity and diversity in the workplace and manages this according to the cultural and legislative requirements of the host country. Xstrata's Employment Policy respects the labour standards laid down by the International Labour Organization's Fundamental Conventions, and these commitments are found in our Business Principles.In South Africa, employment equity programmes – particularly aimed at HDSAs and women – are required under the terms of the Mining Charter and are managed via equity plans and skills development plans (see employment equity).

Across the Group, we seek to increase the number of women in our workforce through recruitment initiatives and we are working to improve the provision of flexible work arrangements, such as flexitime and childcare facilities. In 2005, women accounted for 8% of Xstrata's employees and held 12% of all management positions. A member of our Executive Committee is responsible for monitoring our equal opportunity performance.

In 2005, all Xstrata commodity businesses increased the number of women employed compared with 2004. Xstrata Coal increased the number of women at its Australian operations from 4.4% in 2004 to 6.4% in 2005. In South Africa, women accounted for 8% of our Xstrata Coal and Xstrata Alloys employees, on target to achieve 10% by 2007. Training programmes in South Africa enable potential employees to be trained in preparation for permanent employment. In 2005, 60% of our South African education bursaries were awarded to women. Xstrata Copper has increased the number of women it employs from 10.9% in 2004 to 13.7% in 2005 and 20 of these women hold managerial roles.

Training and development programmes

Xstrata is committed to working with employees to help them reach their full potential through on-the-job training, specific technical courses and leadership development programmes. Training and development needs vary from business to business and are identified through performance reviews which are conducted at least annually across the Group and from informal discussions between employees and their supervisors. In 2005, the average number of training days was 9.4 per employee.

Apprenticeships, tertiary education, bursaries and scholarships

In recognition of the importance of supporting the development of future employees for the mining industry and addressing the declining trend of students entering mining-related subjects at universities, Xstrata offers a significant number of trades apprenticeships, graduate traineeships, bursaries and scholarships across its global operations and provides further support to universities to support future recruitment. In South Africa in particular, we have implemented a systematic approach to investing in the skills of our future workforce, at the primary, secondary and tertiary education levels, and through university bursaries, scholarships and the establishment of university chairs.

Apprenticeships

• 87 trade apprentices at Xstrata Coal Australian operations for electrical and mechanical tradespeople, consisting of a mix of on-site, off-site and TAFE training undertaken over four years;
• 149 trainee engineering and mining apprenticeships in South Africa;
• 'Learnerships' offered to members of the broader community in South Africa, including Mines Qualifications Authority training as apprentices;
• 59 new apprenticeships at Mount Isa Mines in 2005, increasing to an intake of 72 in 2006 and a further 70 or more apprentices starting in 2007;
• Alumbrera copper mine in Argentina offers an apprenticeship programme for students of technical schools and the universities in Tucumán and Catamarca; and
• Nordenham zinc smelter in Germany offers two apprenticeships a year.

Education support

• Xstrata launched the three-year EQUIP school improvement programme in December 2004, working with provincial government in South Africa, to improve the governance of 20 schools and the quality of primary and secondary teaching;
• 50 students from local communities in South Africa participate in a one-year residential study programme provided by Xstrata to improve students' University entrance exam results. Candidates who receive a University pass are encouraged to proceed with tertiary education and apply for an Xstrata bursary. This programme has been implemented as an interim measure, to supplement education support for those children who will not benefit from the schools improvement programme;
• Two-year training programme for 25 Australian university graduates in the fields of mining engineering, mechanical and electrical engineering, surveying, accounting, occupational health and safety, and environmental science;
• Graduate development programme at the Stellenbosch Business School, South Africa;
• Xstrata Copper's Mount Isa operations employed 42 graduates in 2005 and offered vacation employment for 41 university students;
• In Spain, Xstrata Zinc provides professional training for students on site during a summer course;
• In 2005, Minera Alumbrera provided work placements for more than 30 students from the universities of Tucumán and Catamarca, and hired 40% as permanent employees; and
• Through its partnership with Spinifex State College and the Good Shepherd Catholic College in Mount Isa, Xstrata awarded 14 students with school-based bursaries at the beginning of 2005 and a further 14 students in November 2005 for the 2006 school year.

Scholarships and bursaries

• Over 100 bursaries provided for HDSA students in South Africa and 74 work experience placements and on-the-ground training to bursars during the vacation period;
• Scholarships and financial assistance to 34 students in Australia;
• Assistance provided directly to the Universities of Cape Town and Witwatersrand to assist HDSA students studying mining and related disciplines;
• Minera Alumbrera provides an annual scholarship for mining engineering students at Catamarca University to study metallurgy at a Dutch university; and
• One scholarship is provided on the European Mineral Engineering Course (EMEC) at Camborne School of Mines in the UK, through a joint initiative with Anglo American and Rio Tinto to support mining-related tertiary education in Europe. Xstrata is also a member of the Federation of European Mineral Programmes.

To further support tertiary education, Xstrata funded two university chairs in 2005 – ZAR1.7 million for a Chair of Geology at Rhodes University in South Africa and AUD1.5 million for a Chair of Metallurgical Engineering at The University of Queensland.

Apprentice Electrician Krystine Cameron replaces a faulty isolator at the Mount Isa copper concentrator