 The rising consumption of commodities in a shrinking global village has brought with it many business challenges, with the retention and attraction of key skills in the mining sector being a focal point in maintaining a competitive edge, states JSE-listed copper-miner Palabora.
After a 42% turnover of critical skills in 2007, the company decided to introduce its employee value proposition in June last year. Palabora human resources executive Percy McCallum says that the proposition proved very effective. “Compared with the 42% turnover in 2007, the company’s turnover dropped to 18% in 2008 and, up to June this year, to a mere 10%.”
In addition to the employee value proposi- tion, the company also introduced an attrac- tion and retention scheme for its lower-level employees. “All our artisans level and above are now on a preretention scheme that pays out yearly, provided the employees stay with the company.”
Competitive Conditions
McCallum says that the Rio Tinto-managed company is able to provide employees with a safe working environment, competitive conditions of employment, a talent-manage- ment programme that includes succession planning and people development, challenging work, exciting career opportunities and a clear performance-management system.
The proposition is aligned with the Rio Tinto group’s human resources planning priorities for the period between 2008 and 2011.
“The company aims to retain and attract key skills, to foster stability and business excellence, and to meet employment equity targets. The focus is, and always has been, to ensure that all employees are excited about, as well as self-motivated and committed to the organisation,” says McCallum.
In 2008, Palabora improved its employment-equity statistics to meet legislative requirements. Its efforts resulted in designated groups of employees comprising 44,6% of professional and executive levels.
Palabora has a planned life-of-mine for the copper business, of eight years, with plans for further expansion. Its total life-of-mine extends to 30 years, when the magnetite and vermiculite businesses are included.
The single shaft mine provides South Africa with 85% of its copper requirements. In 2008, Palabora produced more than 32 000 t/d of copper and one-third of the world’s vermiculite.
The mine is also in the process of finalising its broad-based black economic-empowerment (BBBEE) deal, which will result in 26% of its operations being owned by a BBBEE group comprising employees, the community around the mine and key individuals.
McCullum assures that the company’s BBBEE structure will be in place before the end of this year and that the structure will be in operation from 2010. The company decided to allocate 10% to its employees, 10% to the community and 6% to a consortium of key individuals.
The deal is primarily focused on deve- loping the communities and is a culmination of a key-stakeholder consultation process that Palabora had undertaken, since 2007, and in which five different ethnic groups in the Ba-Phalaborwa community will benefit.
Subsidiary Company
The Makhushane, Selwane, Maseke, Mashishimale, and Majeje people will own 10% of the equity in a newly formed special- purpose subsidiary company of Palabora.
This process is close to completion and further benefits will flow to the communities when the transaction is finalised. Further, the Palabora mine will continue to be a significant contributor to the Phalaborwa economy, says McCallum.
He adds that, through the Palabora Foundation, the mine has a long-term com- mitment to develop and maintain sound relationships with neighbouring communities based on transparency, trust, mutual respect and active partnerships.
This is achieved through working with communities in education, skills development, business development, health, local economic development and tourism facilitation.
The foundation has a budget of R35,9-million for this year, of which 65% will be spent on education programmes to benefit the local community.
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