Trade unions and employee participation

EMPLOYEE RELATIONS ("ER")

It is AECI’s policy not to tolerate any form of unfair discrimination, harassment, child labour, intimidation or bullying in the workplace. Group policies and standards guiding behaviour in these matters are in place and training is provided to management, shop stewards and employees to facilitate understanding and good relationships. The violation of policies and standards results in appropriate disciplinary action.

ER policies are reviewed and updated regularly to ensure continued alignment with business and legislative requirements. Formal contracts with all employees conform to local legal requirements and the core conventions of the International Labour Organization (“ILO”). These are reinforced by promoting fairness, equity and transparency in employment practices globally.

Labour legislation

To maintain statutory compliance, AECI implemented a number of initiatives in 2016.

In South Africa:

conclusion of recognition agreements in line with the amended Labour Relations Act, No. 66 of 1995, as amended;

alignment of the AECI Group Recruitment policy as it affects temporary employment;

termination of long-term temporary employment arrangements; and

improved management of temporary employment and labour broker contracts.

Legislative changes in Indonesia, where AEL operates, were:

the introduction of the requirement that employers as well as employees contribute to savings for public housing;

a new annual minimum wage policy;

the requirement for a religious allowance to be paid to employees with one month’s service instead of three, as was formerly the case;

a procedure for granting sanctions for non-compliance with government regulations in terms of pension, medical and accident insurance benefits; and

the obligation for companies to employ persons with disabilities, without discrimination.

Trade union and employee participation

AECI complies with the ILO’s conventions to drive and implement employee rights of freedom of association and collective bargaining. Concerted efforts are made to promote consultative forums at operating plant level so as to enhance mutually beneficial engagement between management and employees.

Constructive relationships are maintained with all representative trade unions that enjoy consultative and/or negotiating powers on issues of mutual interest.

A level of uncertainty remains in South Africa’s labour relations landscape owing to the formation of a new trade union federation that will compete with existing federations for membership and scope of operation. The chemical industry is not immune to the effects of this change.

Recognition agreements in South Africa are in place with all the main chemical industry trade unions. Similar agreements exist with recognised structures in other countries where the Group operates. About 47% of employees in South Africa are members of trade unions. Some 32% of employees are represented by the Bragaining Unit, with 27,5% being union members. Outside of South Africa approximately 59% of employees are represented by recognised trade unions.

Business restructuring

Restructuring processes were undertaken at AEL, Crest Chemicals and Experse in the year. Functional and administrative services at operating sites were consolidated, thereby enhancing the competitiveness and efficiency of these businesses’ cost bases.

Detailed and regular consultation with affected employee representative bodies preceded restructuring. Most affected employees were redeployed within the Group, resulting in fewer retrenchments. 
Of those employees who were retrenched, the majority opted for voluntary retrenchment and early retirement.

To support employees and their families in mitigating the effects of retrenchments, a number measures in line with the AECI Retrenchment policy and practice were implemented. There is a comprehensive social plan with benefits and services aimed at alleviating the hardship of job losses. The plan includes:

a competitive severance package;

counselling to address emotional issues;

financial and retirement workshops and counselling;

assistance in preparing curricula vitae;

training in interview and job search skills;

small business development training; and

re-skilling and training programmes.

Substantive collective agreements

Substantive collective agreements for Bargaining Unit employees in South Africa are negotiated on an annual basis under the auspices of the National Bargaining Council for the Chemical Industry. Settlement was reached for annual salary increases of 7,5%, effective from 1 July 2016 to 30 June 2017. The parties involved again displayed maturity in engagements and the annual substantive negotiations were concluded without any industrial action.

Wages and substantive conditions of employment for employees outside South Africa are negotiated with trade unions and other stakeholders on an annual basis, where such structures exist. In Burkina Faso, for example, the government is also involved in negotiations. In countries where there is no union involvement, management arrives at increase amounts based on labour market competitiveness, inflation and local remuneration survey data.

ER STRATEGY

An integrated ER strategy has been developed to enhance the workplace environment through sound employer/employee engagement underpinned by shared corporate values, harmonious relationships, ethics and the empowerment of employees. The strategy is aligned with the Human Capital function’s goals of promoting practices that enable leaders to improve employee engagement globally. Roll-out in South Africa is expected to be completed by the end of 2018 and globally by the end of 2019.

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Formally recognised unions [PDF - 64KB]

 

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