CORPORATE CITIZENSHIP

Labour relations

Settlement for an 8.5 per cent wage increase in the mining industry was reached between the National Bargaining Forum and represented unions. AEL was not adversely affected by the industrial action that preceded this settlement. Local relations, as demonstrated at the company's transformation forum and similar structures, remained sound and constructive. This benefited both the company and employees, particularly in terms of flexibility in human resource utilisation.

Chemserve participated in the annual national substantive wage negotiations, conducted under the auspices of the National Bargaining Council for the Chemical Industry. A dispute was declared by two unions and mainly peaceful industrial action, lasting two weeks, occurred at Chemserve sites where these unions have majority representation. The negotiating parties ultimately reached an amicable settlement.

Also in the Chemserve group, the planned closure of Industrial Urethanes' Sebenza site, in Gauteng, resulted unavoidably in manpower reductions. Early retirements, redeployment and last-resort enforced retrenchments, in line with the company's progressive practices and benefit structure, were effected.

SANS Fibres commenced a consultation process in terms of section 189A of the Labour Relations Act with the South African Textile Workers' Union (SATWU) in respect of the contemplated closure of some of its plants. The company issued notices in October and November, in terms of section 189(3) of the Labour Relations Act. The parties signed a memorandum of understanding in December to allow for a further month of consultation, affording the company the right to serve notice with effect from 1 February 2008.

Regrettably, 770 employees are affected. AECI has set aside substantial funds for retraining and developing the skills of retrenched employees. In partnership with SATWU, AECI has also undertaken to explore alternative job creation opportunities. SANS Fibres continues to assist retrenched workers in finding alternative employment.