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HUMAN CAPITAL

TALENT MANAGEMENT AND PEOPLE DEVELOPMENT

A key requirement for achieving the strategic goals and objectives of the business is a highly skilled workforce. With the availability of skilled people, particularly in the technical and engineering disciplines, being an ongoing dynamic, there is a need to ensure an appropriate pipeline of skilled people to meet future skills requirements and for succession planning purposes. Targeted recruitment and market-related remuneration practices, coupled with effective performance and talent management, and mobility across operations play an integral part in ensuring that the organisation continues to have access to a highly skilled and competent workforce at all levels.

The capability profiles of teams and individuals are continuously being assessed against the required competencies and appropriate action is taken to address any gaps that are identified. Some of the interventions include talent management processes coupled with fast tracked development, training and development, recruitment from outside and addressing succession planning gaps by ensuring an appropriate pipeline of skilled people to meet future skills requirements.

Effective skills development practices at all levels is a priority and continues to be strengthened including supervisory, management and leadership development, learnerships, in-service training, operator training, general skills development of shop floor employees and effective coaching and mentoring processes. Competency gaps and individual training and development needs are being identified and action plans developed to address these needs. Action plans are developed to address the needs of high performing and highly talented individuals, with particular emphasis on black employees in the case of South Africa.

Action plans continue to be implemented to enhance the investment in skills upliftment and to improve the recording of all training and development expenditure related to on the job training in South Africa which contributed to an increased score on the skills development element of the B-BBEE scorecard. Expenditure in 2011/12 was 3,2 percent of payroll and it is envisaged that the investment in skills development should reach five percent of payroll by 2015.

EXISTING SKILLS

In the sugar operations, managers attend leadership and management development programmes offered by Treetops, while the starch operations have formed a partnership with the Wits and Stellenbosch Business Schools to address their unique requirements of management development and supervisory training respectively. The Mozambique operations have arranged for managers to participate in the UNISA Management Development Programme. In addition to formal training and development programs, there has been a further improvement in performance management, talent management and coaching and mentoring processes and these processes have now become well entrenched in most parts of the business. This includes clear roles and responsibilities, performance reviews, performance ratings, action plans to uplift performance and the implementation of the principles contained in the reward philosophy including market related remuneration and differential rewards for high achievers and outstanding performers. Coaching skills training is done through Wits Business School and UCT Business School. Where appropriate, reasonable accommodation of work/life balance, for example in the form of flexible work arrangements, continues to be used as one of the ways to accommodate the needs of particular employees, which contributes to the retention of talent.

Appropriate organisational transformation is encouraged to facilitate Tongaat Hulett being managed as one company across all countries where functionality is based on expertise instead of hierarchy / function and the encouragement of multiskilling and multiple relationships. This transformation includes improved region wide communication and inculcating a sense of belonging amongst all employees in all operations. Task based processes and the encouragement of dynamism, decentralisation, growth, results-orientation, indigenisation, innovation and sustainability are being reinforced. In addition, an organisational climate is being nurtured to unlock the emotional energy and company commitment of employees and to assist in building Tongaat Hulett into an employer of choice.

Bursaries, scholarships, trainee programmes and learnerships continue to be sponsored by the company to assist with sourcing and developing young talent in anticipation of future skills requirements. To support these programmes, strong partnerships have been formed with select educational institutions and Sector Education and Training Authorities (SETAs). Workplace skills plans and implementation reports are submitted to the relevant SETA on an annual basis.

Recruitment strategies include the use of psychometric assessments and web-based recruitment linked to Career Junction. Partnerships and relationships with education institutions continue to be strengthened with institutions such as the University of Witwatersrand (Wits) (Electrical Engineering/Process Control), the University of KwaZulu-Natal, Mangosuthu Technikon and the Durban University of Technology.

Total training spend	R32,1 million
1 percent skills levy	R10 million
Training spend as a % of leviable amount	3,2 % (excluding 1% skills)
Number of people days trained	8 592
Number of people days available	1 591 110
% trained people days	0,5 %
Number of people trained	1 798

EMPLOYMENT EQUITY AND INDIGENISATION

Tongaat Hulett values the dynamism that a multi-cultural human resource base brings to its business and employees in the Swaziland and Zimbabwe operations consist almost exclusively of local citizens. While slowly improving, there continues to be a shortage of suitably qualified people in Mozambique and consequently there is currently a higher number of foreign nationals employed at these operations than might be expected. Initiatives implemented to address this anomaly include a program to employ and train local citizens.

The total workforce as at 31 March 2012 across all countries was 41 777 compared to a total of 39 314 the previous year (full time employees, casuals and contractors). Employee turnover (all categories including retirements, retrenchments, deaths, dismissals etc.) within the South African operations was 5,6% compared to 9,3 percent in 2011 and 10% in operations outside South Africa compared to 6,5 percent in 2011.

EXISTING SKILLS IN ALL COUNTRIES

Period	Number (as at 31 March 2012)	Average Age (as at 31 March 2012)	Number Terminated (1 April 2011 - 31 March 2012)	Number Appointed (1 April 2011 - 31 March 2012)
Degrees/Diplomas	1 057	39,1	41	71
Artisans	506	40,5	28	47

AVERAGE AGE AND LENGTH OF SERVICE (PERMANENT EMPLOYEES) AS AT 31 MARCH 2012

Level	Average Age	Average Length of Service (years)
Top Management	51	19
Senior Management	50	18
Middle Management	45	14
Skilled and Supervisory	41	12
Semi-Skilled	41	15
Unskilled	39	9
OVERALL	40	11

In South Africa there continues to be a need to address the imbalances of the past and a strong employment equity culture has been fostered over many years. Actions are continuing to improve the representation of designated groups, with particular emphasis on Africans, black women and persons with disabilities, with the intention to align the workforce profile with the underlying demographics of the country. As at 31 March 2012, 57,4 percent of management and 82,4 percent of skilled and supervisory positions are filled by black employees. Women constitute 34,6 percent of the workforce across South African operations. Within the South African operations, 73,4 percent of the 587 graduates and diplomates employees are black, with women constituting 45,3 percent.

Employment equity plans are in place to meet the employment equity goals that have been set for December 2014. These plans include targeted recruitment and placement, coupled with talent and performance management, training and development, coaching and mentoring and managing cultural diversity. Recommendations have been received from the Department of Labour, following their review of the Tongaat Hulett employment equity practices and action plans are in place to implement the recommendations.

The Tongaat Hulett Employment Equity Committee is chaired by the CEO and the broad composition of this committee ensures that it benefits from company wide experience and expertise in achieving its objectives. Its main objective is to review target setting and progress on all employment equity related matters and to make recommendations on the implementation of employment equity policies. These policies are based on equal opportunity for all within a diverse workforce with a substantial number of members of designated groups at all levels. The implementation of these policies is facilitated by appropriate performance and talent management processes, recruitment targets, development and training programmes, coaching and mentoring and innovative management development practices.

These programmes, targets and practices enjoy priority as a key business objective and constitute an integral part of management’s performance assessment.

The table below reflects the employee profile of the company’s South African operations as at 31 December 2010, which formed part of the Tongaat Hulett employment equity report submitted to the Department of Labour (DoL).

The overall proportion of black representation in management as at 31 March 2012 was 57,4 percent of permanent staff at this level, compared to 56,4 percent at 31 March 2011. It is envisaged that by 2014, black representation at management level (D band and above) will exceed 60,0 percent. Females at senior management level increased from 12,0 percent to 12.3 percent as at 31 March 2012, the proportion of black females in top management increased from 16,7 percent to 19,2 percent as at 31 March 2012 and black females in management increased from 18,6 percent to 19,6 percent in March 2012. There were 81 employees with disabilities as at 31 March 2012, which constituted 1,3 percent of the employee complement (63 employees with disabilities as at 31 March 2011).

The table to the right reflects a year on year comparison of black employee and women representation in proportion of permanent staff at various levels at as 31 March 2012.

LATEST EMPLOYMENT PROFILE AS AT 31 DECEMBER 2010 SUBMITTED TO THE SA DEPARTMENT OF LABOUR

Occupational Levels	Male				Female				Foreign Nationals		Total
	A	C	I	W	A	C	I	W	Male	Female
Top management	4	0	1	14	2	1	1	0	1	0	24
Senior management	20	3	23	58	4	2	5	3	2	0	120
Professionally qualified and experienced specialists and mid-management	58	7	40	69	35	3	20	26	6	2	266
Skilled technical and academically qualified workers, junior management, supervisors, foremen, and superintendents	337	61	229	131	170	18	54	63	12	6	1 081
Semi-skilled and discretionary decision making	1 017	21	128	4	208	5	34	10	2	0	1 429
Unskilled and defined decision making	1 217	0	11	2	1 049	0	1	0	9	0	2 289
TOTAL PERMANENT	2 653	92	432	278	1 468	29	115	102	32	8	5 209
Temporary employees	61	7	8	0	18	0	1	0	0	0	88
TOTAL (SOUTH AFRICA)	2 714	92	440	278	1 468	29	116	102	32	8	5 297
Total workforce in ALL COUNTRIES as at 31 March 2012											41 777

Note: A = African, C = Coloured, I = Indian, W = White

	Actual as at 31 March 2010	Actual as at 31 March 2011	Actual as at 31 March 2012
Top Management who are black	38%	38%	39%
Top Management who are women	17%	17%	19%
Senior Management who are black	46%	48%	50%
Senior Management who are women	12%	12%	12%
Middle Management who are black	60%	62%	63%
Middle Management who are women	30%	32%	34%
Skilled and Supervisory who are black	80%	82%	82%
Skilled and Supervisory who are women	26%	27%	29%

There were no retrenchments at executive management level. However, in the year ended 31 March 2012, several contractors completed projects resulting in the nonrenewal of their contracts. There were 81 retirements.

HUMAN RIGHTS

Within its sphere of influence, Tongaat Hulett guarantees protection for basic human rights. The company is a signatory to the Universal Declaration of Human Rights, in which it commits, among others, to supporting the freedom of association and collective bargaining at its locations as well as preventing child labor and forced labour. Tongaat Hulett has incorporated human rights principles in its practices, and operates within a Code of Business Conduct and Ethics, which supports its commitment to a policy of fair dealing, honesty and integrity in the conduct of its business.

This is based on a fundamental belief that business should be conducted honestly, fairly and legally. The company expects all employees to share its commitment to high moral, ethical and legal standards. The company has always strived to maintain a constructive relationship with unions and a climate of industrial peace has generally prevailed. There are recognition agreements with 10 different unions as at 31 March 2012 and approximately 78.1 percent of permanent employees are members of unions.

FREEDOM OF ASSOCIATION AND COLLECTIVE BARGAINING

Tongaat Hulett employees have the right to freedom of association. This right is also entrenched in the company’s code of ethics, business principles and policies.

Trade unions formally recognized are:

• Botswana – Botswana Beverages and Allied Workers Union (BBAWU)
• Mozambique – Sindicato Nacional dos Trabalhadores da Industria Do Açucar e Afins (SINTIA)
• Namibia – Namibian Food and Allied Workers Union (NAFAU)
• South Africa – Food and Allied Workers Union (FAWU); National Sugar and Refining and Allied Industries Employees Union (NASARAIEU); South African Agricultural Plantation and Allied Workers Union (SAAPAWU); United Association of South Africa (UASA)
• Swaziland – Swaziland Agriculture and Plant Workers Union (SAPWU)
• Zimbabwe – Zimbabwe Sugar Milling Industry Workers Union (ZSMIWU); Zimbabwe Hotel and Catering Workers Union (ZHCWU)

There were industrial action incidents that resulted in 23 days lost in Mafambisse and Xinavane for the period under review. The financial cost impact was R4 466 798.

DISCIPLINARY PROCEDURES

The disciplinary codes and procedures make provision for corrective behavior and have been drawn up in order to apply discipline in a just, equitable, non-discriminatory and consistent manner, in line with the relevant labour legislation. If any employee feels unjustly treated, they are entitled to exercise their rights in terms of the particular operation’s internal appeal procedure and the relevant legislation.

Disciplinary codes and procedures have been implemented at local operations, after negotiations with the relevant trade unions.

GRIEVANCE PROCEDURES

The company’s grievance procedures are intended to create an environment that is conducive to good employee relations, by facilitating prompt and fair action by the company when employees raise legitimate complaints. The intention of the grievance procedures is to ensure that grievances are resolved as near to their point of origin as possible, and within a reasonable time frame.

CHILD LABOUR, FORCED AND COMPULSORY LABOUR

Tongaat Hulett does not make use of child labour and does not tolerate the inhumane treatment of employees, including any form of illegal forced labour, physical punishment or other abuse.

ANTI-BRIBERY AND CORRUPTION

The upholding of Tongaat Hulett’s core values requires that the business actively works to prevent corruption and bribery. The organisation has procedures in place that provide guidance on areas such as dealing with gifts and donations. Employees of Tongaat Hulett who do not comply with the company’s Code of Ethics policy face disciplinary action, including dismissal or termination of their contract.

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