Annual Report 2007 - Antofagasta plc

Corporate Social Responsibility continuedCSR REPORTDuring 2007, Los Pelambres and Michilla reachednew agreements with their unions for periods of up tofour years, approximately six months ahead of the duedates for each negotiation, thus underlining the goodlabour relations existing across the Group. El Tesoro inits most recent negotiation in 2005 had its collectiveagreement approved by 85% of the workforce, oneof the highest of the industry.Sub-contractorsThe Group’s approach is to consider contractors asvaluable strategic partners with the aim of maximisingvalue for both parties and the Group’s companies havedeveloped sound practices for working with contractorcompanies. The policy outlining working relationshipswith third parties and sub-contractors is contained ina Group policy manual. Sub-contractors are subject tothe same obligations and responsibilities as employeesand contractors’ personnel are encouraged to followthe Group’s human resources policies and bestpractices.At El Tesoro, for example, a management modelhas been established on the following fundamentalprinciples, so as to ensure that El Tesoro’s ownobjectives regarding optimisation of its operationsin a sustainable manner are met:• tasks where a third party can generate a higherlevel of value added must be outsourced;• the tasks to be outsourced must clearly andexplicitly be defined as products or services thathave tangible, measurable and identifiable results;• the collaborating company is considered to bea strategic partner; and• the collaborating company assumes fullresponsibility with regard to its business andits own resources and personnel.This management model requires full compliancewith contractual and legal requirements as wellas applicable internal standards. Key aspects ofthis relationship are monitored on a regular basisthrough an annual auditing process carried out byan independent party including commercial, labour,operational, technical, social security and tax, healthand safety and environmental aspects. The resultsover the last three years have been outstanding witha 90% compliance rate.Similar practices are carried out in other operations.At Michilla, labour audits are regularly carried out oncollaborating companies to ensure their compliancewith legal requirements and to allow Michilla todevelop action plans for improvements as necessary.Michilla has also established performance agreementsin each commercial contract with collaboratingcompanies. These agreements, which are reviewedannually, allow workers from the collaboratingcompanies to participate indirectly in the resultsachieved by Michilla.Law 20123 came into effect in Chile in January 2007.The legislation is aimed at helping workers ensuretheir rights. One of the main features of this legislationhas been to require certain companies to directlyemploy a number of workers who were previouslysub-contracted. The Group believes that continuedgood management of the relationships with contractoror collaborating companies is crucial to complying withthe new obligations imposed by the recent legislation.Occupational HealthThe very nature of the Group’s activities meansthat those involved could suffer health problems.However the Group is committed to providing ahealthy workplace for its employees and contractors,eliminating occupational illness and managing healthexposures. In addition Chilean legislation covers mostaspects of health through the Sanitary Code, the BasicCondition Regulations for Working Areas, MiningSafety Regulation, and specific regulations for foodhandling, radiation exposure, noise exposure, workaccidents and illnesses and the Group seeks to meetor exceed these standards.All the principal business units have occupationalhealth and safety policies, and each operation orproject is responsible for setting its own objectivesand targets and communicating them to employees,contractors and, where applicable, the localcommunity. These measures are underpinned bystrong leadership from senior management andoperational heads. Management systems certifiedunder OHSAS 18.001 are in place in nearly all ofthe Group’s business units. Health policies focuson minimising risk through preventive measuresand raising awareness of health issues; medicalsurveillance and voluntary testing; monitoring46Antofagasta plc Annual Report and Financial Statements 2007