Human resources

1 Excluding contractors
2 Average of regional minimum wage ratios
3 This refers to women who are actively engaged in operational mining activities
4 Non-management employees only. Turnover amongst managers is less than 1% in each year

Gold Fields has a total of 47,268 employees in service (C2009: 51,122). Of these, 93% are located in our South Africa Region (C2009: 94%). The remaining 7% are based in our Australasia, South America and West Africa Regions (C2009: 6%). The vast majority (97%) are nationals of the countries in which we operate. In South Africa, Historically Disadvantaged South Africans (HDSAs) comprised 93% of our local workforce at the end of C2010 – and 41% of employees at D-band and above.

All of our employees receive formal contracts of employment setting out their roles and responsibilities. These terms are explained to each employee during the recruitment process and during induction. Remuneration is based on pre-defined salary scales linked to an employee’s band and location – although these can be renegotiated with key employees in order to ensure that we retain their skills and experience. All of our employees receive more than local minimum wages and receive regular performance reviews. The ratio of standard entry level wages compared to local minimum wages range from 1.1 in South Africa to 6 in Ghana. This wide range is partly accounted for by regional variations in statutory minimum wages.

A significant proportion of our employees’ variable remuneration is determined both by individual and corporate performance. This ranges from a 30:70 performance ratio for executive level employees to a 70:30 ratio for specialist groups. All employees working in a managerial or supervisory role have Individual Balanced Scorecards, which assess performance in a range of areas. This not only includes financial and operational measures, but also sustainability measures including, for example, safety and environmental performance. Other employees are subject to production and safety targets.

Although they vary between locations, typical benefits include vacation, maternity and paternity leave, sick leave, medical support, pensions and life insurance. For example, in South Africa our employees rely on three main pension funds: the Mineworkers Provident Fund, the Mine Employees Pension Fund and the Sentinel Pension Fund. Other typical benefits include educational assistance, skills development, free or subsidised accommodation and/or living out allowances.

It has always been our intent to promote the ownership of Gold Fields shares by our South African employees. During C2010, we developed and implemented a R1.2 billion (US$172 million) Employee Share Ownership Plan (ESOP) that has resulted in a 10.75% equity ownership in our South African assets by all non-managerial employees in South Africa.

During C2010, large-scale forced retrenchments at our operations were avoided due to continuous natural attrition and voluntary separation. Nonetheless, the merger of our Kloof and Driefontein management teams with the regional executive structure as part of our business re-engineering programme in South Africa, resulted in a reduction of 115 middle- to senior-management positions. We intend to further reduce the size of our workforce in South Africa through natural attrition, voluntary severance packages and moving certain contracting services in-house. Forced retrenchments are at this stage not envisaged, but cannot be ruled out, depending on changes in underlying economics. The efficiencies the restructuring will secure will contribute significantly to the long-term sustainability of our South African operations.

The provision of quality training is not only an issue of improving employee productivity. It is also a key tool in our efforts to attract the best talent in an increasingly competitive labour market.

Our strong commitment to both the development of our employees and the strengthening of our long-term capabilities is demonstrated by the fact that during C2010 we invested a total of R229 million (US$31 million) in internal training and skills development across the Group. During C2010, our training facilities hosted a total of 70,000 employees and contractors (including multiple attendance by individuals), to increase their skills and enhance our capacity to meet our long-term production targets.

The maintenance of strong internal training institutions is integral to our approach. Our flagship in this respect is the Gold Fields Business and Leadership Academy in South Africa, on which we spent R175 million (US$23.9 million) in C2010. The Academy is accredited by the Mines Qualifications Authority, the Construction Education and Training Authority and the Institute of Leadership and Management. It offers a comprehensive range of in-house and on-site training courses including mining engineering, metallurgy and mineral resources management. The Academy is represented in a number of external bodies, including the Chamber of Mines Education Advisory Council, the mining advisory committees of the University of Witwatersrand and the University of Johannesburg and the Mine Education Trust Fund.

The Academy uses a unique training approach that focuses on tailored programmes adapted to each individual’s specific level, education and maturity.

In addition, once individuals have completed their training they are subject to subsequent follow-up and monitoring to assess whether continued support is required. Around 35,241 employees received induction and refresher training at the Academy during C2010, while 20,015 employees underwent new skills training. In addition, 2,997 employees attended Adult Basic Education and Training (ABET) programmes, 234 employees were engaged in engineering learnerships and 388 in mining learnerships. Learnerships are ongoing training programmes, which include both theoretical and practical training and lead to the award of nationally recognised qualifications. Furthermore, a total of 106 university bursaries were provided over the course of the year.

We also operate extensive portable skills training programmes, which are aimed at equipping employees for construction and other work after they leave Gold Fields.

“As the mining industry ramps back up in response to growing demand, talent shortages will become more pronounced”

Deloitte, Tracking the Trends 2011: The Top 10 Issues Mining Companies Will Face in the Coming Year

We are operating in a labour market characterised by strong competition for experienced technical, engineering and mineral resource specialists. Furthermore, our push to ‘regionalise’ the management of Gold Fields makes it imperative that we cultivate a strong and capable cadre of leaders within each of our regions. As a result, each region has a strategy in place to attract, develop and retain the best talent available. We continue to maintain our competitiveness in the labour market by regularly participating in industry market surveys. This not only helps us benchmark our remuneration practices, but also keeps us informed of industry developments relating to employee benefits and non-financial recognition programmes.

In Australia, where labour competition is particularly intense, we have implemented a new and comprehensive remuneration structure based on best practice within the region. This includes the delivery of better transparency, clarity and definition around pay and rewards. It also ensures that our salary review processes are now more forward looking in order to proactively anticipate expected market trends. Further initiatives implemented in Australia include:

• A new system of bonuses for our operational personnel
• Implementation of a performance enhancement process primarily using the Individual Balanced Scorecard methodology
• The offering of secondments to our other regions, as well as education assistance
• Promotion of a good and productive work-life balance
• Enhancement of our succession planning processes
• Development of a new 90-day ‘onboarding’ process for the full integration of new employees
• Development of a formal two-year graduate programme
• Plans for a centralised recruitment centre for the Australasia Region to allow for the more strategic sourcing of candidates

In Ghana, we have established a new ‘Career Path Framework’ for every employee. This is a ‘map’ on which each employee can plan and follow their career progression in terms of their skills, competencies and role requirements. It also serves as a useful audit tool, through which we are able to accurately target training and development at the right individuals.

In Peru, we started an internal leadership programme for all C-Band employees to identify staff that will eventually move into middle- to senior-management levels.

Leadership development programmes

These talent management initiatives are augmented by the roll out of our innovative leadership development programme from South Africa (where it was first piloted) to our other regions.

In Australia, for example, we have developed and implemented an innovative leadership development programme in partnership with the University of Western Australia and the Australian Institute of Management. The programme is closely tailored to our Values and leadership competencies, and is currently available to supervisors and middle management, with a further course planned for senior managers. In C2010, a total of 29 managers took part in this programme.

In Ghana, we have started a Senior Leadership Development programme with the Ghana Institute of Management and Public Administration. This programme includes attendance at the Darden School of Business at the University of Virginia in the United States.

A total of 13 senior officials have attended two one-week sessions to date. The programme is aimed at expanding the capabilities of our executives and senior managers – enhancing their professional development as well as the quality of Gold Fields leadership.

In Peru, we initiated a Programme for Leadership and Management for managerial personnel and a Programme for Leadership for supervisors. These are run in partnership with the University of Piura and DBM Peru, and cover issues such as leadership, human rights, executive coaching, technical skills and financial skills. We are in the process of finalising partnerships with three other universities in the country. A total of 13 senior employees completed the leadership programme last year.

In South Africa we use two major programmes to develop leadership talent. At the highest level, 15 of our senior staff have completed a leadership programme in conjunction with the Gordon Institute of Business Science, a leading business school in Johannesburg. At our Gold Fields Academy, we have rolled out the Louis Allen Leadership Development programme to senior, middle and junior management employees. In C2010, 881 employees benefited from this extensive programme.

By the end of C2010, none of our employees in Australia and Peru had opted to join unions. In contrast, 84% of our employees in South Africa and 92% of our employees in Ghana belong to unions. All employees belonging to unions are subject to collective bargaining agreements. These agreements include provision of minimum notice periods regarding operational changes that impact on their conditions of employment. In Ghana, this notice period is four weeks, whilst it is between 30 and 60 days for the majority of our employees in South Africa. We have formal structures in place to engage with trade union representatives, many of whom are full-time labour organisers at our mines. Other channels for dialogue with organised labour include:

• Established communication channels with human resource managers on all sites
• Employee representative committees
• Our website, intranet, newsletters and campaignspecific communications
• Employee climate surveys

Our relationship with our employees’ unions is constantly maturing. In April 2010, we proposed a new employee relations model and revised engagement structures to union representatives in South Africa, as part of our efforts to better understand employee concerns. Similarly, in October 2010 we agreed a three-year wage agreement with the Ghanaian Mineworkers Union. The agreement marks a considerable step forward, as it provides for mutually agreeable terms and will avoid the need for extensive annual negotiations. It is also further evidence of the particularly constructive relations we enjoy with the unions in the country.

Despite these advancements, in November C2010 we experienced a one-week industrial action called by the National Union of Mineworkers (NUM) at our South Deep mine in South Africa. The action focused on demands for greater union influence in Gold Fields procurement processes, as well as the appointment of senior management. This was resolved through constructive negotiation and a commitment to work with the NUM in the achievement of our transformation targets, without sacrificing our ultimate sanction and right to manage the business.

Human rights form a central pillar within our Sustainable Development Framework and are enshrined in our Code of Ethics and Human Rights Policy. As a signatory to the United Nations Global Compact, and as part of our commitment to the principles of the ICMM, Gold Fields upholds the highest standards for the protection of human rights. These include:

• Freedom from child labour
• Freedom from forced or compulsory labour
• Freedom from discrimination
• Freedom of association and collective bargaining

A key tool in our management of these issues is our Human Rights Toolkit, which we use to educate employees and contractors. It uses a range of innovative techniques to sensitise users to relevant human rights issues, including case studies, games, scenarios and multimedia communications materials. The Toolkit materials can be adapted to specific regional contexts and to different employee roles. This ensures that human rights training remains relevant and appropriate across Gold Fields. All of our induction programmes also include human rights elements.

Our human rights initiatives are supported by our internal grievance mechanisms, through which employees and contractors can raise human rights concerns. All grievances are handled by our human resources department, which uses defined guidelines to record, evaluate and address complaints. In addition, employees can raise individual concerns with independent, external counsellors and advisors through our Employee Assistance Programme. This sits under our ‘24 Hours in the Life of a Gold Fields Employee’ wellness programme.

During C2010, there were no incidents of discrimination. Where incidents of discrimination do take place, these are investigated and resolved internally. There were no incidents of forced labour or child labour at any of our operations. None of our operations represent significant risks in this respect – or to the rights of freedom of association and collective bargaining.

As our human rights capabilities mature, it is envisaged that we will integrate related requirements and commitments into our investment agreements and procurement contracts.

Gold Fields is committed to the creation and maintenance of a diverse and demographically representative workforce.

Empowerment of Historically Disadvantaged South Africans (HDSAs)1

In South Africa, workforce transformation is a matter of key national importance – as represented by the Employment Equity Act, the country’s Mining Charter and our Social and Labour Plan obligations (p165). Our primary contribution to workforce transformation has been to invest in the targeted education, training and development of our HDSA employees. Nonetheless, the development of highly skilled employees is a lengthy process. As a result, we are also recruiting experienced HDSA managers externally and placing them in key positions within the company.

Under the Mining Charter, which was revised in September 2010, we are required to ensure that 40% of all management positions are filled by HDSAs by 2014.

At senior to middle management level, we have achieved the following HDSA representation:

• 36% at Board level (C2009: 31%*)
• 15% at ExCo level (C2009: 27%)
• 32% at senior management level (E-Upper and above) (C2009: 25%)
• 40% at middle management level (D-Upper and E-Lower) (C2009: 37%)

Although we are making progress, more needs to be done to improve HDSA representation at all management levels.

1 All references to HDSAs is by reference to HDSAs including white women
2 This excludes foreign nationals that represent the regions we operate in

Representation of women

In line with our transformation commitments, we are also continuing to seek higher levels of representation of women throughout Gold Fields – from the mines to the boardroom. Women currently make up 7.4% of employees (C2009: 6.9%) across the Group. Of these, 3.3% are working in mining roles, 14.7% are in middle management roles and 2.7% are in senior management roles. At Board level, our female representation is 21%. This means we are ahead of the 20% target currently being considered by the Securities and Exchange Commission in the United States for 2013.

We are continuing to face a number of challenges in our efforts to attract women to the company. These include an inadequate pool of skilled female workers, as well as perceptions around the physical demands of mining. Nonetheless, the appointment of a female HDSA chair to the Board in November 2010 (p8) marks a key milestone in our efforts to drive transformation more broadly.

Employment of nationals

Although there is less regulation around the employment of nationals in Ghana and Peru, it is considered best practice and underpins our social licence to operate. Currently, 99.4% of our employees in Peru are Peruvian nationals (C2009: 99.1%).

In Ghana, nationals make up 96.9% of our workforce (C2009: 96.9%). We are working hard to ensure that nationals are adequately represented amongst our senior managers (currently 72%). This is largely being managed through an intensive succession planning programme. Under this programme, whenever we fill a post with an expatriate employee, we also develop a national employee using formalised Individual Development Plans. This means they will have all of the capabilities needed to fill this post in future.

Ghanaian nationals are increasingly being elevated to senior management positions in Ghana – including the general manager of our Tarkwa mine. Our efforts to recruit senior national personnel externally have been hindered, however, by local employment market conditions. Highly skilled nationals are in great demand, both nationally and internationally – in part, due to the growth of the West African mining industry. This is a common problem for mining companies operating in Ghana, and one that we plan to address through the significant revision of our remuneration and benefit packages to ensure that we remain competitive.