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Old
Mutual is committed to recruiting, developing and retaining
highly effective people that maintain the highest ethical standards
in all business practices. To create and sustain an environment
that supports this, we review our employment practices regularly,
and in so doing, ensure a culture of renewal, growth and reward
for high performing individuals.
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Members
of Old Mutual’s employment equity forum. |
We believe that the efforts of employees that co-create the success
of the company should be appropriately acknowledged. Our pay systems
are structured to recognise both the contribution of individuals,
and the performance of the business in which they work.
The training and development of all employees, including directors,
remains a priority. In this regard, the Old Mutual Business School
provides a holistic learning experience that is aligned with core
competencies, business objectives and company strategy.
Employee representatives are consulted regularly on issues affecting
employee interests. The company values employee involvement and strives
to keep staff informed on all aspects of the business. Communication
vehicles include in-house publications, briefings, road shows, the
Intranet and email.
WORKPLACE CULTURE
During 2001, under a new leadership team, Old Mutual focused on establishing
a value-driven culture now called “Siyakhula, the Old Mutual
Way”. All employees in South Africa were engaged in co-creating
a set of values that govern Old Mutual’s relationship with its
customers, shareholders and the broader South African community. The
company values — integrity, commitment, passion and growth —
also shape the internal climate for employees.
During 2002, expression was given to these values in a number of ways.
Several new employee community participation initiatives were launched,
and these are referred to in other sections of this report. Priority
was given to a new customer service culture and the customer services
division already embodies the values in the service we give to our
customers.
Through judicious financial management and the application of strict
governances, Old Mutual’s value of integrity is demonstrated
in its relationship with its shareholders and the broader business
community.
Several workplace programmes were launched during the year for employees.
An emphasis on respect for diversity and performance management, and
the establishment of the Old Mutual Business School, are some of the
initiatives that give expression to our values and vision.
EMPLOYMENT EQUITY AND DIVERSITY
In 2000, OMSA submitted its first employment equity (EE) report to
the Department of Labour. Since then, and particularly in 2001, we
have made strong headway with the implementation of our EE strategy.
This is demonstrated by the appointment of eight black and four female
employees in top management. Roughly 40% of OMSA’s operating
profits are now under the direct control of black executives.
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OLD MUTUAL EMPLOYMENT EQUITY PROFILE
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| TOTAL
EMPLOYEES |
| 2002 |
2001 |
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| BLACK |
Executive
management
Senior management
Total staff |
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43
178
13 392 |
47
164
13 751 |
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| FEMALE |
Executive
management
Senior management
Total staff |
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43
178
13 392 |
47
164
13 751 |
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| DISABLED |
Executive
management
Senior management
Total staff |
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43
178
13 392 |
47
164
13 751 |
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Despite
the progress achieved, we have a long way to go in some sectors, especially
with regard to the number of black people in the management and professional
skills categories.
A key challenge is to grow actuarial and accounting skills amongst
black people as well as women. We have specific programmes in place
to develop these skills (see page 49).
We are also developing an aggressive retention strategy for key employees
aimed at achieving a critical mass of black and female managers in
senior grades. In support of this strategy, we are developing a programme
for Women in Leadership.
Several factors have contributed to the accomplishment of EE goals
in 2002. In particular, the active roles played by the managing director
and deputy managing directors were crucial to the success of EE initiatives.
Placing accountability for EE in business units and linking EE objectives
to management bonuses have also been effective initiatives.
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Diversity
training programmes designed to create awareness of the value of a
diverse workforce have supported implementation of EE. Other diversity
initiatives included Diversity Day celebrations, Disability Day activities,
EE networking breakfasts and a focus on women in management.
Disability strategy
Old Mutual became the first South African corporate to launch a Strategy
on Disability in the Workplace to coincide with the International
Day for the Disabled on 3 December 2002.
This year we will increase our focus on people with disabilities in
terms of facilities, recruitment, assessment, skills development, employment
practices, and corporate social responsibility.
The percentage of employees with disabilities has grown from 1.2%
in 2000 to 1.6% in 2002. Our aim is to increase that number and we
are working with other organisations and the Department of Labour
to share knowledge and experience. |
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HIV/AIDS
WORKPLACE PROGRAMME
In support of HIV/AIDS policy, Old Mutual has a comprehensive
HIV/AIDS Workplace Intervention Programme. The programme aims
to limit the spread of HIV/AIDS and to assist those employees
who are HIV-positive with effective disease management.
Employees are never required to disclose their HIV status. Consequently,
this is not a factor in determining employment, career or development
opportunities.
HIV/AIDS education, care and support are offered to all employees
in an environment where staff can participate without fear of
discrimination or stigmatisation.
| 2002
HIV/AIDS workplace interventions included: |
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HIV
Seroprevalence Assessment: Old Mutual undertook a proactive
business risk assessment of the possible impact that the
HIV/AIDS pandemic holds for our company over the next
five years. 67% of employees from around the country participated
in this voluntary assessment that delivered a 5% HIV-positive
result. The indication that, statistically, one in 20
of our staff across the country was HIV-positive at the
time of the assessment had a powerful effect in creating
greater HIV/AIDS awareness among Old Mutual staff.
According
to Professor Rob Dorrington from the University of Cape
Town (UCT) and Convenor of the Aids Committee of the Actuarial
Society of South Africa, this result is consistent with
expectations for the financial services sector, based
on modelling done by the Centre for Actuarial Research
at UCT. The assessment results have provided valuable
information that can be used to ensure that our human
resources practices and policies, and HIV/AIDS programmes
remain relevant and responsive. |
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“Know
Your Status” Campaign: While the results of the Seroprevalence
Assessment were important for our business, Old Mutual, as a
leader in dealing with HIV/AIDS, also recognises the importance
of individuals knowing their HIV status. All employees were
therefore offered voluntary free, confidential HIV testing as
well as pre- and post-test counselling through an independent
service provider. |
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Education
Programme for Staff: This ongoing programme for all employees
deals with managing HIV/AIDS in the workplace, provides facts
and figures on HIV/AIDS in South Africa, and helps with personal
risk assessment. Workshops, attended by approximately 6 000
employees, were held countrywide in 2002. |
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National
Peer Education Programme: This programme has been introduced
to equip volunteer employees to support their fellow workers
in dealing with HIV/AIDS-related issues. The Peer Education
Programme also provides employees with an additional resource
for information and education regarding available facilities,
programmes as well as workplace policies and practices surrounding
HIV/AIDS. In November 2002, Old Mutual’s first group of
volunteer peer educators successfully completed the training
programme. |
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A
Youth Workshop on HIV/AIDS was held for children of Old Mutual
employees. Issues such as HIV transmission and prevention, social
issues including discrimination, and the stigma associated with
the disease, were addressed in a fun learning environment. |
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HIV/AIDS
Disease Management Programme: The Disease Management Programme
was developed by Old Mutual Healthcare to support and educate
members, to assist them in managing their medical aid benefits
optimally, and to contain the increased medical costs resulting
from the treatment of HIV/AIDS. It also provides access to complete
disease management, including antiretroviral treatment when
medically advised. Employees and their dependants who are members
of the Old Mutual Staff Medical Aid Fund, as well as all Old
Mutual’s service staff and their dependants, have access
to this programme.
The clinical management component of the
programme aims to optimise member benefits through the most
appropriate treatment and drug therapies. Treatment is based
on the Old Mutual Healthcare Treatment Protocol that was designed
for South Africa, taking affordability and local conditions
into account. |
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EMPLOYEE
WELLBEING
Old Mutual’s Employee Wellbeing Programme (EWP) continues to
provide a valuable confidential, professional counselling and support
service to employees and their household dependants on a wide variety
of personal issues.
The programme is run in conjunction with the Centre for Human Development.
Employees have access to a 24-hour national call centre and counselling
is also offered on site at Old Mutual’s head office. During
2002, an email facility was introduced as an alternate means of contacting
the service. The largest percentage of EWP users is in the 31 to 40
age group and typically represents middle to senior management.
The benefits of the EWP can be seen in the steady decline in medical
aid claims for psychotherapy and social work consultation services
submitted to the Old Mutual Staff Medical Aid Fund. In addition, there
has been a significant decline in new disability claims stemming from
psychiatric and social problems, indicating that intervention programmes,
such as the EWP, are having the desired effect.
The intention for 2003 is to widen the focus of the EWP to include
more holistic health and lifestyle management and, in particular,
a stress management programme.
TRAINING AND DEVELOPMENT
Old Mutual is committed to the growth of all our employees. We provide
opportunities for training and development in a variety of skills
including job-specific skills, and leadership and personal development.
During the year under review, R89 million was spent on training, representing
6.7% of payroll. Training of black employees equated to 3.4% of total
payroll.
The Department of Labour has selected Old Mutual as a pilot site for
the South African Investors in People standard. The government launched
this initiative in conjunction with the European Union with the aim
of setting basic national skills development standards by March 2005.
The national standard is intended to promote people development within
organisations and Old Mutual is currently developing the Investors
in People process over a three-year period in line with our Group
Learning Strategy.
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| In
2002, Old Mutual was assessed according to a set of standard
Investors in People indicators. In this assessment Old Mutual
met six of the twelve indicators. Our key strengths included: |
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top
management’s genuine support for people development |
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the
desire to transform the culture of the organisation through
Siyakhula |
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the
success of the company’s first Diversity Day |
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the
investment in training and development through the establishment
of OMBUS |
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support
for external qualifications |
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performance
contracts, personal development plans and performance appraisals
for all staff |
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mechanisms
that recognise and reward excellent performance |
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commitment
to continuous improvement. |
The indicators that were not met provide us with valuable insight
for planning and focusing our training and development initiatives
for 2003.
Old Mutual is also committed to the national imperative of skills
development and has been accredited as a provider of learning by the
Insurance Sector Qualification Authority (INSQA). This is a crucial
milestone in the process of implementing skills development within
Old Mutual. We are one of the first eight providers who have been
accredited in the insurance sector.
Specific training programmes are in place to grow actuarial and accounting
skills amongst black people and all women.
These are the Actuarial Transformation Programme (termed the “actuary
factory”) and the Training Outside Public Practice Programme
(TOPP) involved in the training and accreditation of chartered accountants.
The actuary factory provides bursaries to highly numerate grade 12
learners and supports them through university. We currently have 20
employment equity (EE) bursars and will reach a total of 28 this year.
TOPP has eight candidates and seven bursars, all of whom are EE employees.
OMAM has also launched an actuarial and accounting bursary fund that
provides financial support to black employees and external bursaries
to black students.
Old Mutual Business School
The Old Mutual Business School (OMBUS) is the primary entity through
which learning occurs in Old Mutual. Established to promote a learning
culture, OMBUS commenced operation in February 2001. In 2002, over
6 400 employees were trained through OMBUS.
This represents almost 11 000 days of learning delivered to the organisation.
A “Blended Learning” approach has been adopted, combining
e-learning, short courses, group projects and interactive workshops.
The first e-learning modules have been piloted and will be rolled
out as part of providing an extensive e-learning platform throughout
the business.
A key focus of OMBUS is the accreditation of Leadership Programmes
that are run in conjunction with the University of Cape Town’s
Graduate School of Business. An internationally recognised OMBUS MBA
programme is envisioned, as well as the provision of the Leadership
Programmes to Old Mutual companies around the world.
Construction of the OMBUS West Campus is complete and training has
commenced in the facility that includes state-of-the-art classrooms,
lecture theatres and e-Learning facilities, as well as catering and
gym facilities.
REMUNERATION AND BENEFITS
Old Mutual South Africa strives to offer remuneration packages that
attract, retain and motivate high calibre employees.
As part of this approach, remuneration is managed on a “total
package — cost to company” basis that enables employee
flexibility and choice. This involves making tax-efficient and legislatively
compliant remuneration options available to maximise the value of
packages paid to our staff.
Base salaries for all employees are at market competitive levels and,
increasingly, earnings growth beyond these levels is delivered through
various incentive arrangements.
The remuneration structures adopted by businesses within the company
support their respective strategies. These, together with the total
remuneration expense are factored into their business plans.
Incentives
Short term incentive plans support a culture of value-based management.
They reward individual, team and business unit performance and are
designed to motivate employees to enhance business results. All incentive
payments are subject to the scheme being registered with Human Resources
and audited by Group Internal Audit.
Our short term incentives continue to evolve in line with improved
measures. This applies especially to “line of sight” allowing
individuals to see the link between their performance, business results,
and reward.
In 2002, differentiation at individual performance level was introduced
to a number of business unit schemes, all governed by a generic framework.
Based on performance assessment ratings, top performers participating
within these schemes qualify for a larger multiple of awarded bonuses.
In line with our philosophy of pay for performance, we expect the
trend towards individual differentiation to continue in the current
year.
Long term incentives are delivered through the Old Mutual plc Group
Share Incentive Scheme. During 2002, for the first time, certain categories
of sales staff and middle management received a special award under
the scheme based on their achievement of high levels of individual
performance. This inclusion of exceptional performers had the effect
of doubling the membership of the scheme.
Staff benefits
Old Mutual introduced a number of key enhancements to staff benefits
during 2002.
Medical Aid
The Board of Trustees of the Old Mutual Staff Medical Aid Fund considered
members’ differing needs when introducing one medical aid plan
inclusive of four options. These flexible options provide different
levels of day-to-day benefits to best suit members’ needs. In
addition, the major medical benefit, providing primarily hospital
care, was increased from R300 000 to R400 000.
Two management care programmes were introduced to provide additional
support to members and their dependants in need of these benefits:
A Mother and Baby Care Programme educates and supports mothers during
pregnancy, at birth and after birth.
The Oncology Benefit Management Programme assesses the oncology treatment
plan in close consultation with the treating specialist in order to
assist members.
The distribution of chronic medication was enhanced by including deliveries
to local ScriptNet pharmacies. This member-friendly distribution method
allows for face-to-face counselling and healthcare advice on collection
of medication.
Life Assurance Benefit
All members who joined the Old Mutual Staff Retirement Fund from 1
April 2002 automatically qualify for the benefit of a core level of
life assurance cover, irrespective of their health status. Medical
testing is therefore no longer a requirement for acceptance of core
cover.
This benefit currently amounts to 2.4 times the member’s annual
pensionable earnings and members may voluntarily apply for additional
life assurance cover, subject to medical testing and acceptance by
the underwriter.
As a result of the positive claims experience in respect of employees
who became members of the fund prior to April last year, the Management
Board decided to temporarily reduce Old Mutual’s contribution
towards the provision of the Life Assurance Benefit. The reduction
means that those members now receive an additional employer contribution
towards their retirement funding.
Unemployment Insurance Fund
The most significant change to employment practices during the year
under review followed the introduction of the new Unemployment Insurance
Contributions Act on 1 April 2002. Under the new legislation, all
employees are required to contribute to the Unemployment Insurance
Fund, irrespective of their level of earnings.
Contributions are calculated at 2% of the staff member’s remuneration,
capped at R8 099. Employees contribute 1% from their monthly remuneration,
whilst the other 1% is paid by Old Mutual.
The new Act also introduces a variable unemployment benefit scale,
dependent on remuneration and length of service. The duration and
scale of the maternity benefit has also changed. |
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INDUSTRIAL
RELATIONS
In managing its relationship with employees, Old Mutual complies with
applicable employment legislation and the labour standards, recommendations
and conventions of the International Labour Organisation, as ratified
by South Africa.
In August 2002, substantial amendments to the Labour Relations Act
and the Basic Conditions of Employment Act were enacted. These amendments
have important implications for industrial relations in Old Mutual.
During the year under review, Old Mutual had files on 80 industrial
relations related disputes. These involved labour disputes in the
CCMA and Labour Court. Approximately 37 have been finalised and Old
Mutual was ruled against in only three of these disputes. |
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TRADE
UNIONS
As at 31 December 2002, 40% of our staff belonged to a trade
union compared with 39% in 2001. The breakdown was as follows:
| Trade
union representation as at December 2002 |
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Membership |
%
of total office staff (10 707) |
| OMREB |
3
905 |
36 |
| SACCAWU |
231 |
2.1 |
| SATAWU |
113 |
1.1 |
| BIFAWU |
76 |
0.7 |
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Old Mutual works constructively with trade unions and, in the case
of the Old Mutual Representative Employee Body [OMREB, part of the
Insurance Banking Trade Union of South Africa (IBSA)], management
meets regularly to discuss matters of mutual interest through a non-statutory
workplace forum.
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JOB
CREATION
During 2002, Old Mutual was a net creator of 104 new jobs, despite
363 retrenchments and normal attrition.
We are mindful of the potential impact of retrenchment on the lives
of affected employees, and always strive to find alternatives as far
as practically possible. As a result, we endeavour to reduce retrenchments
by re-deploying staff to alternative positions within the company.
Where retrenchment is unavoidable, we provide guidance and counselling
on career changes and pay double the statutory requirement of one
week’s severance pay for each year worked.
EMPLOYEE SATISFACTION
Old Mutual participated in the Best Company to Work For survey run
by Deloitte & Touche Human Capital Corporation. An increasing
number of companies have taken part in this survey since its inception
3 years ago and, in 2002, Old Mutual rated 45th out of 85 companies
surveyed.
The survey incorporates 10 separate dimensions relating to human capital
practices. These are: job satisfaction, leadership/ management style,
relationships and trust, communication, training and development,
rewards/recognition/performance, policies and procedures, change management,
diversity, management information. Old Mutual welcomes the survey
feedback, challenging us to build on and better each year’s
results. |
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