Employment

In this section:

Summary Respect in the Work Place

Total workforce by employment type, employment contract, and region, broken down by gender.

Total number and rate of new employee hires and employee turnover by age group, gender, and region.

Composition of governance bodies and breakdown of employees per employee category according to gender, age group, minority group membership, and other indicators of diversity.

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Summary

In 2013 the CNCO Group employed 1,437 people, split between seastaff on our ships (872) and shore staff (565). Out of the total shore staff, 51 were based in shipyards supervising our large programme of ship newbuildings and 514 positions were based in our four significant employment locations: Singapore (Head Office) – 29.91%, Australia – 19.47% and New Zealand –14.87% and PNG – 22.48%.

This is an increase of 31.54% over 2012 (in those four locations) and reflects establishment of CNCo office in PNG and growing the number of employees across Swire Shipping and Swire Bulk Divisions in their locations.

Of the onshore employees, 48.5% were male (from 54.0% in 2012) and 51.5 were female (from 46.0% in 2012). However at the management level by the end of 2013, 72.9% were male (from 77.6% in 2012) and 27.1% female (from 22.4%), a welcome move of 9.4% towards more equal female representation. Also at the support staff level the gender disparity has decreased further by 4.6% with males dropping to 36.3% (from 38.6%) and females increasing to 63.7% (from 61.4%) from 2012 levels.

During the recruitment process we always stress CNCo’s commitment to being an equal opportunities employer. We welcome diversity in the workplace, believing that it adds material value to an organisation by helping workers to approach their jobs from different perspectives. All our offices are significantly, and happily, multicultural and the nature of working with different parties around the world adds another positive dimension to the cross-cultural working environment.

When seeking new employees, CNCo has discussions both internally and with any external placement consultants to ensure that Persons With Disability (PWD) with the skill set matching our requirements are included in the process.


Respect in the Workplace

CNCo is committed to providing an inclusive work culture and appreciates and recognises that all people are unique and valuable and should be respected for their individual abilities.

CNCo will not tolerate harassment or discrimination on the basis of age, cultural background, disability, family status, gender identity, marital status, nationality or ethnic origin, political opinion, race, religion, sexual orientation or social group. Our Corporate Code of Conduct requires all employees to behave with courtesy and respect towards everyone encountered in the course of business.

Only five employees (0.88%) of our shore staff were temporary, as we actively seek to offer and maintain long-term employment. This is a 50% decrease from 2012. The average length of service in New Zealand has decreased slightly year-on-year from 5.29 to 5 years, in Australia from 7.05 to 6.9 years but increased in Singapore from 3.2 to 4.3 years.

Staff turnover or attrition in New Zealand in 2013 was 7.81%. Benchmarking data are hard to find, but New Zealand Government Statistics Office and third-party studies do refer to the country as “a nation of job hoppers” with a common turnover rate of around 14% annually, so this is positive compared to the national figures, but still materially higher than we would ideally like.

In the larger job market of Australia in 2013 the rate was a comparable 6.78%. The local AMMA and ABS statistics on labour mobility for the maritime sector reports an average rate of around 11%, twice the rate of 2010, so in both locations the CNCo attrition rate is a welcome half to two thirds of applicable benchmarks.

Only five employees (0.88%) of our shore staff were temporary, as we actively seek to offer and maintain long-term employment. This is a 50% decrease from 2012.

In Singapore the turnover rate continues to remain high, at 15.12% in 2013. Whilst this is much higher than our other major office locations, it is still lower than the Singapore benchmark rate (the published annualised monthly resignation rate figures for the Administrative and Support Services sector from Singapore Ministry of Manpower) of 16.6% but it is still too high, and efforts are continuing to be made to reduce it through increased alignment, engagement, mentoring, communication and ensuring that our remuneration packages are properly aligned with the relevant sectors and skills of our employees.

In PNG the turnover rate was 12.88%. We were unable to find a reliable and authoritative average local turnover rate against which to benchmark. Further given that CNCo only re-established an office in PNG in 2013 these figures will continue to be monitored in an effort to establish a credible benchmark.

Overall staff retention in 2013 for shore staff was 89.14% and 97% for sea staff (officers). Shore staff retention was slightly below internally set target of >91% and is an on-going area of focus for the company, especially in Singapore (see above). However sea staff retention is much higher than targeted at >90% and is believed to be significantly higher than our peer group. Efforts will be made to benchmark this in the next report.

In particular we recognise that whilst we have an excellent cadre of employees, the physical separation between the onshore support staff and the seagoing operational staff that is peculiar to the shipping industry means that we must spend more time and resources than many other industries in ensuring that we communicate what we are doing and where we are going corporately, and that the communication is a dialogue not a monologue.

To help maintain and enhance these lines of communication between the sea and shore staff across the various countries where we have stakeholders, we continued to use our in-house monthly magazine, “NiuSwire”, to announce any important companywide initiatives and bring everyone closer together through this medium. NiuSwire is sent out to all our offices and sea staff monthly.

In 2013, as a follow up on the Alignment and Engagement (“A&E”) survey conducted in July 2012, the HR team ran a series of focus groups (workshops) in Singapore, Australia and NZ to further understand staff engagement and alignment issues. The results from those workshops were fed into HR strategy for 2014 and served to continuously improve how the company communicates its core strategy and objectives and how all employees have a part to play in reaching these objectives.

Given the wide variety of our nationality and work locations, we do not herein give a detailed breakdown of types of employment contracts or remuneration / pension entitlements as this would a) be of little material value to anyone in a different region, b) not justify the resources required to produce the detail.

Suffice to say, all of our contracts are in accordance with local employment law as a minimum and are blind to gender identity or age, whilst recognising experience and competence/qualifications.

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Worldwide, 93.81% of our staff are classed as “local”, slightly less than in 2013. (“local” is defined as a national or permanent resident in the country of employment). The balance of 6.19% is classed as expatriate. About 13% out of the total number of expatriate staff are parent company managers who are rotated through internal postings to gain wide sectorial experience throughout the group as they progress during their career. The rest are employed as industry experts and have long term careers with the company worldwide.

We employed a total of 530 seafarers to fill positions at sea (does not include 342 seafarers being on leave) as at 31 Dec 2013. This is a significant increase of 27.4% from 2012 (385). This number will continue to increase over the next 2 years as CNCo introduces new vessels to the fleet under its fleet renewal and Bulk division establishment plans.

Out of the total number of seafarers, 305 or 34.98% are from the Philippines, our biggest provider of seafarers, followed closely by 33.03% or 288 are from Peoples’ Republic of China (“PRC”)/ HK and Myanmar and 87 or 9.98% are from PNG, see Table LA 1.1. We seek to run all of our operations to a single “international” standard.

We do not report in which country or region the sea staff (the majority) are working. Due to the trans-border nature of working at sea the geographical distribution is very dynamic and thus would only be a snapshot at a moment in time.

With respect to the ratio of sea staff on permanent / fixed term contracts, we strongly seek to have all sea staff on permanent contracts of employment.

The historic issue of the employment of seafarers (and all other Overseas Filipino Workers (“OFW”) in the Philippines being strictly controlled by the Philippines Overseas Employment Agency “POEA” meant that it was illegal to employ a Filipino seafarer under a direct contract with an overseas company but this has now been resolved as all seafarers employed worldwide are now required to be covered by a Collective Bargaining Agreement post the adoption of Maritime Labour Convention (“MLC”) 2006 convention. We believe this delivers much more security for our seafarers, and in increasing our retention rates will deliver additional value to our bottom line, considering the level of discretionary training that our seafarers undertake.

CNCo employs seafarers from more than eleven different nationalities covering more than five different religious faiths within its global marine operations, involving 24 owned ships plus 4 chartered ships (as at 31 Dec 2013). They currently call at many ports worldwide but are predominantly working within the Asia Pacific region, demarcated by Vladivostok in the north, Port Klang in the west, Lyttleton on New Zealand’s South Island in the south and Vancouver, Canada in the east, with a significant presence in trades to and from Papua New Guinea.

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The China Navigation Company employs seafarers from more than eleven different nationalities covering more than five different religious faiths within its global marine operations, involving 24 owned ships plus 4 chartered ships (as at 31 Dec 2013).