Social partnership in labor relations

Social and labor issues in the Company, Kola MMC and a number of other SDCs are regulated on the basis of collective bargaining agreements. There are a total of 15 such agreements in place in the entities of the Norilsk Nickel Group.

In 2009, the parties of social partnership completely fulfilled their obligations defined by collective bargaining agreements despite the financial and economic turbulence caused by the decline in global nickel prices. Since collective bargaining agreements of OJSC MMC Norilsk Nickel, Kola MMC and some other SDCs had expired, it was decided to renew the agreements for another three years.

The Company and its SDCs have collective bargaining agreement commissions, which act as standing social partnership bodies. In 2009, the Company’s Collective Bargaining Agreement Commission made 11 decisions on key corporate issues and 57 decisions on applications of individual employees. As a result of these decisions, the Company’s policies on benefits available to employees and reimbursement of vacation travel costs were updated; the principles of rewarding employees for good and effective work were described in a more detailed and systematic manner.

The internal corporate communications system is one of the key tools used to strengthen the social partnership within the Company. The purpose of the system is to ensure an effective exchange of information between the management and employees and contribute to maintaining a positive social climate at work.

In April 2009, the Fifth Corporate Regional Forum of the Group’s entities located in the Norilsk Industrial District was held. The development of social and labor relations at the Company’s entities and SDCs in 2008 was discussed, and future objectives were defined.

An integrated network of reception desks on production, social and labor issues has been effectively functioning at the Company’s divisions and SDCs. The network includes the Company’s Central Reception Desk and 20 reception desks at various business units. In 2009, the reception desks reviewed about 15,000 applications submitted by employees. The key issue of concern was the implementation of corporate social programs, primarily programs for resort treatment and health improvement, as well as corporate pension schemes and pension accounting. In the reporting year, 690 meetings between the management and labor collectives attended by more than 20.6 thousand employees were held.

In Kola MMC, the year 2009 saw more active communications of the top management with the staff. The General Director of Kola MMC started to hold meetings with labor collectives and meet individual employees on personal matters on a regular basis. This considerably accelerated the process of identification and resolution of existing issues.