Management Report on Company Business
Activities and Assets

PERSONNEL AND SOCIAL POLICIES

The main goal of personnel and social policies is to achieve competitive financial results while ensuring general employee satisfaction. This is particularly important in a situation where it has been necessary to continue essential measures eliminating anticipated adverse impacts of a fall in demand on the coal market. Our solid wage and social standards, fairness in employer- employee relations, ongoing communication with trade unions, and sound level of collective bargaining combine to boost the decent social climate within the Company.

Work force size and coal extraction

Productivity and monthly wages

Employee age structure (%)

Employee process structure (%)


	under 25 years	3.2

	25 – 35 years	20.9

	35 – 45 years	25.6

	45 – 55 years	39.4

	over 55 years	10.9


	Overburden	23.6

	Coal extraction and preparation	41.4

	Maintenance and other servicing processes	22.8

	Administration	12.2

Employee education structure (%)


	Primary	16.1

	Vocational	58.7

	Secondary	21.5

	University	3.7

Number of Employees

The number of employees at year-end stood at 5,402, i.e. 260 down on 2000. The average number of employees fell year-on-year by 290 to 5,510 employees. This process is the result of ongoing rationalization and restructuring measures in the scope of a programme preparing the Company for the impact of the full operation of Temelín Nuclear Power Station. Although the workforce was streamlined, there was year-on-year growth in the volume of coal extracted and sold.

Wages and Labour Productivity

Labour productivity expressed in terms of value added per employee and per month rose 17.2% to CZK 72,987. The average monthly wage at the Company rose 7% and amounted to CZK 16,438. This growth, which was 2.5 times lower than the growth in labour productivity, was achieved primarily by a 5% rise in base wages in accordance with the Collective Agreement and by an increase in the additional pay cheque based on the good results reached in the fulfilment of the business plan. Wage costs rose just 2.3% year-on-year, thanks to the cut in the number of employees; this rise was fuelled by the increased volume of redundancy pay.

Benefits Programme

The Company's benefits programme complied with all applicable law and, traditionally, obligations stemming from the Collective Agreement. These obligations mainly focused on works catering, supplementary pension schemes, and sponsorship of the cultural, sports, and health activities of current and former employees (pensioners). A total of CZK 19.8 million was drawn from the social fund, or an average of CZK 3,435 per employee (not including returnable loans).

Education Programme