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Cannington Remuneration Policy Investigation. The
organisation studied for the purpose of this
investigation is Broken Hill Proprietary / Limited
(B.H.P.). B.H.P. is Australias largest company and
was ranked 125th on the fortune global 500 list of
the worlds largest industrial companies in 1993.
The company was incorporated in 1885 and began
mining silver , lead and zinc at Broken Hill in
NSW Cannington is BHPs latest mine which is still
yet to officially open, the mine was a Greenfield
site discovered in June 1990. BHP is currently
evaluating a world class silver lead and zinc
deposit located in Cannington near McKinlay, North
Queensland The company currently hold a mining
permit for 7660 hectares in the area, it is
estimated to be the largest silver mine in the
world. The general context of the policy is
focused on the change of attitude between
management and staff on the Cannington site and
the out come of the specific remuneration policy
will hopefully be to attract and retain a good
team of employees in order to recognise the value
of the BHP workers and to extract maximum wealth
from Cannington silver, lead and zinc deposits.

By
undertaking this investigation I hope to achieve a
better understanding of the remuneration policy
and how and why the policy was changed in the
beginning of the Cannington project. I will also
hope to achieve an understanding of future
direction. To complete this investigation I will
use information about the previous and current
remuneration policies related to previous projects
completed by BHP. I will also investigate, the
pressures involved to inspire the Human Resource
Management Department to change the policy, the
new policy, and the desired effect the change is
designed to have on the current mining site. I
will also explain the effect the remuneration
policy will have on structures and the effect it
will have on activities of the business as well as
the evaluation process used by the management to
ensure that these policies are working. I have
obtained this information from a lecture given by
Glenn Morrow the manager of the Human Resource
(H.R.M.)Dept.

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at BHP. Mr Morrow gave a speech on
the organisation in which I am investigating and
also on the Cannington site in particular . He
achieved this by using overhead transparencies
showing the objectives of the Cannington site, we
were also given a copy of all of the overhead
transparencies in the form of a booklet. The
specific human resource management policy prior to
change was effective in order for past projects,
but Cannington is different to all previous sites
such as BHP Manganese, BHP Iron Ore and BHP
Australian Coal which were all examined and were
not approved because these previous policies were
based on people living close to the workplace. The
second major reason these previous policies were
not approved is because in the case of Cannington
B.H.P is the provider of transport, social
recreation, and all meals because Cannington has
no local community as it is five hundred kms from
the nearest town. The old policy states that there
is a base pay, site allowances depending on the
danger in the particular environment and for the
inconvenience of being away from home, shift
allowances for evening and night shift workers.
Bonuses for meeting deadlines such as monetary and
leave aiding, and annual leave pay outs vary
depending the value of the employee these bonuses
for a valued member of staff can include transport
and accommodation paid holidays for contractors as
well as officials and families of these people.
Management perspectives on pressure for change in
the Human resource management policy include.

All
established remuneration policies are based on
people living close to their work place. All of
the workers live at least five hundred kilometres
away from Cannington therefore it is impossible
for workers to rely on personal transport to
arrive at work promptly in the early hours of the
morning to start work. In response to the pressure
B.H.P. has supplied a twenty seater plane for
transportation to assist in the commuter “Fly In
Fly Out” operation, which is free of charge to
employees, on condition of this is that all
workers must work for fourteen days whilst working
twelve hour shifts in a twenty four hour mine and
living on the Cannington site before being flown
back to Townsville. The employees will live in the
companies newly built motel style bed sitter
apartments which are located five hundred to one
thousand meters from the under ground mine. At the
end of the fourteenth day the workers return home
for seven days break before the next shift begins
and the same procedures take place.

Meals are
supplied daily in a common dining room B.H.P.
ensures that employees will be as comfortable as
possible and taken care of . Another pressure
involved is remoteness, workers wanted stability
in their wage and BHP wanted to attract the best
so annual pay is offered to employees, this makes
situations such as self-sufficiency for employees
and the families of employees possible, it also
motivates workers to stay on the work force
because it is an aim of B.H.P. to promote flexible
and multi skilled employees who are in the long
term valued as an asset to the company, the
employees that are multi skilled are also eligible
to higher pay according to specific
qualifications. Multiskilling is important for all
organisations because if for any reason staff is
short their would be a loss in productivity and
costs of re-hiring when interviewing takes place.
Team pay will also be implemented for team ideas,
team solutions, routine and rise in production.
The evaluation of the comprehensiveness of the
policy takes into account the polices impact on
other areas of the human resource management
policy within the organisation, such as
Occupational Health and Safety. The Occupational
Health and Safety policy states that every six
months all employees must stand a blood test to
ensure that he or she is not being over exposed to
lead or any other toxins in the air. If the
employee is proved to being over exposed they will
be classified as being unfit for mining conditions
in the interest of their own health and according
to company standards, the employee who is over
exposed will be redeployed or relocated to another
task at the companies expense The evaluation
policy also looks at training .

Training is a
compulsory company objective so that workers are
properly made familiar with any new or updated
equipment or technology and so that miltiskilling
can be enforced in the workplace. By enforcing
multiskilling in the workplace all workers will be
more aware of their surroundings and in term more
responsible for their designated areas of labour.
The hiring policy has also been evaluated in the
sense that BHP will from now on only require
people with practical experience not just
qualifications in the field, these employees that
are recruited will be paid accordingly to their
practical experience. This will ensure that
multiskilling becomes an easier part of training
and will in term increase productivity and the
effectiveness and punctuality of the tasks in hand
and this is reflected in the remuneration policy.
A specific area of change to the remuneration
policy includes the Activity structure which
includes facilities for employees, such as a
twenty five meter Swimming Pool, Volleyball Court,
six hole Golf course and Cable TV The site is also
equipped with Bed sitter style apartments and a
dining and meals area with a separate wet area
where alcohol is provided in moderation.. This is
only what has been built so far, actual use of the
mine by employees in mid October will determine
what other facilities are to come. As result to
the on-site contracts given to employees there is
a change in structure, B.H.P. will provide a
counselling service to deal with stressed
employees and also to deal with the families of
employees who are struggling with out their
spouses.

This service will be beneficial if it is
necessary and the service will be free of charge.
Another change in structure includes that BHP has
included a Transport Co-Ordinate to their staff
list, this person will ensure the Fly In Fly Out
program runs according to plan. The response of
the remuneration policy for the Cannington site
has uncovered that the policy is expected to be
highly successful in its new areas. The employee
survey (will be distributed every six months). BHP
prides its self on its three main goals
Attraction- the ability to grow and use skills to
achieve a high outcome, Retention- the ability to
retain employees for the welfare of the employee
and interim the welfare of the organisation, if
BHP is able to retain at least ninety five percent
of their employees this area of the policy will
also prove the policy successful ; and Motivation-
the individuals understanding of the organisation
and their contribution to team work. The policy
response will also take note in the future of the
productivity rate of the steel being mined. The
results will be compared to the average figures
and figures compared with competitors.

If the
policy is effective it should show a higher
productivity rate compared to the competitors, if
the policy is not working the productivity is
expected to be at or below average. If the
productivity rate reduces by over five percent the
policy will be a failure, in this case BHP will
ensure that employees in the area of fault will be
required to attend extra training and the policy
will be reviewed thoroughly. If the policy is
taking effect and the majority of people are happy
this will be clear because the Unions will not
have much to say. Due to the change of the
remuneration policy, people will work as part of
the body of the organisation, the employees will
determine what the site is lacking and what has to
be evaluated, they will be given this opportunity
with evaluation surveys which will be distributed
and carefully evaluated and considered once
returned, these surveys will consider work,
recreation and living necessities. The experience
and the evaluation of surveys will benefit in the
long run as the structure of the Cannington site
will improve in productivity and living standards.
The plans on the site can also possibly be used as
a model for future projects. The evaluation is
expected to be successful because suggestions and
opinions are in writing and not just word of mouth
they are better recognised.

As result of these
surveys employees and their families can feel more
stable knowing that their problems have been
addressed formally by the management team. If
ninety five percent of the employees return a
positive opinion (as expected) this will indicate
job satisfaction and the policy a success. At the
moment BHP maintains a fast growing production
rate, and expects to keep on doing so. In the
future I believe the changes will be made in the
area of rewards. Rewards will be offered to those
who perform at a worthy standard and for lengths
of service for the organisation. Annual welfare
should also be offered to those who perform above
this company standard.

In the future BHP will at
some stage have to introduce rewards and bonuses
for targets met in the productivity and production
line these rewards and bonuses could include
annual airfares or other rewards. If these
introductions do come in to action, BHP will need
to employ more staff as the mine expands. In every
organisation there is room for improvement, and
BHP is no exception to this. I believe that the
likely future responses to the current
Remuneration policy will indicate that the policy
is one of well being and will indicate a positive
direction in recruiting employees and the position
BHP holds on the rich list. Bibliography:.

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