S – Social Responsibility

Observance of Human Rights and Social Assistance

Social Stability

The Company strictly complies with the requirements and does not violate the RoK labour law, which states that no one may be subjected to any discrimination in exercise of their labour rights on the grounds of origin, social, official status and material position, gender, race, nationality, language, religious beliefs, convictions, place of residence, age, physical disability or affiliation with public associations. No facts of discrimination were recorded during the reporting period.

We do not use child labour or forced labour, we acknowledge the equal rights of all employees, irrespective of their race, religion and gender.

Each employee of the Company has equal opportunities in exercising their labour rights and freedoms. Moreover, the Company is actively engaged in negotiations with employees for signing or amending the collective bargaining agreement, strictly observes the time limits for negotiations and ensures functioning of appropriatecommissions, provides information necessary to conduct negotiations, strictly fulfils the conditions of the collective bargaining agreement.

In accordance with the labour law, any employee has the right to participate through their representatives in collective negotiations and drafting of the collective bargaining agreement as well as to review the signed collective bargaining agreement.

The Company’s activities impose no restrictions on the rights to freedom of association or collective bargaining by types of activities or on territorial basis. Being a socially responsible company, we fully support this right and create a favourable environment for exercise of employees’ rights to freedom of association.

For the purpose of unification, we have developed a model collective bargaining agreement that establishes the uniform principles of remuneration, social assistance, working conditions, rest and work hours, etc. The model collective bargaining agreement sets forth a step-wise algorithm for solving collective labour disputes, if they arise. Model requirements for collective bargaining agreements within KMG Group enable building labour relations on the legal basis, preventing improper increase or decrease in employee benefits, recommending consistent actions in case of labour disputes in order to prevent conflicts and relieve tension.

In order to maintain social stability in the workforce of KMG Group companies, the Company implements a set of measures aimed at preventing discontent and tension among employees of SDEs. The taken measures allow companies to control the situation and maintain business continuity.

For example, social assistance to employees contributes significantly to maintaining the social stability of workforce.

Currently, 24 production companies14 of KMG Group have collective agreements in place. In 2021, the number of KMG Group employees covered by collective agreements was around 43,00015 (56,066 in 2020, 58,710 in 2019) (excluding KTG and its SDEs).

All collective agreements of KMG’s companies provide for more than 35 forms of social assistance for employees and their family members as well as retirees.

Benefits Package

KMG provides its employees with guaranteed social package that includes various types of social allowances, securities and compensations: material assistance for health improvement to annual leave, maternity benefits, monthly payments to employees on leave for childcare until children reach the age of 1.5, compensation for termination of employment in case of impossibility to transfer to another job, due to full loss of capacity, disability, one-time payment in case of death of the employee for funeral, one-time payment to the family of the employee who died as a result of a job-related accident. The Company also provides social securities for voluntary medical insurance in case of illness and organisation of rest for employees’ children in children’s health camps in Kazakhstan.

In addition, the employees may be provided with additional types of social assistance. These forms of social assistance are set forth in collective bargaining agreements or internal regulatory documents of the enterprise. Such payments include payments for the anniversary date, retirement age, marriage, short-term leave in case of marriage, childbirth, death of relatives, for medical care and surgeries in case the costs exceed the insurance limit, benefits for disabled children of employees, benefits for employees in desperate need, school supplies for the first of September, assistance to employees in desperate need, etc.

In 2021, KMG Group retained all social benefits and securities and paid in accordance with collective agreements. Overall, in 2021, the social assistance to the employees and retirees was provided for the amount of over 22 bln tenge. There are no plans to reduce the amount of social assistance to employees this year.

In case of any change in the working conditions, the Company notifies the employee in writing at least fifteen calendar days in advance. The minimum period of notification about considerable changes in the Company’s operations is 4 weeks.

KMG places special emphasis on implementation of internal socially-oriented programmes. In promoting them, the emphasis is primarily placed on creating a favourable environment for the Company’s employees. These are measures of material inducement, retention and professional development, and ensuring workplace safety. The prevention of social tensions, labour disputes and conflicts is a particular area of focus.

Internal Communications

There is constant and constructive communication with employees and their representatives. A unified internal communication system is designed to improve efficiency of feedback. All facilities hold mandatory scheduled meetings between management and employees to discuss social, domestic, work issues.

The key objective of the internal communication system is to inform employees in a timely manner about the goals and objectives of operations, to communicate the current situation in the company to employees, and to “hear” the issues raised by employees.

Main internal communication tools are the performance assessment meeting of the CEO with employees, meetings of the management with trade unions, personal meetings of employees with the CEO, etc.

One important factor in the social wellbeing of employees, in addition to remuneration and social assistance, is working environment, including social and welfare conditions. Field workers, especially those working on a rotational basis, are offered decent living conditions, sanitary facilities, canteens, recreation, leisure, and sports areas.

In addition, the Social Engagement and Communications Centre of Samruk-Kazyna JSC conducted its annual Social Stability Index (SSI) measurement in 2021. According to ongoing social stability surveys, the Company’s integral social stability index for 2021 was 79 percent.

Based on the survey, the Action Plans will be developed for each company to minimise and eliminate all areas of concern identified in the Social Stability Index measurement, which cover the identified problems in the company that affect the social wellbeing of employees (internal communications, food quality, living conditions, provision of personal protective equipment, training, career development, etc.).

An engagement and satisfaction survey was also conducted in 2021 among the administrative and managerial personnel of KMG Corporate Centre, which amounted to 83% for the reporting period (2020 – 81%, 2019 – 62%).

All KMG’s production companies allow each employee to address questions to the company’s management and receive a timely response by introducing internal communication tools, according to which the systematic biannual performance assessment meeting are held between CEOs and employees and meetings between managers and the trade union.

In 2021, performance assessment meetings of CEOs with employees were held online due to the epidemiological situation in the country.

In addition, in order to create and maintain effective channels of direct communication between employers and employees in SDEs, to inform employees in a timely manner about goals and objectives of operations in SDEs, to communicate the current situation in the company to employees, to create a positive image of the company among employees, to monitor the social and psychological climate among the workforce, the SDE CEOs receive employees on personal matters, each SDE has a CEO blog and a corporate information board, corporate information website, displays for video announcements are installed to communicate internal corporate information to employees. Information stands are used to bring prompt announcements and messages to the notice of employees.

Meetings are held between the management and SDE trade union on a quarterly basis to address the most pressing issues concerning the implementation of the collective agreement, labour discipline, handling of employees’ appeals, health and safety issues, social benefits and compensation and other socially important issues in the company.

Trade Unions

The Company interacts with trade unions as part of the social partnership established by the labour law at the industrial and regional levels. At the industrial level, the main interaction parameters (social securities, labour organisation, principles of remuneration, employment, gender and youth policy, occupational health and safety, prevention and resolution of labour conflicts, etc.) are set forth in the Sectoral Agreement in Oil & Gas, Oil Refining and Petrochemical Industries of Kazakhstan for 2020-2022, which was developed with active involvement of representatives of KMG and its companies.

KMG Group has 28 trade union committees including local trade unions that protect the interests of over 35 thousand employees (excluding KTG and its SDEs).

At the regional level, the regional committees for social partnership operate, which, apart from regional employment and occupational health issues, deal with specific collective labour disputes. All KMG companies have conciliatory committees in place.

KMG’s Health Management Programme

The Personnel Health Management Strategic Initiative is part of the strategic goal of Sustainable Development and Gradual Reduction in Carbon Intensity of Operations of 2022-2031 Development Strategy of JSC NC “KazMunayGas”.

In 2021-2022, nine SDEs of JSC NC “KazMunayGas” (KGM, EMG, AR, KTO, KTM, KOA, OMG, MMG, KBM) diagnosed the health management processes for voluntary health insurance/service and industrial medicine.

As a result, a draft concept of KMG’s Health Management Programme was developed with initiatives focusing on three main areas:

  • dealing with the pandemic and its aftermath;
  • preventing occupational diseases;
  • raising employee awareness and motivation for a healthy lifestyle through the use of digital tools.

The purpose of the Concept is to create a transparent health management process in KMG Group and to improve the medical and preventive care system (preservation, promotion and improvement of health).

Key objectives of KMG Health Management Programme to be developed by the Company in 2022-2023 as part of Health and Industrial Medicine Standards:

  • Optimize pandemic control and pandemic response measures in accordance with existing regulations and work specifics of the Company’s group;
  • Reduce the risk of occupational diseases by introducing an effective healthcare system for employees of the Group with an integrated approach and using all the possibilities of the healthcare services provided by the RoK;
  • Develop mechanisms to strengthen the involvement and motivation of the Company’s employees to lead healthy lifestyles.