ANNUAL REPORT 2013

Labor relations

Eternit believes that human capital plays a strategic role in its operations. So much so that in recent years it has been recognized locally and nationally as one of the best places to work for. In 2013, the Company and its subsidiaries were included in the following rankings: Best Companies to Work For (Exame and Você S/A magazines), Great Place To Work Latin America, Brazil and Midwest (GPTW), Best Companies in People Management (Valor Carreira), Most Admired HR Departments in Brazil 2013 (Gestão e RH magazine), Top 100 Companies in OHDI (Gestão e RH), Most Respected HR Departments of the Year (HR Academy) and the Human Being Goiás Award (ABRH-GO).

At the end of the period, the Group had 2,383 employees, with all formally registered employees covered by collective bargaining agreements (CLT) and guaranteed the right to free association and collective bargaining. The mechanisms that reinforce this positioning include the Tripartite Agreement (see more in Safe use of chrysotile asbestos). In the year, no incidents were registered that put at risk the legal right of employees to take part in associations. GRI HR5 Global Compact 3

Except in the case of SAMA – where employees transferred to other plants are informed at least 30 days in advance –, the collective bargaining agreements do not establish minimum periods for notification of operating changes. Nevertheless, the Company adopts the practice of notifying its employees in advance. Eternit prioritizes the hiring of local labor and 52% of its management staff, including the Executive Board, is formed by professionals from local communities.

There is no risk of the occurrence of child or slave labor practices at the Group’s units. The Code of Ethics orients the activities of employees based on the principles of equal work opportunities without prejudice based on race, social class, nationality, religion, disability, gender, sexual orientation and any other forms of diversity. It also respects treaties and standards, including the rights of children and adolescents. Internal audits are conducted to verify compliance with these principles.

To avoid establishing relationships with partners that do not follow labor regulations, when assessing its supplier registry, the Company analyzes their compliance with regulations, sustainability practices and matters related to child, forced or slave labor. The Legal Department also analyzes clauses related to human rights in all agreements to reinforce this initiative. In 2013, there were no lawsuits or incidents involving the violation of human rights or indigenous rights. GRI SO8 | HR9 | HR10 | HR11

Employees in numbers GRI LA1

Total employees		2013
		Women	Men	Total4
Agreement	Labor law	286	2,097	2,383
	Third-party service providers1	n/d	n/d	815
	Apprentices	25	28	53
	Interns	26	24	50
Region	Osasco – SP	3	-	3
	Colombo – PR	18	302	358
	Rio de Janeiro – RJ	22	170	224
	São Paulo – SP	63	89	152
	Simões Filho – BA	24	182	240
	Goiânia – GO	17	279	330
	Minaçu – GO	73	648	1,358
	Anápolis – GO2	22	94	156
	Atibaia – SP3	55	183	238
	Içara – SC3	7	56	63
	Camaçari – BA3	13	31	44
	Frederico Westphalen – RS3	7	33	40
	Anápolis – GO3	8	47	55
	São José do Rio Preto – SP3	5	33	38
	Londrina – PR3	-	2	2
Total		337	2,149	3,301

1. Third-party data by gender is not available.
2. Precon Goiás Unit.
3. Tégula Unit.
4. The total by region includes third parties.

GRI LA2 Global Compact 6

Terminations		2013	Turnover (%)
Gender	Male	481	7.7
	Female	91	5.7
Age bracket	Under 25 years old	192	5.5
	26 to 30 years old	116	2.8
	31 to 40 years old	166	2.4
	41 to 50 years old	66	0.9
	Over 50 years olds	32	1.7
Unit	Colombo – PR	134	7.8
	Rio de Janeiro – RJ	27	2.5
	São Paulo – SP	36	2.2
	Simões Filho – BA	62	4.9
	Goiânia – GO	37	3.8
	Minaçu – GO	42	0.5
	Anápolis – GO1	38	2.4
	Atibaia - SP2	64	3.9
	Içara – SC2	16	2.8
	Camaçari – BA2	30	11.7
	Frederico Westphalen – RS2	22	7.9
	Anápolis – GO2	37	10.5
	São José do Rio Preto – SP2	27	5.9
Total		572	23.2

1. Precon Goiás Unit.
2. Tégula Unit.

Proportion of senior management members from the local community (%) GRI EC7 Global Compact 7 | 8 | 9	2013	2012	2011
Executive Board	60	100	100
Eternit and Precon	64	63	67
SAMA	17	17	14
Tégula	38	33	33
Total (Management + Executive Board)	52	57	51

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Relationship with former employees Eternit is committed to monitoring the health of former employees and suppliers in the chrysotile mineral production chain. The Company maintains a medical database with records, X-rays and chest CT scans of these persons. To obtain medical information, the Company makes available a toll-free number: 0800-622945. In Osasco, São Paulo, the Company also maintains a support unit to provide social assistance and medical follow-up for Eternit and SAMA employees.

Valuing talent
GRI LA12

All employees of SAMA and Eternit undergo formal annual performance assessments, which serve as the basis for their Career Plan at the Company. The Leadership Assessment Program uses a 360º Model. At the mining company, employees perform a self-assessment and are also evaluated by their manager. At Tégula, Officers, Managers and Supervisors undergo annual performance analyses, with this group corresponding to 6% of the total staff.

In 2013, Eternit adopted the YourLife software, which integrates all HR processes and enables faster and more dynamic assessments and the viewing and monitoring of historical data.

In line with good market practices, the compensation policy determines that all employees are eligible for variable compensation linked to performance targets based on the goals of each department. Officers and managers also have individual performance targets that include quantitative and behavioral factors. The Company maintains constant contact with the trade unions of each region where it operates and all salary increases are applied in accordance with the percentages established in collective bargaining agreements.

To ensure the satisfaction of its employees, the Group also offers a better benefits package than the industry average, which is aligned with its policy of focusing on the well-being and quality of life of its professionals and their dependents.

Comparison between the lowest salary paid and the local minimum wage (%)1 GRI EC5	20132		2012	2011
	Men	Women
Eternit
Head Office (SP)	187.3	121.7	83.0	175.7
Office in Osasco (SP)	0.0	442.1	447.2	525.2
Simões Filho plant (BA)	41.8	41.8	42.2	41.7
Goiânia plant (GO)	30.8	4.6	43.6	42.5
Colombo plant (PR)	77.5	41.9	21.9	23.7
Rio de Janeiro plant (RJ)	0.4	0.4	35.6	30.4
Precon	0.0	0.0	24.9	0.4
SAMA	94.4	60.7	62.8	72.0
Tégula
Anápolis plant (GO)	74.3	74.3	33.9	10.0
Camaçari plant (BA)	24.3	24.3	22.0	15.8
Frederico Westphalen plant (RS)	1.9	1.9	32.3	29.8
Içara plant (SC)	59.4	25.7	94.5	57.5
Atibaia plant (SP)	56.5	56.5	51.3	60.6
São José do Rio Preto plant (SP)	63.2	63.2	51.3	60.6

1. Data from 2013, 2012 and 2011 is consolidated considering all of the Group’s operations.
2. The indicator is monitored by gender since 2013.

Employee benefits GRI LA3
Benefits offered	Tégula - employees	Tégula - part-time employees	Tégula - third party	SAMA	Eternit and Precon
Health plan	X	X	X	X	X
Dental plan	X	X		X	X
Payroll loans	X
Private pension plans	X			X	X
Group life insurance	X			X	X
Food vouchers/Food staples basket	X	X		X	X
Meal vouchers/Cafeteria/Restaurant	X	X	X	X	X
Transportation vouchers/ Charter bus/Parking reimbursement	X	X		X1	X1
Tuition aid	X			X	X
Language school aid	X			X	X
Medicine aid/plan	X	X		X	X
Vision aid/plan	X	X		X	X
Wedding gift	X	X		X	X
Newborn kit	X	X		X	X
Christmas basket	X	X	X	X	X
Get-together events	X	X	X	X	X
Time of Service Award	X			X	X
Toys	X	X		X	X
Floral arrangement	X	X		X	X
Daycare benefit				X	X
Additional illness/workplace accident benefit					X
Emergency loan				X	X
Reimbursement of emergency medical expenses				X	X
Orthopedic/Podiatrist benefit				X	X
Quality of Life Program				X	X
Funeral Assistance				X
Loan for school supplies				X

1 . Reimbursing of parking rates paid for employees in São Paulo.

All companies in the Group conduct regular health and safety awareness campaigns to promote accident prevention and educate employees on diseases. GRI LA8

In the year, 12 women and 67 men used the maternity/paternity leave benefit, compared to 13 women and 72 men in the previous year.

Maternity and paternity leave by gender1 GRI LA15	Women	Men
Entitled to the leave	12	67
Took the leave	12	67
Returned to work after the leave	10	67
Were still employed 12 months after their return to work	10	63
Returned to work after the leave (%)	83	100
12-month retention after the leave (%)	100	94

1. Consolidated data considering all of the Group’s operations in 2013.

Private retirement plan GRI EC3

The Group contracts a private pension plan from a duly authorized private pension plan institution. The benefit aims to supplement the retirement and pension plans of employees and executives. The defined-contribution plans known as PGBL are offered to all professionals. The monthly contributions are made by the Company and participants based on pre-established progressive percentages.

At the end of the last three fiscal years, contributions were made to supplement the benefits plans in the following amounts:

Intellectual development GRI EC7 | LA11 Global Compact 7 | 8 | 9

Covering 100% of the employees of Eternit and Precon, the Placar Program (Career Plan) maps out and identifies professionals for future positions in the Group in a clear and transparent manner to enable everyone to invest in their careers. The initiative facilitates the formulation of individual development plans to guide employee training and development actions.

The Company offers a training plan that is structured in accordance with the needs indicated in current and future positions (based on Placar) and offers scholarships for university programs and language courses that cover 70% to 100% of the monthly tuition payments, respectively.

In 2013, a total of 110,670 hours of training was administered, which corresponds to 46.4 hours per employee. Investments on a consolidated basis amounted to R$1,666,303.00, or R$699.24 per employee. GRI LA10

Meanwhile, the GoLíder Program promotes leadership development in alignment with the competencies required for the business. In 2013, we organized training programs in Strategic Planning and Balanced Scorecard (BSC), among other activities. All Foremen, Coordinators, Supervisors, Department Heads and Managers at the Eternit, Precon, SAMA and Tégula units participated in the GoLíder Program. Eternit and Precon also launched the Young Engineers Program during the year to help attract new talent to the companies.

At SAMA and Tégula, the identification of the competencies that each employee must develop is conducted annually using the Training Needs Assessment (TNA) methodology. The mining company developed an educational incentive system that covers all of its professionals, regardless of their hierarchical level. It also created a program to help employees increase their household income and offer vocational training to the spouses and children of employees and service providers. Since 2009, the Second Half - Retirement Preparation Program has provided support to all employees who are less than three years away from retirement. On the other end of the cycle, the Trainee, Internship and Apprentice programs prepare new employees by providing them with the technical, administrative, interpersonal and cultural knowledge they will need at the mining company.