Conflict and security

Business principle: Communication and engagement	In our interactions with business partners, we seek to listen and respond to them honestly and responsibly.
Business principle: Communities	We build productive, collaborative and trusting relationships with government, our shareholders, our business partners, the local communities where we work and with each other.

Conflict and security

Industrial relations

Continuous monitoring and analysis of the current situation with personnel are performed to prevent any violations of rights of the workers within contractor and subcontractor organisations, and also to identify and address any potential factors, as well as root causes and conditions contributing to social non-conformities, infringement of the legitimate rights of the employees. Such risks can be caused by an employer’s failure to provide for acceptable social conditions and compliance with regulatory requirements. In 2023, 23,198 people from 172 contractor companies have been employed at the Karachaganak field; 53 out of 172 are being monitored by KPO Industrial Relations Section as per par. 7.3 “Industrial relations regulation”.

IN 2023, 23,198 PEOPLE FROM 172 CONTRACTOR COMPANIES HAVE BEEN EMPLOYED AT THE KARACHAGANAK FIELD; 53 OUT OF 172 ARE BEING MONITORED BY KPO INDUSTRIAL RELATIONS SECTION AS PER THE SET CRITERIA.

When examining an alleged violation of employee’s rights, KPO seeks to ensure a comprehensive and prompt redress of all grievances /complaints and timely resolution of all issues. The process involves the review and analysis of opinions from all sides, followed by reasonable measures aimed at protecting and reclaiming the labour rights of employees in accordance with the RoK legislation, KPO Industrial Relations Policy and contractual commitments, and the Declaration of Acceptance of Social Security Obligations, including:

• Continuous monitoring of day-to-day social conditions, provided by contractors, full and timely payments of wages, provision of PPE, meals, etc.
• Organising subject forums and conferences dedicated to the relevant themes (HSE, social welfare etc.);
• Co-operation and engagement with competent labour protection authorities in the settlement of conflict situations, as well as awareness-raising and educational events;
• Continued introduction of a minimum salary for contractor employees involved in the provision of services in the amount of KZT 830 per hour after taxes. Implementation is executed until the expiry of the effective agreements;
• Monitoring and analysis of the contractor’s wage level;
• Succession/transfer of qualified personnel from an existing contracting company (whose contract is expiring) to a new one. This implicit practice helps to sustain employment in the region and maintain a stable social environment during the termination of the service contract.

As part of maintaining a stable social environment in the contractors’ teams, KPO continues to implement a single wage allowance of KZT 60 thousand monthly, after deduction of tax payments. By the end of 2023, through the implementation of this programme, the material condition of more than 18 thousand of contractor and subcontractor personnel has improved. The goal of this approach is an equal attitude to all beneficiaries, with substantial focus on the category of workers with the lowest wages.

In 2023, the monitoring demonstrated a positive dynamic with 69 contractor companies indexing wages for 2023 to the rate of inflation in 2022.

In 2023, members of KPO Industrial Relations Section have visited over 1,024 work sites and compact accommodation premises, including 12 joint audits with the contract holders. Based on the audits results, a good progress was made with the establishing of industrial relations units in large contractor companies.

12 sessions of the tripartite district commission were held during 2023 to discuss risks identified in the contractor and subcontractor companies. As part of the monitoring process KPO also follows the growing number of Collective Agreements in the contractor companies as they serve as an indicator of compliance with the employees’ rights for freedom of association and collective bargaining.

In 2023 the number of Collective Agreements in KPO contractor companies has almost doubled: 58 contractor companies had Collective Agreements in place comparing to 32 companies in 2022.

In 2023, total 226 complaints/grievances on different subjects from contractors’ employees were received and closed. 90 % of the grievances had to do with salary payment and remuneration issues (the growth in number was due to the introduction of the general salary increase by KZT 60 thousand), 9 % of the grievances were related to HSE matters and 1 % were related to the provision of day-to-day social conditions.

Apart from the written grievances, KPO Industrial Relations Section has been also processing average 10 daily phone calls and holding meetings with employees from contractor and subcontractor organisations. In general, as a result of the monitoring, audits and processing of received grievances, actions on improvement of living and labour conditions were taken in 53 contractor companies monitored by the Industrial Relations Section. This, in its turn, has contributed favourably to maintaining a stable moral and psychological atmosphere in the working teams. Percentage of suppliers identified in 2023 as having significant actual and potential negative social consequences, where improvements were agreed as a result of the assessment – 8 %. No contract was terminated with suppliers as a result of the assessment of actual and potential negative social consequences.

As part of the work performed to prevent an impairment of rights of employees, a monitoring has been ongoing for the compliance with the declared working conditions and social welfare. In the course of this work, a comprehensive approach is applied: each request/grievance is thoroughly scrutinized based on a complete set of information.

Tab. 24.Examples of contractor organisations’ grievances to KPO Industrial Relations

Starting from 2023, KPO has decided to hold an annual forum on industrial relations. The purpose of the event is to improve communication and to maintain a favourable social atmosphere in the region and the moral and psychological climate within the personnel of contractor and subcontractor companies.

During the reporting period, seven pre-strike scenarios were registered, which have been timely localized, thus preventing the spillover (escalation) of conflicts. The timely response has made it possible to prevent negative preconditions for mass discontent.

The analysis conducted by KPO Industrial Relations Sector indicate that the main triggers for discontent were a lack of feedback, a distorted and incorrect perception of the personnel by the management of some of the contractor companies, and low wages that do not meet people’s expectations.

Security

To minimize security risks for the Company and the latter’s impact resulting from its activities, we have determined several targets – the results of their implementation are presented below.

Tab. 25.Our targets in security

Following the results of 2023, KPO Security and Industrial Relations Department has revealed 1,374 violations, 94 % of which were related to the Strategy for protection of people in the event of H₂S incidents while the rest involved Material and Asset Movement Control, Policy on Prohibition of the Use of Alcohol, Drugs, Psychotropic and Toxic Substances (their analogues) in KPO and violation of border of the Field perimeter. A significant number of registered violations is due to the measures undertaken to prevent individuals not following the H₂S Strategy when entering the Field.

27 internal investigations were conducted, including 11 applications which were submitted to law-enforcement agencies.

DURING 2023, KPO HAS REVEALED AND PREVENTED ATTEMPTS OF UNAUTHORIZED REMOVAL/RELOCATION OF KPO AND CONTRACTORS’ ASSETS WORTH OVER KZT 200 MLN.

During 2023, KPO has revealed and prevented attempts of unauthorized removal/relocation of KPO and contractors’ assets worth over KZT 200 mln.

The use of the new Sintela security software as a platform for the system of deployed optical sensors has significantly increased the overall monitoring quality, including more precise threat identification of threats and the improvement of patrolling.