As TNT’s international business expands, so do our responsibilities in different cultures, political situations and social settings. The complexity of ensuring adherence to our global business principles in all these situations increases accordingly.

In 2006, as described in our social responsibility report, we performed an assessment of our Chinese subsidiary. This year, we look at our new Brazilian company, formerly Expresso Mercúrio S.A., and hereafter referred to as

TNT Mercúrio. Like in all our operations, our objective is to implement social responsible management systems that focus on the motivation and wellbeing of our staff.

TNT Mercúrio is the market leader for express deliveries in Brazil. With a strong presence in the south, southeast and northeast of the country, it has a total of 102 depots and covers over 3,300 cities. The company employs some 6,000 staff and operates in excess of 1,200 own and 1,600 subcontracted vehicles. In 2006, total revenues amounted to €190 million.

As in China, we partnered with the Dutch Humanist Committee on Human Rights (HOM), to assess the situation in Brazil. We again used the Human Rights Compliance Assessment (HRCA). The HRCA is a diagnostic tool designed to help companies detect potential human rights issues caused by the effect of their operations on employees, local residents and all other stakeholders. The tool consists of key questions and corresponding indicators. There are three types of indicators:

  • Policy: are there policies and guidelines in place to address working according to our principles?
  • Procedure: are appropriate and sufficient procedures in place to ensure the policies are implemented?
  • Performance: verification of company performance.

In the County Risk Assessment of Brazil, several focal areas were identified that constitute risks for any company operating there. These focus areas were subsequently tailored to the TNT Mercúrio situation. We call this the “Quick Check”.

Since it is not feasible to question all our employees, or even all our branches in such a large country, selecting an appropriate cross-section is important, taking into account local and regulatory environments. Accordingly, we chose two large depots in São Paulo and Porto Alegre (branch and head office), one medium-sized depot in Vitória and two small ones in Londrina and Salvador. We sent out 150 questionnaires, all of which were completed. Thirty percent of the questionnaires were sent to management and seventy percent to non-management. The employees completed the questionnaires individually and anonymously on hard copy.

The main issues that were identified from the survey and priorities to be addressed are:

  • policies and procedures. The current practices need to be formalised into policies and procedures and made available to all employees,
  • payment of minimum wages. There is no written policy on wages in place. However, TNT Mercúrio is paying more than the minimum wage required by the government and is paying 10% more than that agreed with the unions,
  • overtime (standard working week). According to International Labour Organisation (ILO) standards, the working week must be limited to 48 hours and overtime to 12 hours per week. In reality, the average overtime per employee is 15 hours per week. Overtime is not always possible to control as a result of vehicle congestion and hours spent at client premises waiting to (un)load. Management intends to bring the actual overtime more in line with ILO requirements, and
  • workplace health and safety and conditions of employment and work. There are as yet no clearly defined policies and procedures in place. A number of the branches have an Internal Commission for Prevention of Accidents (CIPA). Internal staff is looking into the conditions of the workplace and takes actions to prevent accidents at the workplace and on road or streets.

Since the assessment, we have initiated proceedings to address the issues. We have looked at and drawn up an action plan for four main areas.

Policies and procedures

Our short-term objective here is to formalise and align policies and procedures in accordance with TNT HR Guidelines and Clarity. In addition, we will soon be implementing the TNT Business Principles and Whistleblower policy across the organisation. In the longer term, we will communicate policies and procedures by wallboard, newsletter and the company internet site. We will also audit and monitor HR policies and procedures to ensure compliance with our HR guidelines.

Payroll

This will address the above mentioned overtime issue. We are in the process of developing reports and analysing overtime to create control mechanisms. In time, we will make OPS leaders aware of the drawbacks of increased overtime and will implement actions such as training and incentives to reduce and control it.

Social responsibility

Our main issue here is the company-wide introduction of social responsibility management systems covering health and safety, environment, social accountability, quality and Investors in People programmes. Our priority is to align TNT best practices and minimum standards with those of TNT Mercúrio, to implement social responsibility reporting and to roll out training programmes and workshops.

Compensation

Our final focus area is the alignment of compensation. We are in the process of defining job profiles for all positions. We will define job grades based on market research and define a new compensation policy to ensure company-wide harmonisation.

In addition to these four formal action plan initiatives, we recently organised the first National Week against Workplace Accidents, covering all branches and franchises. All employees, including drivers, were trained in ergonomics.

This assessment and the initial action plans are a first step towards creating awareness with management and employees for issues that are important for achieving the SA 8000, OHSAS 18001, ISO 14001, ISO 9001 and Investors in People standards.