Aspect 2: Employee concerns

The digital transformation is expected to improve everyone’s lives. That is why people will remain a priority for us. This applies in particular to the 216,000 or so employees working in our Company. They use their commitment, their expertise, and their abilities to smooth the path towards a digital society and thus make a key contribution to our business success. Five Guiding Principles, representing our values, form the cornerstones for collaboration within our Company. These Guiding Principles are stated in the section “Group organization.” Our strategic priorities in HR focus on four areas. For further information, please refer to the “Employees” section. We attach great importance to employee involvement and fair behavior toward colleagues, promote diversity, and engage in systematic health management. SDG 8

Collaboration with employees’ representatives and trade unions SDG 17

Digitalization is fundamentally changing the way we work together. Employees are expected to demonstrate greater flexibility, social skills, and autonomy, to continue learning throughout their lives, and to work with greater independence. We have made it our goal to support our employees in this transformation – and to help them not just overcome change, but take an active role in shaping it.

Codetermination rights play a key role in the digital transformation. Together with employees’ representatives and trade unions, we want to create the working world of the future – with an eye to the needs of our workforce and the success of our Company. We negotiated and signed over 150 agreements in 2018 through constructive dialog with our works councils. In the same year, we ran two organizational programs – “Technology & Innovation 2018” and “T Systems Transformation” – as key transformation projects in close collaboration with the works councils. The relevant business areas were restructured as these projects progressed, which has led to the optimization of organizations and processes, the establishment of flexible forms of organization, as well as the workforce being restructured as required in a socially responsible way. In addition, 85 collective agreements were concluded with the trade union ver.di in the course of 2018. Besides collective wage agreements, the focus in 2018 was placed on collectively agreed arrangements to harmonize the Group’s pay systems as closely as possible. As the underlying laws and contracts vary from country to country, codetermination matters are managed locally with trade unions and employees’ representatives. Group management is involved in all major issues as a matter of principle.

The works councils, central works councils, and Group Works Council represent the interests of Group employees in Germany. Our partner representing the employees’ interests on a European level is the European Works Council (EWC). We also have executive staff representation committees and representatives of disabled employees at unit, company, and Group level. The EWC, which has 32 members, has been one of our established key dialog partners for many years, representing the interests of Group employees in countries within the European Union and the European Economic Area. Collective bargaining plays an important role and has a long tradition at our Company, a fact made clear by the percentage of employees covered by collective agreements. As of December 31, 2017, 72.76 percent of employees in Germany were covered by collective agreements. For the Group as a whole, the coverage rate was 52.28 percent. We carefully monitored the trade union matters in the United States over the course of 2018. The responsibility for national human resources management matters in the United States lies with T-Mobile US’ management. This responsibility is assumed with a great deal of commitment and accompanied by excellent customer satisfaction results.

Across the globe, Deutsche Telekom respects the rights to freedom of association and collective bargaining in accordance with national law. This naturally also applies to the United States, with each employee at T-Mobile US entitled to form or join a trade union. At the same time, employees are also free to choose not to do so. T-Mobile US will not exert any influence in this respect, neither favoring nor discriminating against employees because of a decision they have made.

The results of employee surveys conducted at T-Mobile US in 2018 showed that 93 percent of respondents take pride in working for the company. 89 percent said they would recommend T-Mobile US as a great place to work, and 84 percent believe the company inspires them to go above and beyond their usual work-related duties. These results are among the highest in the Group. T-Mobile US has been awarded numerous accolades in recent years for its appeal as an employer. In 2018, T-Mobile US was named “Best Place to Work” by the independent employee platform Glassdoor and ranked 86th in the top 100 Fortune U.S. companies in the categories “Great Place to Work for Diversity” and “Great Place to Work for Families.” For ten years in succession, T-Mobile US was rated one of the most ethical businesses worldwide by Ethisphere Institute and for eleven years in succession as one of the United States’ top military friendly employers. T-Mobile US also received a perfect score of 100 in the Human Rights Campaign Corporate Equality Index for the fifth time in a row, making it the best place to work for the equal treatment of gay, lesbian, bisexual, and transgender employees.

Collaboration with employees’ representatives is founded on our commitment to trusting cooperation – anchored in our Group-wide Employee Relations Policy, which sets out eleven core elements describing what we stand for as an employer around the world. The policy also describes our aspiration with regard to the following HR topics: employee development, responsible handling of changes, health and sustainability, fair pay, work-life balance, leadership, diversity, the prohibition of discrimination, and how we communicate and work together with employees’ representatives. In order to ensure the Employee Relations Policy is implemented throughout the Group, two or three national companies undergo an internal review process each year. If the results of this review deviate from the norm, we initiate improvement measures. Our Code of Human Rights & Social Principles also includes a voluntary commitment to safeguarding the freedom of association and the right to collective bargaining (in compliance with national law in each case).

Our employee survey, carried out every two years, is a key indicator of the relationship between our Company and its workforce. We supplement it with pulse surveys, which give us a snapshot of the mood across the Group twice a year. In the most recent employee survey (excluding T-Mobile US) from 2017, the commitment index came in at 4.1 (on a scale of 1.0 to 5.0) and therefore remained at a high level. This result was underscored by the pulse survey carried out in November 2018. For further information, please refer to the “Employees” section.

Diversity and equal opportunity SDG 10

Just as much as demographic developments and different perceptions of roles, social trends such as globalization must not lead to certain groups being shut out of the labor market. Equal opportunities are essential for social stability and business alike. Respecting human individuality and harnessing individuals’ distinctive traits for joint success is just as important for our Group as developing a shared identity. A Culture & Diversity team, based in the HR Development unit, was created specifically for this task.

Women and men, young and old, as well as people with different abilities and cultural backgrounds from roughly 150 countries work together very effectively at our Company. This diversity helps us remain competitive around the world with good ideas and outstanding products, and consolidate our position as an attractive employer. Developments in the proportion of women in leadership positions and serving on the supervisory boards are reported to and discussed in-depth by the Board of Management every six months, while the age structure and internationality of the workforce is recorded on an annual basis in our Personnel Structure Report. For us, diversity also means offering our employees numerous opportunities to develop personally and grow professionally, regardless of their gender, age, sexual preference, health situation, ethnic background, religion, or culture. Our Group-wide Diversity Policy, five Guiding Principles, the Employee Relations Policy, and Code of Human Rights & Social Principles form the foundation of our commitment to diversity. We are also a founding member of the corporate Diversity Charter initiative and strive to promote diversity within and outside of our Company. For further information, please refer to the “Employees” section.

We meet the requirements set out in the Act to Promote Transparency of Pay Structures by publishing a remuneration report every five years. The last time we did so was as part of our 2017 Annual Report.

Occupational health and safety SDG 3

Measures that promote health within the Company not only help individual employees and ensure long-term business success, but also have positive effects beyond that on society as a whole. We use health management to take on social responsibility and promote a proactive culture of health. We support our employees in maintaining their health and occupational safety with a host of target audience-specific measures and extensive prevention programs. We consider the statutory requirements to be only the minimum standard we must achieve. Our corporate occupational health and safety measures are effectively incorporated into our structures via certified management systems and appropriate policies and guidelines. We support this Group-wide approach with an internationally standardized health, safety, and environmental management system based on the OHSAS 18001, ISO 45001, ISO 14001, and ISO 9001 international standards for health, occupational and environmental safety, and quality.

The Board of Management bears overarching responsibility for safeguarding health, occupational safety, and the environment. Quarterly reports on the health rate are just one example of its commitment in this area. Our Health & Safety Environment handbook outlines our health and safety management system, including the parties involved, their duties, and the programs in force. The handbook serves to harmonize, simplify, and align our management system with common targets across the Group. We pool together and manage our occupational safety and health protection programs at a Group level, with on-site health and safety managers responsible for putting them into practice. We systematically review our programs to ensure they are effective. To do so, we review the results of our employee survey, evaluating stress prevention measures under collective agreements, competitor benchmarks, and other relevant indicators. We analyze this data each year to derive measures that exceed the statutory requirements. Raising awareness, prevention, and encouraging individual responsibility are high priorities at our Company.

Group-wide initiatives serve to promote health awareness and health literacy among all employees. For example, all teams across 30 countries are issued recommendations and granted access to services depending on their health index rating. These include services that can be used by all teams in 30 countries based on the results of the health index, which is determined every two years. Occupational health promotion in Germany covers a range of services for employees such as stress prevention programs; flu vaccinations; colon cancer screening; information on diet and nutrition, exercise, and relaxation; and a comprehensive annual health check-up. We also offer psychosocial support to our employees and managers. Standards in Germany serve to improve occupational safety by regulating aspects such as safe, ergonomic environments in buildings and vehicles. Furthermore, we offer all employees and their relatives driver safety training (for passenger vehicles and motorcycles), as well as cycling schemes for employees at various locations across Germany. Alongside generally available services, we also have target group-specific programs in place, such as driver safety training for specific areas of work, and the “Tritt sicher” (step safely) campaign developed in cooperation with Berufsgenossenschaft Verkehr, the German professional association for transport and traffic, to prevent trips and falls. By raising awareness and implementing preventive measures, our aim is to promote employees’ health, boost their motivation, improve the health rate, and continue to reduce the accident rate.

A variety of key figures demonstrate the effectiveness of our corporate health management services. The health rate (including long-term illnesses) at Telekom Deutschland was 93.6 percent in 2018 (prior year: 93.7 percent). Excluding long-term illnesses, the health rate in 2018 stood at 95.3 percent (prior year: 95.4 percent). The target for 2018 was 95.6 percent. The health rate is reported to the Board of Management at the end of each quarter. In 2017, we launched a project designed to steadily improve the health rate by 2020. We aim to bring the Group-wide health rate up to 95.9 percent by 2020 (excluding long-term illnesses). The total number of work-related accidents continued to decline in the reporting year in comparison with the previous year. With 8.7 accidents (resulting in over three days of absence) per thousand employees, the accident rate in Germany was well below the industry average. The Group-wide health index – calculated in 30 countries as part of the last employee survey in 2017 – increased by 0.1 to 3.6 (on a scale from 1.0 to 5.0). As in previous years, 2018 saw a range of new measures being taken to raise the health rate, such as a workshop where management staff learned about different short-, medium- and long-term strategies for promoting health. Plans are in place to implement further health promotion measures throughout the Group by 2020. With digital transformation set to take on an increasingly important role in the context of health, we are looking into potential strains that digitalization may cause. Step by step, we are adapting our health programs to the needs raised by progressive virtualization, digitalization, and internationalization. For example, we already offer web-based training for managers on health and safety, mental health, and operational integration management. In 2018, we teamed up with BARMER health insurance to further expand our Digitalization and Health project launched the previous year. For example, Deutsche Telekom employees were given the opportunity to test the M-sense app, which enables users to analyze the specific causes of their headaches and migraines, and draw up a personal treatment plan. Based on the results, a decision will be made whether and how M-sense will continue to be used at Deutsche Telekom.