Arch Coal isn’t competing for industry leadership in mine safety. We’re striving for perfection. As the world’s safest diversified coal producer, we’re dedicated to safety in everything we do. Our employees are our greatest asset. Arch’s talented workforce hails from 10 states, yet we share a common goal of safety excellence at every operation and at every level of the company.
Our commitment to safe work practices is focused on people, and our impressive track record helps continue momentum year after year. 2010 marked our third year of record-setting safety performance, with a lost-time incident rate of 0.46 per 200,000 employee-hours. Our rates average four times better than the U.S. coal industry average. That’s a source of great pride as we continue toward what we call A Perfect Zero. Until we reach zero injuries and zero environmental violations, we won’t be content.
During the past two years, Arch’s operations earned 28 state and national safety awards. In 2010, Mountain Coal Company’s West Elk employees were honored with a Colorado state safety award for the second year in a row, underscoring a dedication to excellence and continuous improvement. Arch facilities also have claimed multiple Sentinels of Safety awards and certificates bestowed by the U.S. Mine Safety and Health Administration (MSHA). Likewise, our Skyline mine has earned top honors for four consecutive years from the Rocky Mountain Coal Mining Institute for underground mine safety within an eight-state region. Five of our 13 mining complexes and facilities finished 2010 with no lost-time incidents. The growing list of safety honors is a testament to our ongoing pursuit of perfection.
During the past 10 years, Arch Coal’s total incident rate has dropped by 70 percent, yet further safety improvements are still possible.
Overall, we have invested $14 million in two-way communication and tracking systems for our underground mines. Mingo Logan’s Mountain Laurel mine was our first to adopt the system in 2010, and we expect to complete installations in 2011.
With a focus on injury prevention and protecting our people, we’ll work together to achieve and maintain A Perfect Zero. It’s fundamental to Our Charge.
Another tool we use in pursuing A Perfect Zero is a set of strong safety programs. In 2006, we launched Behavior-Based Safety (BBS), which engages employees in prevention and helps identify unsafe behaviors before incidents happen. A basic tenet for Arch is that safety is everyone’s responsibility.
Our mining subsidiaries were the first among public coal companies to adopt BBS. Through a “no name, no blame” approach, we encourage employees to provide regular feedback and suggestions to minimize risk in the workplace.
Thunder Basin stepped up as the first Arch subsidiary to adopt the BBS model. Since then, BBS has been adopted companywide and customized to fit each operation’s needs. BBS helps us improve traditional safety indicators, reduce and eliminate exposures and specific safety barriers, as well as reinforce safe behaviors and strengthen our safety culture. Having fewer incidents translates into less risk and greater reliability, too. As further evidence of our success, our overall rates for total incidents and lost-time incidents have improved an average of 57 percent since adopting BBS in 2006.
Beyond structured safety programs, preparation is critical to an effective response. Arch maintains 21 nationally recognized rescue teams. Our teams are some of the most highly skilled in the country and regularly earn honors in industry competitions. Teams stay sharp by conducting regular safety drills and exercises with state and MSHA officials.
As the foundation for the long-term strength of our business, we educate every employee at every level of the organization about good governance practices and ethical business conduct. Employees receive awards for exceptional performance in areas that exemplify our corporate values, including safety and environmental performance.
We share our Code of Business Conduct with new employees to foster a culture of integrity within our business, our communities and among our shareholders. Each year, salaried employees complete online training about anticorruption policies and procedures. We also encourage employees and investors to report any conduct violations. All reports made to our telephone and email hotlines (maintained by an independent third party) receive prompt investigation and, if warranted, an immediate response.
We also conduct an annual survey to capture management’s perception of the company’s leadership values and how they are carried out. The goal of the anonymous survey is to obtain an open and honest risk assessment. The internal survey results consistently indicate a strong tone at the top, ethical conduct and effective internal controls.
It’s only through hiring and retaining the best and brightest that Arch Coal is able to remain an industry leader. Arch’s responsible reputation and values-driven approach attract one of the most talented workforces in the energy industry.
Potential employees also are attracted to Arch Coal as a responsible and growing Fortune 1000 company, and to its leadership in providing a domestic, secure and increasingly clean fuel source.
Arch supports ongoing employee development, from tuition reimbursement to free online training, and tailors employee education to fit each individual’s needs. An internal study recently revealed that being an enthusiastic learning advocate is a shared trait among successful Arch employees.
Our employees receive regular and ongoing safety training. As one example, more than 4,000 behavior-based safety observers were trained in 2009 and 2010. If an at-risk behavior or barrier is identified by an observer, employees are empowered to use problem-solving skills to resolve the potentially unsafe condition or practice.
In addition, 1,500 educational courses were completed online, and 319 employees attended an instructor-led, multi-day leadership workshop during the previous two years.
Arch recently launched two advanced leadership workshops: The Power to Lead Workshop and The LIFT Series of Workshops. Led by instructors, these sessions help refine communication and leadership skills that enhance job effectiveness and drive employee engagement.
To retain a high caliber of talent in a growing industry, Arch offers highly competitive pay and extensive health, welfare and retirement benefits. Arch provides a 401(k) plan and company-funded, portable pension plans for full-time and part-time employees. We contributed $17.3 million to these plans in 2010 and $18.8 million in 2009.
Our employees also count on generous benefits like adoption and education support, long-term care insurance and retirement planning seminars.
Arch Coal’s health and wellness program includes proactive disease management and tailored advice and coaching for a variety of health issues. Employees and their family members also can contact a registered nurse through a free and confidential nurse line, where support is available 24/7 on thousands of topics. In addition, company health fairs provide free health screenings and information for employees and spouses.