Efficient measures for recruiting specialist staff
Number of employees and trainees up
Staff development tools optimized
Diverse approaches for motivating staff

Human resources strategy: Finding and retaining the best

Highly qualified employees with above-average motivation form the basis for HOCHTIEF Group's sustainable worldwide success. Hence, in this age of globalization, our human resources management activities aim to identify talented individuals in Germany and internationally at an early stage, to secure them for the company and to support their continuous development. A key aspect of these activities is comprehensive skills management, ranging from the training phase through to the development of new managers. Active knowledge management ensures that knowledge is transferred between all HOCHTIEF units, both nationally and across national borders. In this way, we set HOCHTIEF apart from its competitors and generate sustained growth. Our human resources strategy is thus an integral part of our overall corporate strategy.

Effective response to shortage of specialist staff

The companies in the international HOCHTIEF network – just like the construction industry as a whole – are facing an acute shortage of skilled and management personnel. This situation persists even in these times of financial crisis. In 2008, we were notably seeking employees for the technical facility management, electrical engineering and energy management sectors. It was still difficult to recruit construction engineers for international assignments. Nevertheless, we managed to fill 70 percent of vacant positions in the HOCHTIEF Group in the year under review through a range of activities.

This success was thanks in part to the Global Recruiting Initiative launched in 2008. Our international network makes it possible to advertise vacant positions across national borders and fill them in a targeted way. The HOCHTIEF companies HOCHTIEF Construction, Thiess, Flatiron and Turner are all part of the network and, with their brands which are well-known in their respective regions, help to establish HOCHTIEF as an attractive employer worldwide.

Our Group program "Employees Recruit Employees" has once again proven highly efficient. In 2008, 88 positions were filled in this way in Germany alone. Worldwide, several hundred employment contracts have been signed so far. Turner benefited from similar measures, taking on 196 new employees in the fiscal year.

Intern retention program launched

It is our goal for the company to retain the top ten percent of interns long-term. To this end, for instance, we offer them the opportunity to write their final thesis at HOCHTIEF. The intern retention program set up in the year under review offers above-average engineering and economics students the opportunity to discover the whole spectrum of the company. Experiences have been positive and the program has been very well received by students.

Potential future employees actively approached

In 2008, HOCHTIEF further increased its presence at university job fairs and graduate conventions. Also in the year under review, we began to hold "practical seminars" for particularly talented engineering students four times a year at a number of locations. These meetings not only offer the participants a chance to get to know HOCHTIEF better, they also give us a good idea about how qualified our candidates are. The seminars are already proving a success. The recruiting ad concept and the new Job opportunities section on the HOCHTIEF website also generated additional interest. The number of applications increased tangibly.

Schoolchildren enthused by technology

HOCHTIEF's efforts to ensure the next generation of engineers begin in schools. In the year under review, for instance, we again took part in "Girls' Day", where girls are introduced to technical professions. HOCHTIEF launched further initiatives in 2008 to get children excited about technology at an early age, and these will be intensified in 2009.

Further increase in staff numbers in 2008

In the year under review, the number of persons employed by HOCHTIEF increased by approximately 23 percent over the previous year. Two reasons for this continued rise

Number of employees at HOCHTIEF

were major contracts in the Asia Pacific division and acquisitions within the Services division.

High level of trainee numbers

In the year under review, HOCHTIEF had a total of 521 trainees in 31 different professions in Germany, 187 of whom began their training in 2008. Thus, the number of trainees increased compared to the prior year and we continued to train young people beyond current demand in order to give more of them a better qualified start to their working lives. Following their traineeship, 72 percent of trainees were hired in the year under review and twelve trainees took up a course of study. We generally attach great importance to providing our future employees with sound training ourselves.

Staff development as key to success

In order to grow sustainably, a company needs highly qualified employees with a high level of personal development. We are well aware of this and act accordingly, working continuously to improve staff development. This benefits not just the company: It offers employees the opportunity for continuous development, both personally and professionally, and to make attractive career choices.

HOCHTIEF increased its expenditure on training and continuing education again in the year under review in order to go on motivating our employees to perform at their best and offer our clients groundbreaking solutions. Employees' willingness to take advantage of these offerings rose again in 2008, with the number of participants increasing by around 14.5 percent.

HOCHTIEF Academy program expanded

All of our measures and tools for employee and management development are consolidated under the auspices of the HOCHTIEF Academy in an end-to-end training program. This in-house facility provides in-service continuing education for industrial and technical employees as well as external

students. In the year under review, for instance, eleven graduates were awarded the officially recognized title of "Bachelor of Engineering – Construction Site Management." In 2008, we expanded our offering to include the "Bachelor of Facility Management" degree program. The continuing education program is complemented by additional areas of cooperation with renowned universities. For example, our Australian subsidiary Leighton and its subsidiary Thiess work with the University of Queensland, thereby offering their employees comparable continuing education opportunities.

Our US subsidiary pursues similar goals with Turner University. Turner has, for example, set up an online learning platform with development and training programs specific to professional groups on areas such as quality management or financing. We plan to make this platform available to all Group employees worldwide.

Leadership program intensified

At the heart of staff development at HOCHTIEF lies the ongoing, Group-wide training of the management team. Above all, the aim here is to strengthen and consistently fine-tune the role of managerial staff. In 2008, we continued to forge ahead with the transfer of knowledge and experience between the corporate units by way of Group-wide management development initiatives. In this way, the content of the leadership program was given an even greater practical focus and continuous learning was promoted throughout the Group.

Talent management optimized

In response to calls by employees for improvements in the identification and development of talented junior staff, the Group came up with a whole range of activities. To this end, we refined all of our national and international programs for analyzing potential, such as our HOCHTIEF forums, thereby improving the parameters for early, personalized staff development.

Program set up for older employees

We do not just foster junior staff. The "50+" program aims to recruit seasoned, older employees in particular for international assignments, thereby benefiting from their expertise. Practice has shown that there is considerable interest in

such opportunities among this age group, since these employees tend to be in a phase of life more amenable to international assignments. Our comprehensive healthcare management helps to keep our older employees fit.

Effective tools for motivating employees

Motivated staff perform particularly well. For this reason, HOCHTIEF does more than offer attractive career opportunities to keep its employees satisfied. Remuneration studies carried out in the year under review show that the compensation employees receive from the Group reflects performance and is fair and good. HOCHTIEF employees paid according to collectively agreed pay scales in Germany also receive performance-based compensation. Our subsidiaries Turner (USA) and Leighton (Australia) similarly apply bonus and incentive systems based on the company's performance.

For us, a positive corporate culture includes a healthy work-life balance. The "Work and Family" certificate demonstrates HOCHTIEF's intensified commitment to promoting a balance between work and family. This commitment applies throughout the Group and we have implemented a wide range of initiatives. In 2008, for instance, HOCHTIEF once again invited some 200 of our employees' children to the "HOCHTIEF Easter holiday action days" at the company"s headquarters in Essen, where the children learned about HOCHTIEF.

HOCHTIEF is proud of its high level of employee satisfaction, which is also reflected in how long employees remain with the company. In Germany, for example, average length of service is 12.2 years, at Turner it is 7.6 years and at HOCHTIEF in the Czech Republic it is 10.8 years. We aim to improve on these good figures even further, for example, by acting on the findings of internal surveys which show us where action needs to be taken – like the specially designed employee survey carried out in 2008 at HOCHTIEF Property Management to review the success of the integration of the acquired companies.

New employees integrated successfully

We have good expertise in integrating new employees into the HOCHTIEF Group. Due to the acquisition of Flatiron, some 2,500 employees were integrated into the Group during

the course of the year. Furthermore, HOCHTIEF Facility Management took on 40 employees from the Abbott pharmaceutical group. HOCHTIEF ensures success by calling on an integration team when it acquires companies. This team is among other things responsible for developing solutions for future organizational structures and cooperation based on best practice.

Intensive internal communications

A key component of HOCHTIEF's corporate culture is timely, open communications with employees in all areas of the Group. This is why we report those issues that are important to our employees in numerous employee publications and newsletters, on the HOCHTIEF intranet, at meetings as well as in many other ways. Moreover, every employee receives a comprehensive information pack about their new employer when they join the company.

Thanks to employees and employee representatives

HOCHTIEF's sustained growth and excellent reputation around the globe are down to our employees. We have them to thank for our outstanding results in fiscal year 2008. The above-average commitment, high level of qualification and loyalty of each and every employee make us strong.

Our solution-driven discussions in a spirit of partnership and close cooperation with employee representatives are also major factors contributing to the success of HOCHTIEF. We would like to thank them, too, for working so well with us.

Main points of the Executive Board and Supervisory Board compensation system

The main points of the compensation system as well as details of payments received by individual members of the Executive Board and Supervisory Board from Group companies for fiscal year 2008 are summarized in the compensation report.* This report is to be considered part of the combined Company and Group Management Report.