8.4 Workforce Management

The following table features a breakdown of Copel's workforce in 2006:

Copel's 8,119 regular employees are distributed into four careers according to the nature of their duties and the requirements for their positions: operational (2,705 employees), administrative (2,438 employees), high school level technicians (1,676 employees), and college level professionals (1,300 employees). The Company has been expanding its workforce and in 2006 it hired, through public admission tests, 930 new employees (not including personnel hired by subsidiaries Compagas and Elejor). Out of this total, 790 were hired to expand Copel's own workforce, and 140 were hired to replace outsourced labor, particularly in technical and operational areas. During the year, 517 employees left the Company, most of them on account of retirement, and the employee turnover rate was 9.08.

Every regular employee of Copel is hired through public admission tests, which are open to native-born or naturalized citizens of Brazil, regardless of gender, race, or religious beliefs. Copel sets aside a share of the jobs available through public admission tests for applicants with disabilities and for African-Brazilians. In 2006, the Company assigned 5% of the available administrative jobs to applicants with disabilities. Thirteen African-Brazilian applicants were also hired.

The chart below features the number of Copel's employees in the last 12 years. The downward curve from 1995 to 2002 was due to a policy of outsourcing and incentives to early retirements and voluntary quit, in preparation for the Company's privatization process, which was never completed. The increase in personnel since 2003 reflects the decision to no longer privatize the Company, to expand its workforce to meet the restrained demand for labor, and to revert the outsourcing of essential services which are directly tied to Copel's business.

Turnover rate by age group and gender in 2006

8.4.1 Personnel Training and Development

The Company relies on several forms of training to qualify its employees and continually improve their performance, making use mostly of internal courses to supply demands resulting from the implementation of new technologies and procedures. In 2006, 2,364 training events took place (courses, seminars, and lectures), out of which 1,955 were conducted internally and 409 externally, with a total of 26,783 attendees. The average training hours per employee ratio was 60.4.

The Company also adopts a consistent policy to improve the educational levels of its employees, with significant investments in post-graduation courses, besides fostering self-development through an allowance-for-education program. Currently the Company has 2,927 college-graduated employees, of whom 874 have also attended postgraduate courses at the specialization level, 103 have been awarded Master's Degrees, and 11 are PHDs.

8.4.2 Salary Policy

Copel's policies concerning wages, performance recognition and incentive are based on a model structured upon two pillars: a fixed remuneration (compatible with the job market and the individual merit) and a variable remuneration (employee profit sharing or participation in results). Copel and CENPRL, a commission set up to address employee profit sharing, have made significant progress in their negotiations, establishing corporate goals, which were renegotiated in 2006. Copel's Career and Salary Plan was restructured to reflect the Company's occupational reality, which serves as a reference for the fixed remuneration policy, based on ensuring that the salaries paid by the Company are compatible with those prevailing on the job market. The proportion between the smallest salary paid by the Company (R$ 724.97) on 12/31/2006 and the national minimal wage (R$ 305.00) was 207%, and the proportion between basic salary for women and men presented no significant difference.

8.4.3 Benefits

In addition to the benefits mandated by labor laws, Copel directly grants all its employees the following ones: allowance for education, a vacation bonus, food allowance, allowance for day nursery, assistance to persons with special needs, and others made possible under an agreement between Copel and Social Security (INSS). Other benefits granted by the Company but managed by the Pension Plan (Fundação Copel de Previdência e Assistência Social), of which Copel is the main sponsor, comprise a private pension plan, which complements pensions paid by Social Security, and an extensive healthcare and dental assistance plan, one of the best in the market.

8.4.4 Freedom of Association and Collective Bargaining

All employees are represented in their labor relations with the Company by independent labor unions. Brazilian law provides for the organization of such entities according to professional category and geographic area (municipality).

Copel maintains a close relationship with all 18 unions that represent its employees: unions representing basic categories (power industry employees) and professional and/or specialized categories. Union representatives have free access to local managers and Company facilities to talk to employees, besides having a formal channel of communications with the Human Resources Department.

Employee participation in the labor negotiations is highly relevant and extends from attending the meetings called by the unions to discuss the agenda of labor demands to voting for accepting or rejecting the Company's proposals. Copel also fosters employee participation in trade associations, professional councils, and other entities.

The Company strives to bring to the attention of its employees significant changes in its operation, always with greatest possible anticipation, as in the case of the migration from part of the activities of transmission (assets) to the Distribution Office, and, consequently, the transfer of the employees. In this case, the subject was discussed with the unions and the employees were informed in many meetings.

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