welcome… · 2020. 9. 10. · national eap target 100% 42.70% 5.20% 1.70% 5.10% 35.80% 4.40% 1.10%...

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SKILLS DEVELOPMENT MASTERCLASS WEBINAR

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Copyright ©Alternative Prosperity Advisory and Products (Pty) Ltd, 2015

SKILLS DEVELOPMENT MASTERCLASS WEBINAR

10 September 2020

33

ALTERNATIVE PROSPERITY GROUP

Alternative Prosperity Group

90%

Alternative Prosperity Advisory (Kenya)

Focus:

ESG and Sustainability

Integrated Reporting

Head:

Cecilia Bjorn-Murai

82.5%

DNA Economics (Pty) Ltd

(South Africa)

Focus:

Economic Development Research and Policy

Head:

Matthew Sterne

100%

7%

31,02%

AP (JHB)(Division)

AP (CTN)(Division)

Six Capitals Advisory

(South Africa)

Focus:

Responsible Investment Advisory & Consumer Financial Education

Head:

Adrian Bertrand

Clients:Listed, Large and QSE

Companies & Non-Profits

Clients:Asset Owners and Investment

Managers

Clients:Government, DFI and Large

Companies

Clients:Kenyan Government, DFI and

Large Companies

Clients:Large Companies, Government,

QSE’s

Alternative Prosperity Advisory

(South Africa)

Focus:

B-BBEE and Transformation

Head:

Erosha Govender

AP Solve

(South Africa)

Focus:

Solutions across the scorecard in collaboration with:

Head:

Trevor Chandler

100%

• B-BBEE Scorecard & Gap Analysis• Transformation Strategy Development• Ownership Analysis & Structuring• Technical Advice & Opinions

44

Agenda

1. The role of Skills Development in Transformation

2. The Skills Scorecard and Key Considerations

3. A closer look Learnerships, Apprenticeship and Internships

4. The Impact of Changing Rules

5. What are your Skills Goals: Real Impact vs Compliance?

6. Impact Strategy Options that make Business Sense

7. YES Programme

8. Q&A

55

POLL

In your view, what impact has the B-BBEE scorecard made in bringing about transformation in SA?

1. Very little

2. Some impact, but not enough

3. Good progress

4. Big impact

66

1. The role of Skills Development in transformation

77

1.1 Intent of this element

THE SKILLS DEVELOPMENT ACT, 1998

The purpose of the Act“The Skills Development Act aims to expand the knowledge and competencies of the labour force in order to improve productivity and employment.”

The Main Aims of the Act are:• To improve the quality of life of workers, their prospects

of work and labour mobility;• To improve productivity in the workplace and the

competitiveness of employers;• To increase the levels of investment in education and

training in the labour market and to improve the return on that investment;

• To promote self-employment

B-BBEE Codes Objectives• Allow for meaningful participation

in economy• Change in skilled occupations• Access to economy• Sustainable development and

general prosperity

8

1.2 Skills Development trends

The key is to empower“Studies in the US, by San Francisco-based award-winning learning platform Degreed, reveal that up to 85 percent of employees do not feel like the training they get at work is preparing them for their next position. When customer behaviour changes, however, new developments reshape industries, or new competitors emerge, business strategies (and therefore people’s skills) need to adapt. And yet 77 percent of CEOs, according to PwC’s annual CEO survey, say a lack of key skills is a serious threat to their business growth prospects. These disconnects show that traditional approaches to education and training, and to quantifying and communicating people’s skills, are not responsive enough to keep up with the pace of change.”

- CHRO South Africa https://chro.co.za/article/the-key-is-to-empower

https://chro.co.za/article/the-key-is-to-empower

99

1.3 Importance of Skills Development in the scorecard

ElementGenric Large Enterprises

Ownership * 25

Management 9

Employment Equity 10

Skills Development* 20+5

Preferential Procurement* 27+2

Enterprise Development* 5+1

Supplier Development* 10+1

Socio-Economic Development 5

Consumer Ed./Econ. Development

TOTAL 111+9

* Priority Element: at least 40% of points must be achieved to avoid being discounted by 1 BEE Level

FSC(Asset Managers)

ICT Construction Property

25 25 27+4 30+3

8 13 12 9+2

8 10 8+2 13+4

20+3 20+5 29+5 19+3

20+4 25+2 18+3 24+2

5+2 15+1 5+1

10+2 10+2 9 10+1

3+2 12 5+1 2

2+1 5

105+11 130+10 108+15 117+16

10

1.3 Importance of Skills in the scorecard

• Priority element: Need to achieve 40% of points avoid a BEE level discount

• One of the elements where points can be made up in a shorter time span to achieve a higher compliance level

Contributor levelPoints Scored

Recognition levelAmended Codes

Level 1 Contributor >100 135%

Level 2 Contributor 95 - 100 125%

Level 3 Contributor 90 – 95 110%






Non-Contributor <40 0%

11

1.3 Importance of Skills in the scorecard

• Critical link to Employment Equity:

– if the Employment Equity element has a low black representation, or a significantly skewed black representation, then it will be difficult to perform well within Sills element.

• Key question: Can we achieve scorecard points while also making an impact in terms of:

– Developing your employees to grow their careers

– Filling the skills gaps to improve Company productivity

1212

2. The Skills Scorecard and Key Considerations

1313

Description Weighting Target

Skills Development Expenditure on Learning Programmes specified in the Learning Programme Matrix for black people as a percentage of Leviable Amount.

6 3.5%

Skills Development Expenditure on Bursaries for Black Students at Higher Education Institutions

4 2.5%

Skills Development Expenditure on Learning Programmes specified in the Learning Programme Matrix for black employees with disabilities as a percentage of Leviable Amount

4 0.3%

Number of black people participating in Learnerships, Apprenticeships and Internships as a percentage of total employees.

6 5%

Bonus Points: Number of black people absorbed by the Measured and Industry Entity at the end of the Internship, Learnership and Apprenticeship

5 100%

TOTAL SCORE 20 + 5

2.1 Generic Skills Development Scorecard - Large

EAP targets applied

1414

2.1 Financial Sector CodeSKILLS DEVELOPMENT – AMENDED FSC Weighting Target

Spent on Black Senior and Exec Managers (Senior & Execs) 1 2.00%

Spent on Black Women Senior and Exec Managers (Senior & Execs) 0.5 1.00%

Spent on African Senior and Exec Managers (Senior & Execs) 0.5 1.73%

Spent on Black Middle Managers 1 3.00%

Spent on Black Women Middle Managers 0.5 1.50%

Spent on African Middle Managers 0.5 2.59%

Spent on Black Junior Managers 1 5.00%

Spent on Black Women Junior Managers 1 2.50%

Spent on African Junior Managers 1 4.32%

Spent on Black Non-management staff 2 8.00%

Spent on Black Non-management staff 1 4.00%

Spent on African Non-management staff 1 6.92%

Spent on Black Unemployed People 4 1.5%

Spent on Black Disabled People 1 0.30%

Learnerships: Black People in Learnerships (Employed or Unemployed) 4 5.00%

Bonus Points: Number of previously unemployed black people absorbed by the ME and industry at end of Learnership programme

3 100%

TOTAL SCORE 20 + 3

Banks and Life offices, Short Term Insurers, Stock Exchanges and Stock Exchange Members and Other Institutions

1515

2.1 ICT Sector Code

INFORMATION AND COMMUNICATION TECHNOLOGY (ICT): 20 + 5 points

DescriptionAMENDED ICT & Agri

Weighting Target

% Skills spend on Black People 8 6%

% Skills spend on Black disabled People 4 0.3%

% Learnerships 4 2.5%

% Unemployed Learnerships 4 2.5%

Bonus points: Absorption 5 100%

TOTAL SCORE 20 + 5

1616

2.1 Property Sector Code

SKILLS DEVELOPMENT – PROPERTY SECTOR Weighting Target

Skills Development Expenditure on Learning Programmes for black people as a percentage of leviable amount

8 5%

Skills Development Expenditure on Learning Programmes, for Black people with disabilities as a percentage of leviable amount

3 0.3%

Number of black employees participating in Learnerships, Apprenticeships and Internships as a percentage of total employees

4 2.5%

Number of black unemployed people participating in Learnerships, Apprenticeships or Internships as % of all employees

4 2.5%

Bonus Points: Number of Unemployed Black People absorbed by the ME and industry at end of Learnership, Apprenticeship or Internship programme

3 100%

TOTAL SCORE 19 + 3

1717

Description

AMENDED CONSTRUCTION

CONTRACTORS BEPs

Weighting Target Weighting Target

% Skills spend on BP (no ARG used) 7 2% 7 2%

Skills spend on African People (based on EAP) as % of total Skills spend on Black people using ARG

2 78.8% 2 78.8%

Skills spend on B Executive, SM and MM as % of total Skills spend on Black people using ARG

3 15% 3 15%

Skills spend on B JM as % of total Skills spend on Black people using ARG 1 10% 1 10%

Bursaries or Scholarships BP as % of total Skills spend on Black people using ARG 4 15% 4 15%

Number of Black people on Cat A/B/C or D programmes as % of all Employees using ARG 4 2.5% 4 2.5%

Number of Black employees registered as candidates with industry bodies as % of all such registered employees

4 60% 4 60%

Number of Black people with Disabilities registered on Cat A/B/C or D programmes as a % of all black office based learners on those programmes

1 5% 1 5%

Mentorships: Implementation of an approved Mentorship Program 3 Yes 3 Yes

Bonus points: Absorption 1 100% 1 100%

Bonus points: Black Employees registered as professionals with industry professional bodies as % of all Employees registered in measured period

4 60% 4 60%

TOTAL SCORE 29 + 5 34 + 5

2.1 Construction Sector Code

18

Salaries of employees on

Learnerships, Apprenticeships

& Internships

Accommodation, catering

& travel (capped at 15% of total

training) Admin costs i.e training

department operational costs

Scholarships & bursaries• Course fees

• Training materials

• Trainers

• Training facilities

Legitimate

Training

Costs

2.2 Legitimate training costs

School fees

Training manager/SDF costs (capped at 15% of total training)

19

2.3 Key Considerations

• 40% priority requirement:

– Require 8 out of 20 points to avoid a BEE level penalty

• Costs that are capped:

– Category F & G (informal workplace) training: Although capped at 25% of all training spend, but can still count 100% if below the 25% limit

– Training costs relating to accommodation, travel and catering is capped at 15%

– Claim for a Costs for SDF or training manager now limited to 15%

– FSC: Only cat. G capped at 15%

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• Learnerships, Apprenticeships & Internships:

– A trainee tracking tool to be developed to claim the bonus points.

– Salaries/stipends of Learnerships included for period of programme

– Head count may double-count into next financial period if overlap

• Leviable amount 4-month payment holiday as Covid-19 allowance

– This allowance does not affect Skills targets

– Companies must still base Skills targets on 12-month Leviable Amounts

21


• Disabled People:

• Section 1 of the Employment Equity Act defines people with disabilities as follows:

– A person who has a long-term or recurring physical or mental impairment which substantially limits his or her prospects of entry into, or advancement in, employment.

– Key question: Does the company accommodate the individual in the workplace due to his/her disability?

• Pending changes to Sector Codes:

– All sector Codes are required to align to the Generic Code amendments of 2019

– Be aware of possible impact on your scorecard

22

Impact of EAP Targets


TotalAfrican

male

Coloured

Male

Indian

Male

White /

Foreign

Male

African

Female

Coloured

Female

Indian

Female

White

/Foreign

Female

National EAP Target 100% 42.70% 5.20% 1.70% 5.10% 35.80% 4.40% 1.10% 4.00%

Adjusted EAP Target 100% 46.97% 5.72% 1.87% 39.38% 4.84% 1.21%

EAP Targets

If more than 50% of employees are based in one province, then the EAP targets of that province is applied

TotalAfrican

male

Coloured

Male

Indian

Male

White /

Foreign

Male

African

Female

Coloured

Female

Indian

Female

White

/Foreign

Female

Skills Spend on black people 3.50% 1.64% 0.20% 0.07% 1.38% 0.17% 0.042%

Bursaries for Black Students at

Higher Education Institutions2.50% 1.17% 0.14% 0.05% 0.98% 0.12% 0.03%

Number of black people on

learnerships, apprenticeships

and internships

5.00% 2.35% 0.29% 0.09% 1.97% 0.24% 0.06%

Skills Scorecard Targets

2323


Absorption:• “means a measure of the Measured Entity’s ability to successfully secure a long-term contract of

employment for the Employee, Learner, Intern or Apprentice.”

• The following therefore applies:

– A person who does not have a current long-term contract of employment;

– Completing a Learnership, Apprenticeship or Internship via the Measured Entity; and

– Upon completion, secures a long-term contract of employment as defined with either the Measured Entity or any entity within the Industry.

• FSC: “if an employed learner is moved into another position and their previous employment is thereby rendered vacant to be occupied by someone, then this can be counted as absorption.

Long-term contract of employment:

• “A legal agreement between an individual and an entity that this individual would work for until his or her mandatory date of retirement”

24


Application of the Absorption rules:

• Changed interpretation in terms of measurement against the target (as SANAS).

• Historically:

o 100% target based on 100% absorption of unemployed learnership who completed course

• Latest SANAS interpretation:

o 100% of the 5% headcount target for learnerships

o Target for 5 points = 100% x No. of Employees x 5% (target of Learnerships)

o Certain Sector Codes still have 2.5% target

2525

POLL

Do you believe the current Seta learnership programmes are effective in creating new job opportunities in South Africa?

1. Not at all

2. Limited impact

3. Significant impact

4. Very effective

2626

3. A Closer Look Learnerships, Apprenticeship and Internships

2727

3.1 Learnerships, Internships & Apprenticeships

Cat. Programme Narrative Description Delivery Mode Learning Site Learning Achievement

B Internships

Institution-based theoretical instruction as well as some practical learning with an employer or in a simulated work environment – formally assessed through the institution

Mixed mode delivery with institutional instruction as well as supervised learning in an appropriate workplace or simulated work environment

Institutions such as universities and colleges, schools, ABET providers and workplace

Theoretical knowledge and workplace experience with set requirements resulting in the achievement of a degree, diploma or certificate issued by an accredited or registered formal institution of learning(eg. Technical colleges, degrees with practical requirement)

CInternships / Articles

Recognised or registered structured experiential learning in the workplace that is required after the achievement of a qualification – formally assessed by a statutory occupational or professional body

Structured learning in the workplace with mentoring or coaching

Workplace

Occupational or professional knowledge and experience formally recognised through registration or licensing(eg. CA, CFA, Construction industry professional registration, where articles are required before registration)

DLearnerships or Apprentice-ships

Occupationally- directed instructional and work-based learning programme that requires a formal contract – formally assessed by an accredited body

Institutional instruction together with structured, supervised experiential learning in the workplace

Institution and workplace

Theoretical knowledge and workplace learning, resulting in the achievement of a South African Qualifications Authority registered qualification, a certificate or other similar occupational or professional qualification issued by an accredited or registered formal institution of learning(eg. NQF 2, 3, 4, etc. qualifications)

2828

3.2 National Qualification Framework (NQF)

2929

3.3 Learnerships

What is a learnership?• “A learnership is a work based learning programme that leads to an NQF registered qualification. Learnerships are directly related

to an occupation or field of work, for example, electrical engineering, hairdressing or project management. Learnerships are managed by Sector Education and Training Authorities (SETAs).”- SAQA

• “Learnership means a learning programme which—

- (i) consists of a structured learning component; the learnership includes practical work experience of a specified nature and duration;

- (ii) the learnership would lead to a qualification registered by the South African Qualifications Authority and related to anoccupation; and

- (iii) the intended learnership is registered with the Director-General in the prescribed manner.” – Skills Development Act

Two types of learnerships1. Employed Learnerships (18.1 learnership)

2. Unemployed Learnerships (18.2 learnership)

3030

3.3 Learnerships

What is important to know before you embark on the learnership journey?

The following must be in place:

• ALL learnerships should be registered with the SETA

• Only use accredited service providers

• Learnership agreement MUST be in place

Think about:

• Before you embark on the journey of Learnerships, you need to ask yourself WHY you are going the Learnership route

• Who will source the Learners? The company or Recruitment Agency?

• Are you going to apply to be the Lead and Host Employer or not

• Have you done research and understand how to claim for tax incentives and subsidies?

3131

3.3 Learnerships: Overview of tax allowances

Company tax - Section 12h

A Maximum of R 80 000 per learner per year if able bodied. (*Over 2 years)

A Maximum of R 120 000 per learner per year if disabled. (*Over 2 years)

PAYE ETI (Non taxable)

R1000 p/m PAYE deduction

*Over 2 years means:

▪ Year 1 – (50%) Annual allowance (Pro-rata payment)

▪ Year 2 – (50%) Completion allowance upon completion

▪ Corporate tax rate currently 28%

3232

3.4 Importance of tax allowances

Costs Before Tax Costs After Tax

Initiatives that Leverage ETI and 12H 10,000,000 610,975

Initiatives that don’t 10,000,000 7,200,000

Savings in after tax costs 92%

The above is presented for illustrative purposes based on an actual example

Only applies to learnerships that comply with the Receivers criteria

3333

3.4 PAYE TAX ALLOWANCES BURSARIES – STAFF FAMILY MEMBERS

Section 10(1) (Q)Relatives the definition

Amendments to 10(1)Q under discussion

‘relative’-

In this Act, unless the context otherwise indicates-

“relative” in relation to any person, means the spouse of such a person or

anybody related to him or his spouse within the third degree of consanguinity,

or any spouse of anybody so related, and for the purpose of determining

relationship between any child referred to in the definition of “child” in this

section and any other person, such child shall be deemed to be related to its

adoptive parent within the first degree of consanguinity;

Detail LimitsEmployee: Remuneration in previous year R600 000Learner: Grade R-12 R 20 000Learner: NQF 5-10 R 60 000Number of beneficiaries per taxpayer None

3434

3.4 Illustrated potential impact on employees

Example 1: Thabo and his wife Sally have three kids, two in high school and one enrolled atuniversity. Thabo earns R550 000 per year and Sally R300 000 per year respectively. Assume they have no other tax deductible expenses.

Reduces Leviable amount, targets and SDL

If staff family member is black, whether it counts must be considered on a case by case basis

Thabo Without Allowances With Allowances

Total Gross Salary R550 000 R550 000

Bursary andscholarship benefit

R0R100 000(2xR20 000 + 1xR60 000)

Taxable income R550 000 R450 000

Effective tax rate 24.0% 21.3%

Tax R131 808 R95 808

Potential saving R36 000

Sally Without Allowances WITH ALLOWANCES

Total Gross Salary R300 000 R300 000

Bursary and scholarship benefit

R0R100 000(2xR20 000 + 1xR60

000)

Taxable income R300 000 R200 000

Effective tax rate 16.1% 11.1%

Tax R48 265 R22 265

Potential saving R26 000

3535

4. The impact of changing rules

36

4.1 The impact of changing rules Negative

Issues of NotePositive

• Positive impact on this scorecard, as more

entities prefer funding school going students,

which was mainly limited to SED.

• Could result in potentially higher compliance

costs.

• Impact of salaries of learners would be less

in getting the full points as it is not applicable

to bursaries for higher education.

• Will add to scorecard points

• Will incentivise sponsors to pay stipends beyond just a

bursary

Stipends on Bursaries are Legitimate Training

Expenses

• Not capped previously and points will be

negatively impacted.

Spend on SDF or Training Manager,

accommodation, catering & travel

capped at 15%

Impact

of

Change

School fees now allowed to count under Skills

Development Split spend between Bursaries and all spend

37

4.1 The impact of changing rules strategyNegative

Issues of NotePositive

• Cat F & G now capped at 25% from 15% on all

spend which can assist to have to have internal

training making a bigger points contribution.

• 12 months contracts are no-longer eligible for

absorption given the new definition discussed

above.

• Re-enrolment on further studies no longer

eligible

• More effort will be required to ensure learners

can be employed permanently after

completion

• Previous interpretation made it easy to achieve

5 bonus points if all unemployed learners are

absorbed.

• Significantly more difficult now

Absorption target is 5% of head count

Impact

of

Change

Cat F & G 25% cap Absorption: Long term contract & further studies

38

4.2 Impact on other sectors

Absorption definition change

Raised Limit on informal training from 15% to 25%

Impact on sector codes reverting to ACOGP for measurement principles:

• Agri: absorption defined (p.65)

• Construction: absorption defined (p.443)

• Forestry: absorption defined (p.106)

• FSC: absorption defined (p.323)

• ICT: not defined (refer ACOGP)

• MAC: absorption defined (p.67)

• Property: absorption defined (p.56)

• Tourism: absorption defined (p.103)

• Transport: n/a"


• Agri is silent (7.4.3 of Code 300 refers to principles in ACOGP)

• MAC is silent (refer ACOGP)

• Property is silent (refer ACOGP)

• Construction explicitly different (35%)

• Forestry explicitly states 15%

• FSC explicitly states 15%

• ICT explicitly states 15%

• Tourism explicitly states 20%

39

4.2 impact on other sectors


• Agri (7.4.3 of Code 300 refers to principles in ACOGP)

• Construction is silent (refer to ACOGP)

• MAC is silent (refer ACOGP)

• Property is silent (refer ACOGP)

• Forestry explicitly only Accom, Catering & Travel

• FSC explicitly only Accom, Catering & Travel

• ICT explicitly only Accom, Catering & Travel

• Tourism explicitly only Accom, Catering & Travel

Amended Code 300: par 5.4

Added training manager , training facilitator ,

accommodation, catering & travel "and the cost to the M.E

of employing a Skills Development facilitator or a

training manager” to the 15% limitation.

4040

5. What are your Skills goals: Real Impact vs Scorecard Compliance

41

5.1 Scorecard Compliance vs Real Impact

Description More Compliance Focus More Impact Focus

Short courses –

accredited training

• Achieve Rand value targets

• Achieve optimal points with

minimal spend

• Less planning to align training

spend to Skills gaps within

workforce

• Achieve Rand value targets, but all training

is motivated by a clearly identified skills

needs

• No spend is taken on if it will not make a

difference to the wellbeing of the

individual and the Company

• Can we shift from a Compliance focus towards a more Impact focus while still getting our scorecard points?

• Lets not get fixated on scorecard points.

42

5.1 Real Impact vs Scorecard Compliance

Description More Compliance Focus More Impact Focus

Unemployed

Learnerships

• Easier route of offsite hosting with

company and not significantly

involved in selection process.

• Programmes of unemployed

learners not matched to

Company requirements – more

focused on spending the Rand

value

• Key focus is not on absorption

• Attempt to host all or some unemployed

learners at the Company

• Close involvement with screening and

selection process

• Programmes selected to alignto skills needs

of Company where possible

• Objective is to absorb unemployed

learnerships either at the Company or assist

with employment elsewhere

Bursaries • Provided as a last minute option to

achieve points shortage

• Planned spend to fill future skills gap with

longer term objective to employ

candidates

• Clear bursary policy and selection process

4343

POLL

How would you describe your company’s Skills Development approach?

1. Mostly scorecard points focussed

2. Mostly impact focussed

3. Combination of the two

4444

6. Impact Strategy Options that make Business Sense

45

6.1 Impact strategy options

Starting point:

• Identify skills gaps within company: What do we have & what do we need within 1 yr, 2-3 yrs, 3yrs+. This should be detailed exercise across divisions, and before new year starts.

• Match the Skills budget to required training as well as personal development plans of employees – all training should have an objective in mind.

• What is the shared value that can be created to benefit both Company and employees.

1. Unemployed Learnerships

• Can be hosted internally or externally – internal option could have bigger impact.

• Usually cat. D learnerships registered via Seta, or cat. B technical type qualifications

• Be involved with selection process in order to align to skills needs as well as select motivated learners.

• Objective should be to absorb majority of unemployed candidates and earmark employed learners for higher management levels

Shared value is a business strategy designed to solve social issues profitably.

46


• In terms of compliance points:

Current year

Current year

Next year


Skills Development Expenditure on Learning Programmes specified in the Learning Programme Matrix for black people as a percentage of Leviable Amount.

6 3.5%

Skills Development Expenditure on Bursaries for Black Students at Higher Education Institutions

4 2.5%

Skills Development Expenditure on Learning Programmes specified in the Learning Programme Matrix for black employees with disabilities as a percentage of Leviable Amount

4 0.3%

Number of black people participating in Learnerships, Apprenticeships and internships as a percentage of total employees.

6 5%

Bonus Points: Number of black people absorbed by the Measured and Industry Entity at the end of the Internship, Learnership and Apprenticeship

5 100%

TOTAL SCORE 20 + 5

Current year

47


2. Bursaries for Black Students at Higher Education Institutions

• Identify high potential candidates at 2nd & final year studies.

• Try to match selection of candidates with company culture with objective of future permanent employment.

• Incentivise through bursary as well as future career with the company.

• Where possible convert completed studies into a professional learnerships – especially in Financial & Construction sectors.

3. Bursaries at school level with longer-term view

• Objective: Provide longer term support through school, varsity/college and then employment.

• Require number of years commitment, but will make real impact.

• Can allocate to either Skills or SED.

48


4. Disabled training

• 1st option: Develop disabled employees internally if you have disabled people.

o Internal awareness programme can assist to have more people declare their disabilities.

o In this way a better workplace can be created for individuals who did not want to declare previously.

• 2nd option: Use unemployed learnerships to enrol disabled candidates who will be regarded as employees during the 12 month programme.

o Objective should be to absorb these learners, and not just yearly solution.

o Challenge remains around absorption of disabled people – very low absorption rates.

49


5. Align Skills spend with Leadership succession planning

• Cases with a shortage of black representation at Senior & Executive Management

• Identify high potential candidates at junior or middle management levels

• Plot a career path & personal development plan which is supported by focussed skills programmes (eg. MDP, MBA, etc.)

• Serves as motivation for candidates (“I have a future with this company”) and helps to retain high potential employees

• Look for opportunities to claim for cat. B or C learnership programmes

o E.g. degrees, diplomas with a practical workplace requirement, or profession al registrations

50


6. Establish an inhouse training academy

• Two options:

1. Establish new academy

– Accreditation is long and onerous

– Can use this as part of ESD strategy

– Provide entrepreneurial opportunities for existing staff

2. Take over existing accredited academy

– Buy existing capacity, expertise and accreditations

– Easier route

– Does not have to be 100% ownership – can be partnership.

51


6. Establish an inhouse training academy

• Advantages:

• All operational costs count as valid training spend

• Control content of programmes

• Opportunity to convert inhouse programmes to certified

• Use more cost effective internal expertise

• Disadvantages:

• Initial cost high

• Significant resources & effort required to maintain

52


7. Covid strategy: Online solutions

• Find suitable online partner to:

• Convert existing inhouse programmes

• Provide new courses

• Challenge: Can we successfully run learnership programmes online with limited access to workplace

• Important: Employees need to buy-in and not just register because they have to

• Can result in significant costs saving which can then be applied to other areas required

5353

7. YES INITIATIVE

54

A Large entity needs to achieve at least 40% of the priority elements’ points.

Why do we have YES?

• To make provision for unemployed young people who need to be trained and employed by corporates and SMMEs.

• This can occur by way of learnership programmes, bursaries and accredited or non-accredited training courses for a 12-month period.

• Company benefit: Opportunity to move up• 1 B-BBEE level• 1 B-BBEE level + 3 bonus points• 2 B-BBEE levels up

7.1 Youth employment service (YES)

55

• ME to achieve at least a level 8 before YES BBBEE recognition is rewarded• Measured entities maintain or improve their B-BBEE status level from the year before. • Youth must be employed on a 12-month, fixed term employment contract.• Absorption can only occur after the 12-month period.• Initiatives for YES are separate from learnerships, internships and apprenticeships – no double

counting.• Sponsored host placements are a part of the YES programme. Corporates who meet their YES

target can choose to place the youth in their own business or at a host SMME through a sponsored host placement, at no cost to the host.

7.1 Youth employment service (YES)

56

7.2 YES: Calculate targets

The targets for YES are calculated as follows – the highest of:

• 1.5% of headcount; OR

• 1.5% of average NPAT in the immediate preceding 3 years / R55000 (to convert to headcount); OR

• Target as per the table below:

TOTAL REVENUE BAND (RM) MINIMUM BLACK YOUTH JOBS

50 – 75 6

75 – 99 7

100 – 149 8

150 – 199 9

200 – 249 10

250 – 299 11

300 – 349 12

350 – 399 13

400 – 449 14

450 – 500 + 15

BEE Recognition

Achieve YES target and 2.5% absorption 1 Level up

Achieve 1.5xYES target and 5% absorption1 Level + 3

bonus points

Achieve double YES target and 5% absorption 2 Levels up

5757

7.3 YES: Practical example

(1) 1.5% of headcount 96 employees 1.44

(2) 1.5% x NPAT / R55 000 1 302 434.18 23.68

average NPAT x 1.5%:

2018 2017 2016 3year ave

127 084 000.00 51 322 000.00 82 080 836.00 86 828 945.33

(3) Target as per table:

TOTAL REVENUE BAND (RM) MINIMUM BLACK YOUTH JOBS

50 – 75 6

75 – 99 7

100 – 149 8

150 – 199 9

200 – 249 10

250 – 299 11

300 – 349 12

350 – 399 13

400 – 449 14

450 – 500+ 15

15.00 3 836 294 000.00

TARGET CALCULATION | Higher of:24 Learners required to achieve YES target

5858

8. Q&A

More questions?

[email protected]@apros.co.za

[email protected]

www.alternativeprosperity.com

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6.1 Practical example: Learnership route

• No of employees: 50

• Leviable amount: R15m per year

• Budget: <R500,000


Skills Development spend on Black People as a % of leviable amount

6 3.5%

Bursaries for Black Students at Higher Education Institutions (and Basic Education) as % of Leviable amount

4 2.5%

Skills Development spend on Black Disabled Employees as % of Leviable amount

4 0.3%

Black Learnerships participating in Learnerships, Apprenticeships or Internships as % of all employees 6 5%

Bonus Points: Number of Black People absorbed by the ME and industry at end of Learnership programme

5 100%

TOTAL SCORE 20 + 5

R900k spend required

2.5 Learnerships required

R375k spend required

R45k spend required

To achieve full points

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• Budget: <R500,000

Description Weighting Target Actual Spend Points


6 3.5%(R525k)

R80k x 4 = R320k(Achieve 2.1%)

3.16


4 2.5%

(R375k)

R100k bursaries(AM, AF)

0.92


4 0.3%(R45k)

R80k1x disabled

learner4.00

Black Learnerships participating in Learnerships, Apprenticeships or Internships as % of all employees 6

5%(2.5 Learners)

4x unemployed learners

(2xAM, 2xAF)5.18


5 100%Absorption in following year

TOTAL SCORE 20 + 5 R420k 13.26

1st Objective: Meet priority requirement (8 points)2nd Objective: Optimise pointsOption: Enroll 4 learnerships

62

EAP Targets

6.1 Practical example

TotalAfrican

male

Coloured

Male

Indian

Male

White /

Foreign

Male

African

Female

Coloured

Female

Indian

Female

White

/Foreign

Female






and internships

5.00% 2.35% 0.29% 0.09% 1.97% 0.24% 0.06%


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6.1 Practical example

Description Weighting Target Spend Points


6 3.5% R80k x 4 = R320k(Achieve 2.1%)

3.16

TotalAfrican

male

Coloured

Male

Indian

Male

White /

Foreign

Male

African

Female

Coloured

Female

Indian

Female

White

/Foreign

Female


Skills Spend on black people 320,000 150,319 18,306 5,985 126,029 15,490 3,872

Actual spend 160,000 160,000

Points achieved 3.16 1.72 - - 1.44 - -


64

Practical example



5%(2.5 Learners)


(2xAM, 2xAF)5.18

TotalAfrican

male

Coloured

Male

Indian

Male

White /

Foreign

Male

African

Female

Coloured

Female

Indian

Female

White

/Foreign

Female



and internships

5.00% 2.35% 0.29% 0.09% 1.97% 0.24% 0.06%

Headcount required 2.5 1.17 0.14 0.05 - 0.98 0.12 0.03 -

Actual headcount 2 2

Points achieved 5.18 2.82 - - 2.36 - -

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Practical example

Description Weighting Target Spend Points


4 2.5%R100k bursary

(Achieve 0.67%)0.92

TotalAfrican

male

Coloured

Male

Indian

Male

White /

Foreign

Male

African

Female

Coloured

Female

Indian

Female

White

/Foreign

Female



Skills Spend on black people 100,000 46,975 5,721 1,870 39,384 4,840 1,210

Actual spend 50,000 50,000

Points achieved 0.92 0.50 - - 0.42 - -

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• Budget: <R500,000



6 3.5%(R525k)

R80k x 4 = R320k(Achieve 2.1%)

3.16


4 2.5%

(R375k)

R100k bursaries(AM, AF)

0.92


4 0.3%(R45k)

R80k1x disabled

learner4.00


5%(2.5 Learners)


(2xAM, 2xAF)5.18


5 100%Absorption in following year

TOTAL SCORE 20 + 5 R420k 13.26

1st Objective: Meet priority requirement (8 points)2nd Objective: Optimise pointsOption: Enroll 4 learnerships

welcome… · 2020. 9. 10. · national eap target 100% 42.70% 5.20% 1.70% 5.10% 35.80% 4.40% 1.10%...

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