June 2005

We are already in the last half of the year and as predicted it has been a very busy year for everyone with an economy that seems to be opposite to the rest of the world. At the moment we are very busy with Employment Equity and Skills development requirements, which appear to have had a new lease on life because of the current emphasis on BEE. News in the press indicates that the government is looking at ways to simplify the legislation that small and medium enterprises are required to comply with. We are not holding our breath as every indication is that it won’t change much.

The update is intended to remind you of the focus for this quarter and to introduce you to areas of HR interest.

1. Skills Development

The National Skills strategy was revealed 31 March 2005 and the Seta’s are in the process of releasing their strategies for the next 5 years. Training Reports for the 2004/05 training year are currently being submitted, but, with the exception of MAPP Seta all Workplace Skills Plans must be submitted in September 2005. This is for the Training year beginning on 1 April 2005 and ending on 31 March 2006.

The National Skills Development Strategy focused on the following:

• Funding for learners at all levels to obtain skills which their sector has determined as being scarce skills, e.g. Teachers of Mathematics and Science, Engineers, artisans etc.
• Funding the development of a guide to occupational trends for use by guidance counselors
• ABET (Adult Basic Education and Training). The aim is for 700 000 learners to have reached ABET level 4 by the year 2010.
• Learnership grants, bursary grants and internship grants for scarce skills as determined by the sector.
• Work experience grants for unemployed people to gain work experience.

There was a clear indication that skills development should be linked to BEE targets and to training of previously disadvantaged individuals. Quotas are likely to be introduced by the SETA’s from next year which will require company’s to spend up to 85% of their training budget on PDI’s.

The BEE scorecard indicates that by the year 2015 we should be spending 3% of our payroll on training each year.

Anyone who would like to apply for discretionary funding or implement learnerships in their workplace should contact Jane Alevizos at our offices.

2. The Case for Corporate involvement with employee health

There is an increasing concern within industry towards the social responsibility of Companies to provide wellness for their workforce. The other side of this is an equally valid concern about the cost of providing that care. The exact nature of what constitutes wellness for the employees is unclear, although occupational health, primary health and an HIV program have been acknowledged as key aspects. Indeed, the law imposes an obligation onto an employer in terms of Health & Safety and occupational health.

Aside from the business risk associated with breaking the law, various studies have been prepared that clearly recognise a business case for the provision of certain health services. The financial benefits of such health interventions extend to include direct employee morale and job satisfaction, reduced absenteeism, lower staff turnover and increased overall productivity. These savings can significantly impact on the firm’s bottom line.

Despite the business case for corporate involvement with health, less than 30% of companies have any kind of strategy in this regard. With specific regard to HIV, most South African employers are sticking their heads into the sand and ignoring the impending storm. With one of the highest incidence rates of HIV in the world, this failure to react borders on the insane. Not only will HIV involve the workforce of every organisation, but with so many people dependant upon each employed persons salary, the knock on effect on the economy is set to be huge. We are not talking of a minor “couple of percentage points” shrinking of the economy, we are talking instead of going backwards in economic growth. Possibly as much as twenty years.

Both the direct and indirect costs of doing business are going to increase dramatically over the next five years. Whether we like it or not someone has to pay the price.

We are finding increasing levels of absenteeism in the workplace and companies are experiencing difficulty in managing sick leave, family responsibility leave and unpaid leave levels and are working with HIVCare an organisation which aims to be the leader in holistic service delivery of HIV/AIDS management in Southern Africa and which specialises in the development and implementation of HIV/AIDS programmes tailored to specific industry sectors and individual businesses. For more information, contact Lynette at our offices:

3. Tax Issues

We have all just provided the Receiver of Revenue with our returns for the 2004/05 tax year (hopefully). However, employees should be reminded that all employees who earn more than R60 000-00 per year in the 2005/06 tax year or who receive any allowances which are determined to be fringe benefits, are required to complete a tax return. If they have received a tax return they must complete it. Please ensure that your staff of aware of this liability and apply for tax numbers accordingly.

We are all looking forward to the demise of the RSC levy which is destined to disappear next year.

4. Training and Development

We have been very pleased with the response to our public Leadership Development Programme. The first group will be completing their course at the end of August and will receive their assessments in September. There are a further three groups who began the programme during June, two in Johannesburg and one in Durban and a fourth group will be starting in August 2005.

The programme is designed to be very practical and to provide skills in dealing with the complexities of managing a modern workplace and working our way through the HR legislation which confronts us.

We have received accreditation for the Life Skills programme which is aimed at employees who are finding it difficult to navigate our complicated world. Topics covered include:

• Emotional Intelligence
• Debt Management
• Household budgeting
• Presentation skills
• HIV/Aids
• Basic Business skills – the concept of profit and loss

We believe the programme has value at all levels, but particularly for employees whose literacy level makes it difficult for them to read the fine print on that HP contract or who find that they are battling to cope with their garnishees.

5. Know Yourself

Your business success is more dependent on relationships with investors, staff, customers and suppliers, than on business transactions. We know that the difference between your business and your competitor is your people.

Research confirms that in order to improve relationships, we need to better understand ourselves as leaders and then get to better understand the strengths and aspirations and motivations of the people we work with.

We need to find effective ways to develop the strengths of our staff and motivate them towards achieving business objectives, both as individuals and team members and to work more effectively together.

The Personal Profile Analysis (PPA) can assist you in this task. By referencing to their personal profiles, individuals learn about themselves, and leaders can build on the identified strengths and channel them towards improved business success.

Team profiles are also useful to establish an awareness of team synergies, strengths and development needs, etc and to accurately diagnose the stresses that exist in the workplace.

6. The Secret of your Success

The secret of your success is you, your business ideas and the extent to which you can get people to support and align with you to reach and exceed the goals that you set.

You need to provide direction, vision, commitment and passion to model the behaviours which individuals and teams must follow. Whether conscious or not, this requires influencing people to share common goals, values and behaviours which work effectively towards achieving objectives set.

This needs to be supported by reinforcing the values and behaviours expected of employees in written policies and procedures. These provide the guidelines as to how things are to be done in the business. Staff must be also be clear on what is expected of them in terms job requirements.

With these guidelines in place, staff can be developed and corrected as necessary and can be instrumental in building a positive organization culture. In addition, they provide a framework for compliance, which protects the employer and the organization against disruptive, disloyal and counter productive behaviour.

This forms the basis of Corporate Governance. While ‘Corporate Governance’ may sound like a mouthful but its pretty basic stuff.

7. Effective Recruiting

With regards to recruitment, we are now proud to be partnered with CareerJunction, which is an online e-recruitment solution. This ensures new levels of speed, ease and efficiency from the time a full job specification is received to the successful placement of a candidate. Some of the benefits are as follows:

• One job advertisement can be placed for a period of 30 days for the same cost as a once off advertisement in the workplace classifieds. If needed for longer than 30 days the cost of the advertisement will be reduced on a sliding scale.
• Once a job advertisement is placed, it is also advertised on the career pages of other partner sites, at no extra cost. These include The Sunday Times, Business Day, Financial Mail etc.
• There are approximately 200,000 searchable resumes on the database to screen from.
• As soon as a new resume is entered onto the database that matches specific job criteria we will be alerted and can contact the candidate immediately.
• Reports can be extracted that will determine the success of the job advertisement by monitoring the number of views and applications that the job attracts.
• On-line competency profiling with Prof!ler. This facilitates the profiling of positions in terms of cognitive dimensions, competency dimensions (behavioural & functional) and motivational drivers, the combination of which represents the “inputs” required for success in any job. This is a system for measuring and assessing skills that employees have against the positions within quantifiable, consistent, scientifically verified and legally compliant framework.

Please contact Pleia Alberts, our Recruitment Consultant, on (011) 452-0146 hr@connold.co.za with regards to all your recruitment needs, about placing your advertisements online, and for more information regarding the benefits of CareerJunction.

8. Section 197 Transfers

Recent Labour Court decisions have determined that the definition of a business for the purposes of section 197 of the Labour Relations Act includes services such as cleaning, gardening etc. This means that if a company is contemplating outsourcing their cleaners to a contract cleaning provider or their gardener to a gardening service, they need to follow the provisions of Section 197 of the act and effectively transfer their employees to the new service provider.

This is obviously not such a simple exercise and the main reason for outsourcing is to have a cheaper more effective service. If you are required to transfer your employees on the same or similar conditions to those they enjoy in your employ, a cheaper service is unlikely.

When contemplating purchasing a business, it is important that a proper HR due diligence is carried out and that the sale agreement concluded spells out the provisions made for any payments due to employees, particularly leave pay, severance packages and any share provisions. It is also important to determine if there are any outstanding CCMA or Labour Court cases as these will be transferred to the new business owner. As with all labour law, the process is as important as the result. Consultation is essential.

9. Practical Guide to Human Resource Management

This guide, which is being published by Fleet Street Publications, is due to be published at the end of July. We are very proud to have contributed to the writing of this very useful manual, which will provide information on a wide variety of topics. The intention is that the guide will be updated every 6 – 8 weeks so the information will always be up to date and current.

10. Conclusion

The South African Board of Personnel Practitioners has submitted legislation to Parliament, which will result in a registration process becoming necessary if you wish to practice as a Human Resource Professional (similar to those in place for Chartered Accountants and the Legal Fraternity). All H R professionals are urged to investigate registration as once the legislation is passed you will have to pass the required examinations.

If you would like any information on how to approach this and any of the above issues please contact us for more information.