Workplace Skills Planning and Training

Only a few days remain until 30 April 2019 – the final date on which South African employers can submit their Workplace Skills Plan (WSP) and Annual Training Report (ATR) to their respective Skills Education Training Authority (SETA).

CRS Technologies, a leader in HR and human capital management solutions, also points out that employers with a total salary bill of R500 000+ over a 12-month period are required to pay SDL levies to SARS every month.

SARS distributes these fees to the respective SETAs which, in turn, allocate the fees to grants.

SETAs offer mandatory grants to employers investing in their employee development, while discretionary grants are awarded to develop scarce skills.

This is where CRS can – and does – make a difference, by helping employers secure a return on the investment in their employees.

Nicol Myburgh, who heads up the HR business unit at CRS Technologies, says the company is ideally positioned to help businesses submit their SETA reports and ensure that they benefit from the process.

“The submission process is complex and requires a meticulous approach to gathering and applying information,” says Myburgh.

”The relevant legislation is extensive and must be carefully considered when compiling the workplace skills plan and annual training report. This is where CRS Technologies can assist clients in understanding the legislation and its impact, and advise them on the best practice process to compliance.”

Compliance with SARS and SETA regulation is mandatory and while Myburgh advises a careful and attentive approach, he also recommends enlisting the services of an experienced and knowledgeable partner on board for the best results.

Online submission of PAYE returns through the Integrated Tax Administration System (ITAS) Portal Following the press release issued by the Ministry of Finance early January 2019 to notify taxpayers of the online submission requirements pertaining to the new Integrated Tax Administration System (ITAS), another press release was issued on 19 April 2019.

The submission of monthly employee tax (PAYE) returns is expected to be lodged online, through the ITAS portal as from March 2019. The online submission is done by completing an Excel spreadsheet with detailed payroll information of employees and upload it on ITAS.

The Ministry was informed that some employers are not ready to submit their PAYE returns electronically due to the need to adjust their payroll systems in order to be compliant with the ITAS requirements.

It was agreed that affected employers may submit their monthly PAYE returns manually until September 2019. Thereafter no manual submissions for PAYE will be accepted.

Employers opting to submit their returns manually must take note that they are obliged to update all manual submissions by uploading electronic versions on ITAS by September 2019.

The deadline for submission and payment remains the 20th of every month.

Contact our legislation team at info@crs.co.za if you require any additional information.

© 2019 CRS Technologies (Pty)Ltd. All Rights Reserved.

The digital transformation of payroll services has changed the way companies approach this integral back-office function. According to Ian McAlister, General Manager of CRS Technologies South Africa, specialised compensation and remuneration services can help with this transition.

Already, the automation of manual-intensive processes in payroll departments has resulted in staff being refocused on delivering more strategic value to an organisation.

“By taking away much of the admin-intensive functions, automation is giving people more time to review the data at their disposal and develop solutions for customers accordingly. When it comes to payroll, this value can be derived by empowering staff to develop more skills for a digital-friendly environment,” he says.

In certain respects, this more process-centric way of approaching payroll has resulted in a variety of apps and self-service tools emerge empowering organisations to do more with the technology at their disposal.

“Additionally, companies need to find increasingly innovate ways to structure compensation packages. Incentives will be driven by outcomes-based performance instead of the traditional fixed structure of either a 13th cheque, share options, and the like.”

But automation and compensation packages are just two components of a new digitally led payroll environment.

Part of the new digitalisation of payroll entails outsourcing non-core activities (think payroll administration) to specialists as a way of further improving efficiencies and reducing operating expenses. Furthermore, using the right provider, these outsourced solutions still leave the business in a position to manage and plan payroll costs, secure employee benefits, and avoid spending money on purchasing new payroll technology (this is especially relevant to cloud-based solutions that are continually updated).

“Typically, an outsourced service provider should be able to process wages and salary payrolls weekly, fortnightly or monthly. Part of this entails processing confidential and electronic payslips as well as making electronic payments to PAYE (Pay As You Earn), UIF (Unemployment Insurance Fund), and SDL (Skills Development Levy).”

Such a trusted partner would be able to manage any submissions to SARS and assist with package restructurings and any other statutory registrations.

“We live in a time where specialised payroll consultants can add immense value to any business. Their understanding (and likely innovation) of how technology is impacting these processes can fundamentally change how a business approaches this mission-critical function,” McAlister concludes.

Please feel free to contact us or visit our website for more information on taking your payroll into the digital future.

Health and safety continues to have a strong focus in the local mining sector with accidents and illegal activities continuing to be of concern. However, beyond this, how has health and safety expanded into other sectors in the market?

For one, evolving technology has enhanced the ability of the health and safety officer to fulfil their role. There is a strong administrative component in health and safety that can now be linked to productivity solutions and automated to some extent.

But it is not just about technology. Even though HR is involved with health and safety to a limited extent, it is rather a resource to be used. This is especially relevant in terms of participating in a safety committee and often being involved in the safety structure and the provision of protective clothing and the like. However, it is up to each organisation to define to what extent HR is involved in this process.

Even though health and safety, to a certain extent in non-industrial organisations, was viewed as a ‘necessary evil’, this has changed. In South Africa, there is a growing culture of safety awareness. Often, health and safety is paired with quality environmental matters. This results in the appointment of a SHEQ (Safety, Health, Environment, Quality) officer or a SHE (Safety, Health, Environment) officer.

Adding impetus to this is a massive increase in the awareness of environmental issues amongst the younger generations, particularly when it comes to climate change. This has a spinoff in creating a mindfulness in organisations when it comes to health and safety and any associated environmental issues.

After all, employees have a massive influence on practical health and safety. They have a duty to work in a safe manner. If they do not, they may be disciplined. If misconduct in respect of safety matters is of a gross nature, they may be dismissed.

An example in an industrial organisation would be if a machine-minding employee sleeps while the machine runs. This is seen as gross misconduct and often takes place where employees are required to work night shifts. Where employees effectively do their jobs in a safe manner daily, they ensure safety in the workplace. Where they are negligent, they may create a safety hazard.

All told, health and safety will remain integral to the success and growth of any organisation irrespective of size and industry. How it chooses to approach it, remains up to the decision-makers.

NHDF Implementation

As part of the Finance Act 2018, assented by Kenya’s President on 21 September 2018, the Employment Act 2007, was amended to introduce contributions to the National Housing Development Fund (NHDF).

The NHDF contributions were meant to come into effect 1 January 2019, however, it was temporarily suspended by the Labour Court, pending discussions between workers and the government.

On 16 April 2019, a public notice was published on the Kenya Revenue Authority website informing employees and employers that the Housing Fund Levy has come into effect.

Both the employer and the employee must each contribute 1.5% of the employee’s monthly basic salary.  The combined contribution is capped at KES 5,000 per month.  Voluntary contributions may also be made to the scheme at a minimum of KES 200 per month.  The first contribution will be due by 9th May 2019. Information relating to the payment process still to be communicated.

Every employer must register with the Housing Fund as a contributing employer and must also register his/her employees as members of the Housing Fund.

Despite the notice, the Federation of Kenya Employers’ (FKE) asked employers not to implement the policy as directed by the Housing ministry and the Kenya Revenue Authority.  The FKE attended court on April 8, 2019, and obtained an order suspending the implementation of the levy until May 20, when the case will be mentioned.  The FKE said the Gazette is therefore unlawful.

It is our recommendation that employers register the company and their employees with the Housing Fund and make the necessary adjustments to their payroll systems as heavy penalties could be inflicted.  Should the Housing Fund Levy be suspended for a further period, an update will be distributed.

 

Contact our legislation team at info@crs.co.za if you require any additional information.

© 2019 CRS Technologies (Pty)Ltd. All Rights Reserved.

Companies must ensure their human resource (HR) policies and procedures reflect South Africa’s multi-cultural society, especially when it comes to the religious beliefs of their employees, declares Nicol Myburgh, Head of the Human Resource Business Unit at CRS Technologies.

“This is very important not only as a moral imperative or to comply with labour legislation, but because religious freedom and protection is a constitutional right. From a labour perspective, employees are protected under the Employment Equity Act, which states that no person may unfairly discriminate against an employee in any employment policy or practice on several grounds, including religion.”

“Companies must be careful not to unfairly discriminate against any employee on the grounds of their religion,” Myburgh continues. “Even if this happens accidentally, such as by enforcing a dress code or denying leave on a religious holiday, the employer could be found to be in breach of the Constitution.

Consequently, it is imperative that HR policies and procedures make provision for their employees’ religious beliefs and practices. Additionally, during the development of an Employment Equity plan, these policies and procedures must be tested for potential barriers to equity and the plan must provide a timeframe for the correction of these barriers.

Financial impact

“Organisations face severe financial risk if they discriminate unfairly based on religion,” says Myburgh.

In one case, an employee was dismissed for refusing to work on a Saturday (as it was considered the Holy Sabbath) when the company scheduled stock taking on the day. The Labour Appeal Court found that the dismissal was automatically unfair and awarded the employee the equivalent of 12 months’ compensation for the dismissal.

At another organisation, employees were dismissed for not adhering to the company dress code by wearing dreadlocks. The argument was that some of them wore dreadlocks as part of their Rastafarian religion, while others wore them as a requirement of their Xhosa culture. The Supreme Court of Appeal held that the employees’ dismissals were automatically unfair on the grounds of discrimination relating to gender, religion, and culture.

“In other labour disputes, the compensation awarded is capped at 12 months, but when it comes to automatically unfair dismissal this goes up to 24 months if awarded by the CCMA.”

“If the case goes to the Labour Court, there is no prescribed limit,” Myburgh adds.

Best practice

There are a few considerations to keep in mind when it comes to dealing with religious leave so that it does not negatively impact those employees who are not religious.

An employer should ask the following questions:

  • Is the dominant reason for leave the employee’s religion?
  • Is it an inherent requirement of the job to work on that specific day?
  • Is the required task rationally connected to the performance of the job and reasonably necessary to the accomplishment of that purpose?
  • Would it be impossible to accommodate the employee without imposing undue hardship on the business?

“Through all of this, companies must be aware of the human element in the formulation of their policies,” says Myburgh.

“Policies that are too rigid or inflexible are not very effective in society today. They need to be of such a nature that they can accommodate for individual circumstances, while still being applied fairly and consistently.”

Technology permeates every aspect of business today. Even the more traditional people-centric processes of human resources (HR) and payroll have benefited from automation, machine-learning, and the like. The challenge lies in whether organisations can keep up with this rapidly evolving landscape, especially in a mobile-centric environment such as South Africa, declares Ian McAlister, General Manager of CRS Technologies South Africa.

Thanks to improved mobile connectivity, employees are starting to put pressure on organisations to give them more flexibility when it comes to their working location. While this has not quite reached the stage of complete telecommuting, spending the odd day working from home does translate into value-added benefits the employer can offer.

In such a dynamic new environment, HR and payroll integration is essential. But successful integration with existing business platforms such as enterprise resource planning systems and other bespoke solutions is not without its challenges. There will always be security considerations and availability concerns when such a transition takes place but, says McAlister, a willingness from management to embrace such a change generally results in a more positive environment in which to make the move. This also sees more resources committed to making the shift as smooth as possible.

“Realistically, not many organisations can lay claim to having completely mobile-friendly HR and payroll systems in place. This is where cloud-based platforms become increasingly important. Of course, there is a natural sensitivity around moving confidential information (such as employee records) into a public cloud environment. Fortunately, there are hybrid or private cloud offerings that can cater for a more mobile-friendly HR and payroll platform.”

Overcoming traditional HR & Payroll tech implementations

Traditionally, HR and payroll implementations were all about automating processes and storing data in a secure and accessible place. The strategy behind this was to work smarter to free up time for strategy. This meant the environment was very much bound by careful mapping and maintenance of data.

“In a way, this stifled innovation and out-of-the-box thinking. In South Africa, this mindset remains the foundation on which many HR and payroll strategies are still developed today. However, if decision-makers start factoring in an always-on way of thinking when it comes to data availability, things will start changing for the better.”

In fact, using big data and analytics as drivers for innovation in HR and payroll will see these strategies keep up with technology innovations.

“Embracing always-on technology that is intuitive and enhances the wellbeing of employer-employee relationships and workplace productivity will be a critical part of HR and payroll in 2019,” McAlister predicts.

Having employees that can continually access the work environment irrespective of their location will also result in improved engagement. This, in turn, will give rise to better service levels and create happier customers less likely to leave for competitors.

“So, while HR and payroll might seem like only about ticking boxes, the resultant technology innovations create ripple effects in the organisation far beyond those traditional views,” he concludes.

Contact us or visit our website for more information on how CRS can take your payroll into the digital future.

It’s hard to believe that Q1 is done. The Budget always seems to be an anchor and set the tone for business but right now there is a lot of fist shaking at Eskom and that’s setting an altogether different kind of tone! And, from an HR standpoint, it has to be managed too. Not everyone can run to generators so it comes down to getting Eskom-smart and doing things like moving meeting times and venues, changing workers’ shifts, lunch and tea breaks, re-thinking when and where to perform system backups, allowing ‘work from home’ days and so on. The knock on effect on the industry in just the last few weeks has been quite phenomenal and unfortunately, I think the problem is a long way off resolution. As HR professionals, it is just another South African’ism we have to adapt to and I would love to hear from you about the HR changes you have made to combat loss of productivity when the lights go out?  Do you have a ‘loadshedding’ operational mode that the entire organisation follows? What hasn’t worked for you as an HR department or C-Suite in the dark?

Going back to the Budget, it was quite conservative in my opinion without any drastic changes. There was something for everyone in it and, if followed through, will certainly help rebuild or at least stabilise the platform from which we are all trying to do business. CRS has also released its annual Tax Guide booklet. As usual, there has been a lot of interest in this and we have printed guides too. Drop us a line to order a hard copy or scroll down to find a link to the digital version.

As part of our greater knowledge sharing and skills development vision, I am pleased to share that CRS is partnering with local educational institutes in building their HR syllabus and related components. Starting with Nelson Mandela University, we contribute the professional HR input and vast experience needed to build a solid course or syllabus, and we’re looking forward to rolling out with other tertiary institutes in a similar role. Still on education, I am also pleased to welcome our new interns to CRS who, over the next four to six months, will be gaining exposure to all aspects of the business.

Lastly, I would like to draw your attention to the rise of something called social creditworthiness. This refers to accessing social media accounts/data as a means to profile or screen an individual for a variety of reasons including employment matters — and going far deeper than just a passive Facebook or LinkedIn search over lunch. If we thought we were uncomfortable in the current Big Brother society, this takes it to an all new level. Bad scores can even prevent one from buying things like airline or movie tickets. There are a number of areas of modern life that one can be locked out of if your social media activity is a bit sketchy. China is leading the world in this and, interestingly, the Chinese populous seems to be on board and welcome the accountability it creates. Here’s one article to read, Something to keep in mind for future talent searches.

Have a great month

Ian McAlister (ianm@crs.co.za)

Namibia Budget Speech Highlights

The Minister of Finance, Hon. Calle Schlettwein, presented the 2019 Budget Speech to Parliament on 27 March 2019.

  • The budget deficit is estimated at N$8.2 billion or 4.1% of GDP and averaging 3.4% over the Medium Term Expenditure Framework (MTEF).
  • Inflation remains stable at 4.4% in February this year, after averaging 4.3% over 2018.
  • Total revenue for 2019/2020 is estimated at N$58.4 billion, 3.0% better than the estimated outturn for 2018/19 and 29.7% of GDP.
  • Expenditure as a proportion of GDP reduced from 42% to 34.9% in FY2018/19.
  • Old age pensions are increased by N$50 to a monthly grant of N$1300.

The main Tax proposals include:

  • Phasing out the current tax incentive for manufacturers and exporters of manufactured goods, repealing the Export Processing Zone and introducing the Special Economic Zones, with a sunset clause for current operators with the EPZ status.
  • Introducing a 10 percent dividend tax for dividends paid to residents.
  • Subject income derived from commercial activities of charitable, religious, educational and other types of institutions under Section 16 of the Income Tax Act to normal corporate tax requirements.
  • Taxing all income earned from foreign sources. Namibian residents will have to declare such income in their annual tax returns.
  • Increase the tax deductibility of retirement fund contributions from the current N$40,000 per annum to 27.5% of income with a maximum of N$150,000 to encourage savings and provisions for retirement.
  • Disallow deductibility of fees and interest paid to non-residents for calculating taxable income until payment of withholding tax paid is proven.
  • Remove VAT zero-rating on sugar.
  • Disallow deductibility of royalties for non-diamond mining entities.
  • No changes in personal or corporate tax rates proposed.

 

Contact our legislation team at info@crs.co.za if you require any additional information.

© 2019 CRS Technologies (Pty)Ltd. All Rights Reserved.