Glenda Daniels The tardiness of employers in registering and paying their skills development levy to get training going is behind their inability to meet affirmative action targets. While more than R100-million a month is rolling in to the South African Revenue Service (Sars), which gives the money to the Department of Labour for training and development, the funds often cannot be allocated to specific training bodies because there is inadequate information. “Because only about 44% of employers have formally registered to pay the Skills Development Levy, the labour department is often unable to distinguish which particular Sector Education Training Authority [Seta] the funds should be allocated to,” Sars commissioner Pravin Gordhan said. “In recent months we have been collecting about R105-million a month. The problem is we don’t have enough information for the labour department so that they can allocate contributions to specific Setas. This is why it’s important for companies to register,” says Gordhan. This week it emerged that the major reason for companies not implementing affirmative action is a lack of skills training and development, which affects companies’ capacity to appoint blacks and women, for example, to senior positions. The Minister of Labour, Membathisi Mdladlana, at the launch of the Employment Equity Register, lambasted businesses for not complying with labour laws to end racial and gender disparities in the workplace. Two years after the Employment Equity Act (EEA) was passed only 60% of employers have complied with the legislation to draw up equity plans to promote affirmative action in the workplace by greater inclusion of blacks and women in senior positions. The deadline for employers’ equity plans was June 1, but now a new deadline of December 1 is in place. Of the companies who responded to the Employment Equity Register 42% cited lack of training and development as the biggest hindrance to affirmative action. Mdladlana warned this week that fines would also be imposed on companies that have not submitted their equity plans to the labour department.
Mdladlana expressed disappointment with the lack of compliance by employers, adding that a large proportion do not care about employment equity. “It tells us that in the absence of legislation, employers will not rectify inequities created by our history. I doubt whether any of them could claim ignorance of the law,” he said. “As we have said many times, employment equity makes good business sense. This country cannot grow and develop when a significant portion of our human resources are underutilised,” Mdladlana said. To address the dearth of skills in the country, the Skills Development Act and the Skills Development Levies Act were passed a year ago. These acts require that each company contribute a percentage of their turnover towards the skills levy, by registering with Sars. The money then goes to the labour department to set up Setas, where training takes place. The aim of the Skills Development Act is to provide the country’s 10-million strong workforce with skills to position them favourably in the unfolding competitive and globally integrating labour market. It is also intended to provide people who have no skills with means to enter the labour market and to contribute towards decreasing the nearly 40% unemployment level in the country.
When the Skills Development Act was implemented in April this year, and required every employer with more than 150 workers (or an annual wage bill of R250E000 or more) to pay a levy, it got off to a slow start because many employers were confused about how exactly to proceed. The labour department and Sars tried to jack up the process with information hotlines as well as imposing penalties on recalcitrant employers.
In the meanwhile the training and development shortage in the country is reflected in the fact that only 20% of our economically active population is skilled or highly skilled, while 80% (12-million) is semi-skilled, unskilled or unemployed. In terms of the Skills Development Levies Act, an employer must apply to the commissioner to be registered for purposes of the levy when he/she becomes liable to pay the levy. Every employer must pay the levy not later than seven days after the end of each month in respect of which the levy is payable. While the government is battling to get recalcitrant employers to comply with skills and equity legislation, organised labour is, meanwhile, intent on challenging the government on its proposed labour amendment changes.
The crux of the matter here is how much the labour market should be deregulated. The proposed amendments would favour big and small businesses and erode hard-won rights of workers, trade unions argue. Business feels there should be as much deregulation as possible. This, in its view, encourages employment and the survival of small businesses. While the proposed amendments to the Labour Relations Act and the Basic Conditions of Employment Act have not yet been passed by Parliament, the Congress of South African Trade Unions at its recent congress threatened to go on a national strike in March should the amendments become law. Some of the controversial issues include the transfers of businesses, bargaining councils, probation, pay for Sunday work and a reduction of the 45-hour week. A hotline number has been set up for employers seeking information about the EEA, planning and reporting procedures: 086 10 10 18