Accsys People Management

Basic Guide to Employment Contracts (Domestic Workers) - Part 3 of 5

2012-02-10T08:36:00.000+02:00

Written Particulars of Employment

At the start of employment, employers must give workers a document containing the following information:

Employer and Worker Details

• Employer’s full name
• Employer’s address

Basic Guide to Employment Contracts (Domestic Workers) - Part 2 of 5

2012-02-08T08:04:00.002+02:00

The Basic Conditions of Employment Act applies in respect of any matter not covered by this sectoral determination.
The provisions for employment contracts do not apply to domestic workers working less than 24 hours a month for an employer.

Basic Guide to Employment Contracts (Domestic Workers) - Part 1 of 5

2012-02-06T08:44:00.000+02:00

Employers must give workers certain details of their employment in writing. This contract must be kept for 3 years after termination.
Application:

Sectoral Determination 7 applies to all domestic workers (including independent contractors and those employed by agencies), except domestic workers who:
work on farms

or are covered by:

another sectoral determination
a bargaining council agreement

Employer’s Guide to UIF - Part 3 of 3

2012-02-02T16:59:00.000+02:00

Deducting contributions

Employers must deduct 1% of their workers’ pay for UIF.
Based on Legislation in Section 7, of the Unemployment Insurance Contributions Act

Paying

Employers must pay the 1% they deducted from workers, together with 1% from themselves to the UIF or SARS before the 7th of every month.
Based on Legislation in Section 6, Section 8, Section 9, of the Unemployment Insurance Contributions Act

Employer’s Guide to UIF - Part 2 of 3

2012-01-31T09:58:00.000+02:00

Registration and Declarations

Employers must register themselves and their worker(s) as soon as they employ someone.
Employers must also inform the UIF of changes (e.g. new workers appointed or changes in salary) before the 7th of every month.

Based on Legislation in Section 56, of the Unemployment Insurance Act

Employer’s Guide to UIF - Part 1 of 3

2012-01-27T13:54:00.002+02:00

The Unemployment Insurance Act and Unemployment Insurance Contributions Act apply to all employers and workers, but not to:

workers working less than 24 hours a month for an employer
learners
public servants
foreigners working on contract
workers who get a monthly State (old age) pension
workers who only earn commission

Domestic employers and their workers are included under the Act since 1 April 2003.

Worker’s Guide to UIF - Part 4 of 4

2012-01-25T08:17:00.000+02:00

Claiming Adoption Benefits
When they claim Maternity Benefits workers must complete the correct forms and hand it in at a labour centre.
Claiming Dependant’s Benefits
When they claim Maternity Benefits workers’ dependants must complete the correct forms and hand it in at a labour centre
Reference - www.labour.gov.za

Worker’s Guide to UIF - Part 3 of 4

2012-01-23T08:44:00.000+02:00

Claiming Illness Benefits
When they claim Illness Benefits workers must

complete the correct forms and hand it in at a labour centre (See How to Claim UIF Illness Benefits)
go for medical treatment if asked to

Claiming Maternity Benefits

When they claim Maternity Benefits workers must complete the correct forms and hand it in at a labour centre .

Reference - www.labour.gov.za

Worker’s Guide to UIF - Part 2 of 4

2012-01-20T09:04:00.000+02:00

Claiming Unemployment Benefits
When they claim Unemployment Benefits workers must:

complete the correct forms and hand it in at a labour centre (See How to Claim UIF Unemployment Benefits)
register as work-seekers (See How to Register as Work-seeker)
be available to start work
report to a labour centre when asked to
undergo training and counselling when asked to

Reference - www.labour.gov.za

Worker’s Guide to UIF - Part 1 of 4

2012-01-18T08:20:00.002+02:00

Workers must contribute 1% of their pay to the UIF. To claim UIF benefits, workers must complete certain forms and hand them in at their nearest labour centre.
The Unemployment Insurance Act and Unmployment Insurance Contributions Act apply to all employers and workers, but not to:

workers working less than 24 hours a month for an employer
learners
public servants
foreigners working on contract
workers who get a monthly State (old age) pension
workers who only earn commission

Domestic employers and their workers are included under the Act since 1 April 2003.

Reference - www.labour.gov.za

Basic Guide to UIF Registration - Part 3 of 3

2012-01-16T07:45:00.002+02:00

Who Must Register with SARS?

All employers who are required to register their workers with SARS for the payment of PAYE (Pay As You Earn) and/or SDL (Skills Development Levy) must also register with SARS for their UIF.

Reference - www.labour.gov.za

Basic Guide to UIF Registration - Part 2 of 3

2012-01-13T09:42:00.000+02:00

Who Must Register with UIF?
All employers must register directly with the UIF, unless they

are required to register as employers under the Income Tax Act; or
pay the skills development levy under the Skills Development Act.

Reference - www.labour.gov.za

Basic Guide to UIF Registration - Part 1 of 3

2012-01-11T16:29:00.000+02:00

Employers must register with the Unemployment Insurance Fund (UIF) or the South African Revenue Services (SARS). Application The Unemployment Insurance Act and Unemployment Insurance Contributions Act apply to all employers and workers, but not to:

workers working less than 24 hours a month for an employer
learners
public servants
foreigners working on contract
workers who get a monthly State (old age) pension
workers who only earn commission

Reference - www.labour.gov.za

Dealing with Foreign Income - Part 4 of 4

2012-01-09T11:39:00.002+02:00

If you have employees on your payroll that fall under foreign employment income, you need to make sure that you use the tax codes for foreign income service when paying them. It is also important that you capture them as nature of person “M” to indicate foreign employment income. Separate certificates must be given to the employee if their income consists of local remuneration and foreign remuneration for certain periods during a specific tax year.

Dealing with Foreign Income - Part 3 of 4

2012-01-05T08:38:00.000+02:00

Since tax systems differ from one country to the other, the risk of double taxation exists, i.e. that tax is deducted in South Africa as well as the source country. A double taxation agreement between countries might help in offering tax relief. South Africa has entered into these agreements with a number of countries to avoid double taxation of income paid to South African tax payers from foreign source or of income paid to foreign taxpayers from South African source.

Dealing with Foreign Income - Part 2 of 4

2012-01-03T10:04:00.000+02:00

Employees not residing in South Africa on the other hand are basically not liable for South African Income tax unless the source of income is based in South Africa. On this note it is important that we define our non-resident employees. As South Africa has a resident based system we need to be able to define who is non-resident. A non- resident is a person who spends less than 183 days in the country in a period of 12 months.
When trying to determine the source of income you need to look at the source of income and the location of the work done, thus only part of the remuneration that relates to work actually rendered in South Africa will be regarded as from a South African source. The rule is applicable regardless of the origins of payment for the work or the employment contract. For non-executive directors, however, the source of income is considered to be where the head office of the company is based.

Dealing with Foreign Income - Part 1 of 4

2011-12-28T11:41:00.000+02:00

As the world becomes more and more of a global village and companies are penetrating new markets, most employers have resorted to using their existing talent resource pool to expand into these new markets. This has made it imperative for employers to understand the international and local tax regulations to ensure that they are complying with the relevant country’s tax and also avoid double taxation of employees where applicable.
When looking at foreign service income the first thing to be understood is the source of income. This, as well as the country in which the employee is a resident, plays a large role on how an employee will be taxed. The general rule of the South African taxing system is that South Africa taxes employees residing in South Africa on their worldwide income. However, they are subject to certain exclusions on the tax on their worldwide income, irrespective of where their income was earned.

Tax Types of South Africa - Part 4 of 4

2011-12-22T09:29:00.000+02:00

An employer must issue an employee with an IRP5/IT3(a) where remuneration is paid or has become payable and from which Employees' Tax was deducted. The IRP5/IT3(a) discloses the total employment remuneration earned for the year of assessment and the total deductions.

Tax Types of South Africa - Part 3 of 4

2011-12-20T09:06:00.000+02:00

An employer who is to registered or required to register with SARS for PAYE, is also required to register with SARS for the payment of Unemployment Insurance Fund (UIF) contributions to SARS and SDL, Skills Development Levy. UIF and SDL are calculated differently from PAYE.
To an extent, the taxation process has been automated between your employer and SARS which makes submitting your end of year Tax Certificates (IRP5’s) a simple process. The Employer submit IRP5’s electronically using software called e@syFile, which allows SARS to pre-populate the individuals tax return submission.

Tax Types in South Africa - Part 2 of 4

2011-12-15T08:16:00.000+02:00

As an Employee of a company, you are subjected to at least one of the above tax types, namely Pay As You Earn (PAYE). PAYE is the scaling taxation method that the South Africa Revenue Services (SARS) us to calculate the percentage we get taxed on our income. Your income is also subject to Unemployment Insurance Fund (UIF), which is an insurance rather than a taxation deduction. Many employers are also liable for the Skills Development Levy (SDL), dependent on company turnover and headcount.
Employees’ Tax refers to the tax required to be deducted by an employer from remuneration given or payable to an employee. The amounts deducted or withheld must be paid by the employer to SARS on a monthly basis, and in SARS bank account by the 7th of each month following the month in which it was deducted.

Tax Types in South Africa - Part 1 of 4

2011-12-13T09:30:00.000+02:00

Countries rely on tax to fund the different departments within government. As people in the payroll industry approach the 2012/2013 financial tax year, which starts on 1st March 2012, it is useful to know more about this subject.
Each income generating citizen is subjected to tax in some form or another. We are so used to paying these amounts that we sometimes don’t recognise them as taxation! These include: Air Passenger Tax (APT), Capital Gains Tax (CGT), Diamond Export Levy, Donations Tax, Estate Duty, Excise Duties and Levies, Mineral and Petroleum Resource Royalty, Income Tax (IT), Pay As You Earn (PAYE), Provisional Tax, Retirement Funds Tax, Secondary Tax on Companies (STC), Securities Transfer Tax (STT), Skills Development Levy (SDL) (actually paid for by your employer company rather than by the individual), Stamp Duty, Transfer Duty, Turnover Tax, Uncertificated Securities Tax, Value Added Tax (VAT).

Compensation for Occupational Injuries and Diseases Act - Part 3 of 3

2011-12-07T08:42:00.000+02:00

Reference - http://www.labour.gov.za
This excludes

workers who are totally or partially disabled for less than 3 days;
domestic workers;
anyone receiving military training;
members of :

the South African National Defence Force, or
the South African Police Service

any worker guilty of wilful misconduct, unless they are seriously disabled or killed;
anyone employed outside the RSA for 12 or more continuous months; and
workers working mainly outside the RSA and only temporarily employed in the RSA.

Compensation for Occupational Injuries and Diseases Act - Part 2 of 3

2011-12-05T08:15:00.000+02:00

Reference - http://www.labour.gov.za
Application
The Compensation for Occupational Injuries and Diseases Act applies to:
all employers; and casual and full-time workers who, as a result of a workplace accident or work-related disease:
• are injured, disabled, or killed; or
• become ill

Compensation for Occupational Injuries and Diseases Act - Part 1 of 3

2011-12-02T14:28:00.000+02:00

Reference - http://www.labour.gov.za/

To provide for compensation for disablement caused by occupational injuries or diseases sustained or contracted by employees in the course of their employment, or for death resulting from such injuries or diseases; and to provide for matters connected therewith.

Tax - What is this all about? Part 4 of 4

2011-11-30T07:42:00.000+02:00

What income is taxed?
There are rules governing what is considered taxable income, defined through laws passed by the state. Generally speaking, the higher the amount earned, the higher the tax. Travel Allowances are taxed at 80%, 20% or 100% dependent on the proportion of business travel that an employee does as opposed to private travel. It is important to note that the distance between home and work is considered private travel.

Tax - What is this all about? Part 3 of 4

2011-11-28T08:42:00.000+02:00

So who qualifies to pay tax?

Things are changing in South Africa, and everyone earning income needs to register as a tax payer. This does not necessarily mean that everyone pays tax.
For the 2011/2012 tax year, the annual income required to be earned in order to pay tax is R59750 if you are under the age of 65, R93150 if you are over 65 but below 75 and R104261 if you are over the age of 75. Although you will not pay any tax if you earn under this specified amount, you still have to submit a return under certain conditions.

Tax - What is this all about? Part 2 of 4

2011-11-25T08:31:00.000+02:00

Everyone pays taxes in one form or another, in South Africa most commonly as income and sales taxes. You are taxed depending on the amount you earn, and the amount you spend. The more you earn or spend, the more you are taxed.
The main reasons taxes are charged is to maintain the well-being of the country. A few of the most important examples of what taxes are used for include maintenance of roads; maintenance of public facilities such as schools, libraries and hospitals; and housing for the poor.

Tax - What is this all about? Part 1 of 4

2011-11-24T08:21:00.002+02:00

A wise saying that has been around for a long time is that “The only two things we can be absolutely certain of in life, are death and taxes”.
This saying is still something that exists and will probably exist until the end of mankind. So what is tax and why do we pay taxes?

Employee Self Service - Part 4 of 4

2011-11-18T08:17:00.002+02:00

Additional benefits include reduction in paper usage, enabling employees to analyse future leave (removing the admin requirement of having to tell individuals how much leave they will have available, for example, in December), and allowing them to view payslips and tax certificates on line.

Employee Self Service - Part 3 of 4

2011-11-16T08:18:00.000+02:00

When combined with resource pool management, a manager can also decide how many of his team can be away at any one time, and the system will automatically reject extra leave requests, without the manager becoming involved.
Recently, enhancements in ESS shifted the focus from managing only leave and employee details. Career planning, learning, skills profiles, objective settings, appraisals and additional analytics are included ESS applications. This enables the HR Department to adopt a more “hands off” approach, empowering employees to take more responsibility for their jobs and development, while allowing HR to focus on strategy rather than data management.

Employee Self Service - Part 2 of 4

2011-11-14T08:18:00.000+02:00

One of the benefit of having ESS is that leave management is made easy. On average, a salaried employee applies for leave 12 times every year, which means that in a traditional paper environment, 12 pieces of paper per employee have to be transferred through the channels for various signatures before ending up with HR where the details have to be captured into a system.
Using ESS, this process is managed through on-line approvals, with reminders every step of the way for each approver. Once the leave application has been processed through the correct channels, the details of the leave are automatically saved on the system. In good systems, even a manager being away from his desk is automatically catered for!

Employee Self Service - Part 1 of 4

2011-11-11T08:24:00.000+02:00

Getting employees to own their personal details

Employee self-service (ESS) is a web-based application that allows employees to access to their personal records and certain of their payroll details.
ESS usually easily integrates with and enhances a company’s Payroll and / or HR System. The most common features of ESS allows employees to apply for leave using the company’s intranet. With extended ESS, it is also possible for employees to change their own address, contact details and next of kin. Some applications enable employees to change their bank account details and provide details of payslips, both current and historical. ESS can operate as a feature on an employer’s Intranet or via a web ASP service.

Basic Guide to Employment Equity Reports - Part 5 of 5

2011-11-09T08:21:00.000+02:00

Based on Legislation in Section 22, of the Employment Equity Act

Employment Equity Managers
Employers must:

name one or more senior managers to supervise and implement the employment equity plan;
give the managers the power and resources to do their duties; and
make sure the managers do their duties.

Basic Guide to Employment Equity Reports - Part 4 of 5

2011-11-07T08:43:00.002+02:00

Based on Legislation in Section 22, of the Employment Equity Act
Contents of the report
The report must have all the necessary information and be signed by the Chief Executive Officer.
Based on Legislation in Section 21, of the Employment Equity Act

Employers Who Cannot Report
Employers who cannot report must let the Department know in writing and give reasons.
Based on Legislation in Section 21, of the Employment Equity Act

Publishing the Report
All public companies must publish summaries of their reports in their annual financial reports.

The Ministers of government organisations must table their reports in Parliament.
Based on Legislation in Section 22, of the Employment Equity Act

Basic Guide to Employment Equity Reports - Part 3 of 5

2011-11-04T10:48:00.000+02:00

Based on Legislation in Section 22, of the Employment Equity Act

When Must Employers Report?
Employers with less than 150 workers must send their reports –

within 12 months after they become employers; and thereafter
every year ending with an even number.

Employers with more than 150 workers must send their reports –

within 6 months after they become employers; and thereafter
every year on the first working day in October.

Basic Guide to Employment Equity Reports - Part 2 of 5

2011-11-02T10:49:00.000+02:00

Based on Legislation in Section 22, of the Employment Equity Act

The provisions for affirmative action apply to –

employers with 50 or more workers, or whose annual income is more than the amount specified in Schedule 4 of the Act;
municipalities;
organs of State;
employers ordered to comply by a bargaining council agreement;
any employers who volunteer to comply.

See

Employment Equity Act

Applies to all employers and workers and protects workers and job seekers from unfair discrimination, and also provides a framework for implementing affirmative action

Basic Guide to Employment Equity Reports - Part 1 of 5

2011-10-31T09:11:00.000+02:00

Based on Legislation in Section 22, of the Employment Equity Act

Employment equity reports are sent by Employers to the Department of Labour, annually. Employers who cannot report for any reason must let the Department know in writing of this. Public employers must publish summaries of their employment equity reports in their annual financial reports.

Application
The Employment Equity Act applies to all employers, workers and job applicants, other than the –

National Defence Force
National Intelligence Agency and
South African Secret Service

Voluntary Disclosure Program (or VDP) - Part 2 of 2

2011-10-28T08:07:00.002+02:00

A voluntary disclosure is valid when:

It is done voluntary by the applicant
It involves a default
If all material respects are full and complete
If a potential penalty or an additional tax in respect of the default may occur
It will not result in a refund from the Commissioner
It is made in the prescribed form and manner
It is made within the period as set by the Commissioner
If the default occurred prior to 17 Feb 2010

Voluntary Disclosure Program (or VDP) - Part 1 of 2

2011-10-25T12:42:00.000+02:00

The South African Revenue Service is currently marketing a Voluntary Disclosure Program (or VDP) via radio, television and in newspapers. They are letting the public know that if their tax affairs are not in order and they have a ‘ghost from past tax assessments’ they have until end October 2011 to declare these and possibly have interest and penalties waived.

Any person may apply for the Voluntary Disclosure Program (VDP) provided that there are no current or pending audits or investigations into that person’s affairs.

If any person is under a current or pending audit and wants to partake in the VDP, the Commissioner may approve the application if the default would not be otherwise detected during the audit or investigation.

Organograms - The Essential Guide - Part 4 of 4

2011-10-07T10:01:00.000+02:00

If organograms are maintained manually, they become out of date rapidly due to the changes especially in large organisations. For this reason it is useful for one’s employee management software to have the capability of automating the generation of the charts.
Organograms usually do not include customers or clients.

Organograms - The Essential Guide - Part 3 of 4

2011-10-05T09:10:00.002+02:00

Organograms are also helpful in that employees know who to report to if their direct line manager is not available. Vacant job positions can also be displayed (usually in a different outline / colour) so the management knows by looking at the organogram which positions need to be filled.

Organograms - The Essential Guide - Part 2 of 4

2011-10-03T09:03:00.002+02:00

When designing an organogram, the most popular shapes used are rectangles to represent the various positions. However, squares or circles may be used, and colour coding makes the diagrams easier to read.
A single company may have a number of organograms reflecting organisational reporting structures. For example, one could be made showing executive management, another cost centre / departmental structure. Organograms are also often used to show the process to be followed when applying for leave, purchasing, etc.

Organograms - The Essential Guide - Part 1 of 4

2011-09-30T09:27:00.000+02:00

An organogram is a chart or diagram that’s displays the structure of an organisation, usually used to identify managers and the employees who report to them.
There are three different types of charts:

Hierarchical – each manager has a team reporting directly to him / her, and the teams generally work in silos;
Matrix – used where reporting lines are more complex, and employees may report into different managers for different aspects of their job;
Horizontal or known as Flat – where there is no formal management structure.

Fingerprint Biometrics - Part 3 of 3

2011-09-28T08:26:00.000+02:00

A False Reject Rate (FFR) is a statistic which reflects the number of times a device fails to identify a person (falsely rejecting the reading), and thereby assumes that you are an imposter. A good fingerprint device would have a FRR rating of less than 0.1% which translates to one in every 1 000 readings failing to identify the employee.
It is useful to know both of these numbers if you are interested in installing biometric fingerprint readers.

Fingerprint Biometrics - Part 2 of 3

2011-09-26T11:49:00.000+02:00

A False Accept Rate (FAR) tells us how many times the biometric device confuses you with someone else. This would typically be considered a serious problem, as it would potentially give access to an unauthorised person.
A FAR of 0.01% means that 1 in every 10 000 readings will be identified incorrectly. A good fingerprint scanning / reading device has a FAR of less than 0.01%

Fingerprint Biometrics - Part 1 of 3

2011-09-23T13:53:00.000+02:00

In the past, fingerprint biometrics were evaluated by the number of minutiae points (fingerprint ridge endings, and bifurcation (forking) points that it recorded. Generally, the more points scanned in the fingerprint and recorded by a device, the more accurate the reader.
Today, the trend is to rather look at more tangible metrics to which we can all relate, such as False Accept and Reject Rates.

Providing for a tax-free bonus - Part 3 of 3

2011-09-21T11:48:00.002+02:00

To spread the tax burden over the year, one simply divides the value calculated by the number of months over which the tax will be deducted.
A useful tip, when doing this, is to ensure that the full tax liability is recalculated at the time of paying out the bonus, so that any possibly under-deduction (for example, if the employee received an increase during the year, and the tax on bonus was not redefined) is recovered.

Providing for a tax-free bonus - Part 2 of 3

2011-09-19T13:09:00.000+02:00

Effectively, this means deducting the tax from the employees in advance during the year, so that by the time the bonus is paid to the employees, the tax has already been paid. Preferably the tax should be deducted between March and December, so that the full amount is paid by the time the bonus is paid out.
Tax on annual bonuses is calculated by adding the value of the bonus to the employees anticipated annual earnings, calculating the tax on the total and then subtracting the value of tax on the annualised “normal” earnings only. The difference between the tax on the total and the tax on the annualised earnings defines the tax on the annual bonus.

Providing for a tax-free bonus - Part 1 of 3

2011-09-16T09:31:00.000+02:00

Wouldn’t it be nice to receive a bonus “tax free” at the end of a year?
As long as the tax is calculated correctly, and paid over to the South African Revenue Service according to statute, companies may choose to offer this option to employees.

The Skills Development Levy - Part 4 of 4

2011-09-14T11:03:00.000+02:00

How is the 1% of the “Leviable” amount calculated? You take total remuneration, less PAYE exclusions, less SDL Exclusions, less allowable deductions in respect of the following amounts paid by employees-
•    Current and arrear contributions to approved pension and retirement annuity funds;
•    Contributions to a medical scheme; and
•    Premiums paid to an insurance policy which covers the employee against the loss of income and in respect of which amounts paid constitutes income.
You can claim up to 50% of the SDL (Skills Development Levy) paid in a year back from your SETA by simply submitting a skills development plan to the SETA by the 30th of June each year.

The Skills Development Levy - Part 3 of 4

2011-09-12T09:53:00.001+02:00

The Commissioner for the South African Revenue Service is responsible for administrating the SDL Act as it relates to the collection and the payment of the levy by employers to the Commissioner.
Sections 6(1) & (2) of the SDL Act prescribe that the levy must be paid over to SARS not later than 7 days after the end of the month in respect of which the levy is payable under cover of a completed EMP 201 declaration. Remember that if the 7th of the month is a Sunday or Public Holiday, the funds must be in SARS account by the Friday before.

The Skills Development Levy - Part 2 of 4

2011-09-09T08:07:00.000+02:00

It should be noted that even if your wage bill is lower than the R500 000, you can still register for SDL, and claim against your contributions.
How do you register for SDL? Section 5 of the SDL Act prescribes that an EMP 101 (Application for Registration) form is completed, and given to the SARS office in your area. This form indicates the jurisdiction of the SETA where the employer must be classified, as well as the applicable SIC (Standard Industrial Classification) code.

The Skills Development Levy - Part 1 of 4

2011-09-07T13:57:00.001+02:00

Does your gross wage bill exceed R500 000 per year? Your company should be contributing 1% of payroll to the Skills Development Levies.
Up to half of your contribution can be claimed from your SETA as reimbursement for training expenses of your staff! This is done in the form of a Mandatory Grant, provided that your company is compliant with the requirements as detailed by your SETA.

Time and Attendance Policies - Part 3 of 3

2011-09-05T12:35:00.002+02:00

Are these calculations done daily, weekly or monthly?
If hourly paid, do they get paid for overtime hours even if “normal” working hours are reduced?

Time and Attendance Policies - Part 2 of 3

2011-09-02T08:13:00.002+02:00

Do employees get paid according to the time at which they clock in or out?
Is production performance determined by the number of employees and hours spent on a line?

Time and Attendance Policies - Part 1 of 3

2011-08-31T13:44:00.001+02:00

A company must have processes in place, and understand what these are, before putting in a software system. Generally systems are automated through applying “rules” and if these are not understood, a system will not be set up properly, and will not provide the relief expected of it by the purchaser.

When implementing a time and attendance system, consider the purpose behind the purchase. For instance:

Was it to manage arrivals and departure of staff, in terms of security requirements, and being sure of who is on the premises should there be a fire?

Mentorship makes real business sense - Part 3 of 3

2011-08-19T14:18:00.000+02:00

This is also considered a more cost-effective form of training and skills development because it fast tracks individuals through a one-to-one scenario, rather than a one-to-many.
A positive by product is the learning curve for the mentor can be equally beneficial.

Mentorship makes real business sense - Part 2 of 3

2011-08-17T10:47:00.000+02:00

Mentorship works in the majority of cases because it is based on a hands-on, practical approach
A significant advantage of a mentorship programme is that people are trained correctly from the outset and are therefore of immediate value to the company or employer

Mentorship makes real business sense - Part 1 of 3

2011-08-15T15:05:00.000+02:00

Mentorship is increasing in popularity and now very much a part of the modern corporate HR strategy
Mentorship is a tried and tested method of skills development and application in industry
The core principle of mentorship is that it is based on the establishment and nurturing of a business relationship between a person who wants to develop their skills, abilities and knowledge, and someone who has the experience and skills to show best practices.

See a bonus for what it really is - Part 3 of 3

2011-08-12T10:01:00.000+02:00

Dialogue and effective communication between employer and employee is the best approach to take in order to fully clarify misunderstanding and ensure that all parties are satisfied
Open, frank and honest communication will help employees understand how their performance is being evaluated and also gather important insight and direction to improve where necessary

See a bonus for what it really is - Part 2 of 3

2011-08-10T11:58:00.000+02:00

Times have changed. In the past a guaranteed bonus was built into a package, but now it is primarily based on what has been negotiated as part of a contract
The situation governing bonus allocation becomes complex if certain precedents have been set by management

See a bonus for what it really is - Part 1 of 3

2011-08-08T09:51:00.002+02:00

Treating the bonus or 13th cheque as discretionary, based on measurable results, unless stipulated as part of a contract
The process of bonus approval and distribution ranges from company to company, but is generally used to recognise individual or team contribution

Company Cars - Part 3 of 3

2011-08-05T10:36:00.000+02:00

As an example, in the case that the Employer covers all costs for the vehicle:

An employer purchases a vehicle for sole use by an employee. Cost = R300 000 (including VAT)
Employee maintains a logbook
40000 km travelled of which 10 000 km are of business
Employer pays all costs.

In this case:
Fringe Benefit = R300 000 x 3.5 % x 12 = R126 000

The taxable value based on 80% of the above is R100 800

Business use = 10 000/40 000 x 126 000 = 31 500. This means that the fringe benefit taxable value is the difference, i.e. R126 000 – R31 500 = R94 500.

An employee with a Company Car must always keep a Log Book. This is imperative when filling in his or her Tax Returns.

Company Cars - Part 2 of 3

2011-08-03T10:07:00.000+02:00

The tax is calculated based on 80% x 3.5% i.e. 2.8% pm or 80% x 3.25% i.e. 2.6% pm.

No immediate reductions for full fuel/maintenance cost
If more than one vehicle is used primarily for business then the Monthly value = 3.5% on value of Motor Vehicle.

Company Cars - Part 1 of 3

2011-08-01T09:39:00.002+02:00

As from, 1st March 2011 the taxable value of a Company Car is calculated on:

The determined value (i.e. purchase value) of the vehicle including VAT
Monthly taxable value based on 3.5 % of determined Value
Where the motor vehicle is subject to a maintenance plan at the time the employer acquired it, the taxable value should be calculated at 3.25% of the determined value.

Now is the time for progressive, proactive recruitment - Part 2 of 2

2011-07-29T08:09:00.000+02:00

It is critical that recruiters remain vigilant in terms of market developments/ industry requirements in order to dispense the best possible advice to candidates
Recruitment agencies are obliged to thoroughly test candidates, check references and ensure the best possible fit between candidate and employer
Support for candidates in the form of training and provision of reliable information adds significant, measurable value.

Now is the time for progressive, proactive recruitment - Part 1 of 2

2011-07-27T13:24:00.000+02:00

Job seekers are under pressure to secure employment as a result of increasing competition for work, rising costs, pressure on resources and skills availability
Recruitment agencies play a critical role and have to be proactive in their support of candidates and their understanding of the needs of clients, companies
Turnaround time within agencies is important – it affects all processes and the experiences of both candidates and prospective employers

A stitch in time

2011-07-25T10:10:00.002+02:00

The Workplace Skills Reports came and for many companies June couldn’t have been any colder on account of the pressure experienced. All of a sudden there was very little time, and yet so much to process, in terms of SETA details.

Doing what we are supposed to do all year long will surely relieve us of the pressure that builds up when legal deadlines loom.

The end of September marks the deadline for Employment Equity Reporting for many companies with annual reporting obligations. Many other companies report within the required two-year cycles.

We can ensure that we maintain our employee record details keep track of all relevant transactions ahead of these deadlines. It is important to maintain:

Training interventions
Disciplinary incidents
Job levels and Job Functions
Income differentials, i.e. payment structure information

Electronic Time & Attendance - Part 2 of 2

2011-07-21T07:30:00.001+02:00

The time and attendance shift schedules should be studied, and the rules around payment discussed in detail to ensure that the same rules satisfy, and are understood by, both parties. Details of tea and lunch breaks, whether they are paid, at which point the employee starts getting paid, and how overtime should be determined and who authorises it should be defined. Preferably, this would be detailed in a Company Policy Document for future reference.

Electronic Time & Attendance - Part 1 of 2

2011-07-19T12:51:00.001+02:00

Before considering implementation of an electronic Time and Attendance system, the Payroll Administrators and Factory Supervisors should meet to ensure that there is a common understanding of how the hours are calculated according to which their employees are paid.

Notice of Termination of Employment - Part 3 of 3

2011-07-15T08:05:00.000+02:00

Notice of Termination of Employment given by the employer must not be given during, and may not run at the same time as, any period of annual, maternity, or family responsibility leave to which the employee is entitled, except sick leave.

Notice of Termination of Employment - Part 2 of 3

2011-07-13T13:37:00.002+02:00

Notice of Termination of a contract of employment must be given in writing, except when it is given by an illiterate employee.
Should the employer exempt the employee from the obligation of working through a notice period, or waive any part of the notice period, the employee must be paid in lieu of notice.

Notice of Termination of Employment - Part 1 of 3

2011-07-11T08:14:00.002+02:00

According to the Basic Conditions of Employment Act:
Termination of Employment by one of the people who have signed the contract may be given with notice of not less than:

One week, if the employee has been employed for six months or less;
Two weeks, if the employee has been employed for more than six months but not more than one year;
Four weeks, if the employee has been employed for one year or more. Farm and domestic workers are entitled to four weeks’ notice after six months’ employment.

Information on Payslips

2011-07-07T08:21:00.000+02:00

A record of employee information must be kept by the employer for a period of five years from the date of the last entry in the record. This information is usually stored in the form of the contract of employment, and copies of payslips.

Information on Payslips

An employee's payslip should contain the following:
The employer’s name and address
The employee’s name and occupation
The period for which the payment is made
The employee’s remuneration in money
The amount and purpose of any deduction made from the remuneration
The actual amount paid to the employee
If relevant to the calculation of that employee’s remuneration
The employee’s rate of remuneration and overtime rate
The number of ordinary and overtime hours worked by the employee during the period for which the payment is made
The number of hours worked by the employee on a Sunday or public holiday during that period

Employee Records

2011-07-05T08:17:00.002+02:00

Every employer must keep a record containing at least the following information:

The employee’s name and occupation
The time worked by each employee
The remuneration paid to each employee
The date of birth of any employee under 18 years of age
Any other prescribed information

Regulation of Working Time - Part 3 of 3

2011-06-29T08:02:00.000+02:00

An employee may agree in writing to work up to 12 hours in a day without receiving overtime pay.
An employee who is bound by such an agreement may not work more than:

45 ordinary hours in a week over the agreed period
average of 5 hours’ overtime in a week over the agreed period

Regulation of Working Time - Part 2 of 3

2011-06-27T08:11:00.000+02:00

Overtime must be paid, at 1.5 times the employee’s normal wage within the work week.
If no overtime is paid, an employee may be granted time off in lieu of payment. This will need to be agreed upon by both parties.

Regulation of Working Time - Part 1 of 3

2011-06-24T07:50:00.001+02:00

According to the Basic Conditions of Employment Act

No employer may permit an employee to work more than:

45 hours in any week
9 hours in any day if an employee works for 5 days or less in a week
8 hours in any day if an employee works on more than 5 days in a week

An employer may not permit an employee

to work overtime except by an agreement
to work more than ten hours’ overtime a week

Working with Fingerprint Biometrics

2011-06-22T07:43:00.000+02:00

The most important factor for ensuring success when using fingerprint biometrics, is quality of the initial enrolment of the employee’s fingerprint on the system being used. The more effort put into scanning quality fingerprint templates, the more successful the system will be.

The larger the area scanned, the more likely a successful fingerprint, easily recognised by the reader. Should a person have small hands and fingers, try to avoid using anything but the thumbs and index fingers, as the typical small size of the other fingers limits the scan area, and therefore allows for more variations from one scan to next.

Avoid enrolling people in extreme temperature conditions as your enrolment is the most important factor for success. Hands should be warm (as in room temperature, not heated), and reasonably moist. Should hands be extremely creased or dry, use hand lotion before scanning. Be sure to wipe off excess lotion before performing the scan.

Time and Attendance Best Practice

2011-06-20T08:40:00.000+02:00

Deadlines are often missed by leaving work until the last minute. T&A Best Practice requires that timesheets are checked and signed off daily.

This means checking, amending and authorising of employee’s hours should be done daily, leaving only one days’ work for the last day of the pay period whether this is weekly or monthly.

Follow these steps to make sure that all the T&A administration is completed by the end of the pay period:

Print the previous day’s timesheets daily;
Send these timesheets through to the relevant supervisors / Head of Department (HOD);
The supervisor / HOD should then check the reports and authorise or amend the hours as required;
The timesheets are then signed by the supervisors / HOD’s and sent back to the T&A administrator(s);
The administrator should then check these reports and make all the necessary changes on the T&A system and sign it off.

This process will ensure that all the hours of every employee are checked, ensuring that they will be correctly paid by the payroll department. It is much easier to remember the facts of what happened the day before, that to try to remember anomalies at the end of a week or month.

This is step 1 to a happy workforce!

Public Holiday Pay - Part 2 of 2

2011-06-17T08:02:00.002+02:00

Example: An employee works 8hrs a day and thus receives 8hrs “free” on a public holiday without having to come to work. If the employee does work for 4hrs on the public holiday he should receive the following:

8hrs Public Holiday Pay
4hrs Normal pay (Actual Time Worked)

If the employee worked the whole day resulting in 8hrs normal pay they would receive the following:

8hrs Public Holiday Pay
8hrs Normal pay (Actual Time Worked)

As you can see from the last example the employee earned a total of 16hrs pay for only working 8hrs.

Public Holiday Pay - Part 1 of 2

2011-06-15T13:50:00.000+02:00

How should pay be calculated when an employee works on a Public Holiday?

Many employers assume that employees should be paid double time (Overtime 2.0) for any time worked on the specific Public Holiday, which is not necessarily the case.

The rule is usually that employees automatically get their normal hourly rate for the 8, 8.5 or 9 hours that they usually work, even if not required to work on a public holiday.

If they do work on the public holiday they should get their normal time again.

Many employers pay a working employee their normal rate plus their Overtime 2.0 rate for the time worked on the Public Holiday. This means that the employee is actually getting paid three times their rate instead of double their hourly rate.

The correct allocation of payment should thus be when an employee is not present they receive their normal hourly rate, and if they do work on the public holiday they should be paid their normal hourly rate for the number of hours they are present.

Managing User Rights Groups on e@syFile - Part 2 of 2

2011-06-10T09:39:00.000+02:00

We believe that the ability to regularly register employees for tax reference numbers with SARS will be made available shortly

Managing User Rights Groups on e@syFile - Part 1 of 2

2011-06-08T09:05:00.000+02:00

Employers have begun to synchronise to SARS systems using e@syFile in order to receive their employees’ tax reference numbers. This should be a simple process however there are steps to follow in order to ensure that the synchronization runs smoothly.
One of the requirements for this process to be successful is the managing of the rights group in your eFiling profile.

Log into Efiling and go to Organisations, find the rights group option and click on Manage Groups.

Open system default, rename your group and ensure all tax types are ticked. Update these changes.
Once you have done this click on Manage Users. Drag the user from the left Unallocated Users of the screen to the right adding them to the group you have just renamed.
Then click back to group list. You can now go into your manage taxpayers profile and assign all taxpayers to the relevant users.

Once the above steps have been completed you can go back into e@syFile. It is recommended that if you have anything in your Inbox, it should be all marked as “read” and then the Inbox cleared.
Then you can re-sync. Should an error appear saying (Some taxpayers are not active) this is a group rights issue and can be corrected by following the above steps.
Should the system give you an error saying tax payer not found the likely cause is that the information you have submitted and the information on the SARS server do not correspond. Check ID numbers and spelling of names.

Documents Recommended to New Employees

2011-06-06T07:36:00.000+02:00

Signed and dated Contract of Employment, including:

Occupation
Date of commencement of employment
Nature of employment (e.g. full-time, indefinite, fixed-term)
Hours of work
Remuneration

Medical Aid application form – signed and dated
Provident fund / retirement scheme application form – signed and dated
Provident / Pension Fund beneficiary nomination form – signed and dated
Union Reference Number
Retirement Annuity

Documents needed by New Employees

2011-06-03T08:05:00.000+02:00

The take-on of New Employees onto the Company Payroll System requires the following documents from the new employee/s:

Identity document (or passport and work permit – where applicable)
Signed and dated Employee Details/Application Form that includes:

Employee contact details including residential and postal address
Personal tax reference number
Employment history

Bank account details
Department of Labour EEA1 (disclosing the employee’s equity status i.e. race, gender, disability status, nationality) – signed and dated.

Maintaining Leave Records - Part 8 of 8

2011-06-01T08:00:00.001+02:00

Family Responsibility Leave

Family responsibility leave only applies to employees who has been employed for longer than 4 months and who works at least 4 days a week.
Full time employees are entitled to three days paid family responsibility leave per year, on request, when the employee’s child is born or sick, or in the event of the death of the employee’s spouse or life partner, or the employee’s parent, adoptive parent, grandparent, child, adopted child, grandchild or sibling.
An employer may require reasonable proof.
The employer must pay the employee for family responsibility leave, normal rate and on the usual pay day.
The unused entitlement to leave lapses at annual leave cycle.

Maintaining Leave Records - Part 7 of 8

2011-05-30T10:50:00.001+02:00

Maternity Leave

Protection of employees before and after birth
A pregnant employee or employee nursing her child is not allowed to perform work that is hazardous to her or her child.
The employer must offer a pregnant employee, both during pregancy and 6 months after birth, alternative employment on terms and conditions that are no less favourable than her ordinary terms and conditions of employment, if the employee is required to perform night work or her work poses danger to her health or safety or that of her child and it must per practicable for the employer to do so.

Maintaining Leave Records - Part 6 of 8

2011-05-27T08:32:00.000+02:00

Maternity Leave

An employer must be notified in writing as soon as possible or at least four weeks before the date on which the employee intends to commence maternity leave and return to work after maternity leave.
Any payments of maternity benefits will be determined by the Minister subject to the provisions of the Unemployment Insurance Act, 1966 (Act No. 30 of 1966)

Maintaining Leave Records - Part 5 of 8

2011-05-25T07:33:00.001+02:00

Maternity Leave

A pregnant employee is entitled to four consecutive months’ maternity leave and two pregnancies per 5 year cycle.
A pregnant employee can commence her maternity leave from four weeks before the expected date of birth unless otherwise agreed or a date which a medical practitioner certifies if necessary for the employees or unborn child's health.
No employee should commence work for at least 6 weeks after the birth unless a medical practitioner provides a certificate to indicate that she is fit to do so.
If an employee miscarriage during the 3rd trimester or bears a stillborn child, they are entitled to maternity leave for 6 weeks.

Maintaining Leave Records - Part 4 of 8

2011-05-23T07:08:00.000+02:00

Sick Leave

An employee is entitled to six weeks’ paid sick leave in a period of 36 months.
During the first six months an employee is entitled to one day’s paid sick leave for every 26 days worked.
An employer may require a medical certificate before paying an employee who is absent for more than two consecutive days or who is frequently absent.

Maintaining Leave Records - Part 3 of 8

2011-05-20T07:44:00.000+02:00

Leave must be granted not later than six months after the end of the annual leave cycle.
The employer may not require or permit an employee to take annual leave during any other period of leave to which the employee is entitled or any period of notice of termination of employment or not pay an employee instead of granting leave except on termination of employment.
The employer may reduce an employee's entitlement to annual leave by the number of days of occasional leave on full remuneration granted to the employee at the employee's request in that leave cycle.
Additional days of paid leave should be granted if a public holiday falls on a day during an employee's annual leave and no employer can require any employee to work during any period of annual leave.
The employer must pay the employee leave pay at least equivalent to the remuneration for working for a period equal to the period of annual leave, before the beginning of the period of annual leave or by agreement, on the employee's usual pay date.
All leave application records should be kept for history purposes or future discrepancies.

Maintaining Leave Records - Part 2 of 8

2011-05-17T07:19:00.000+02:00

Your company’s rules and regulations / employment contract should be in line with the BCEA (Basic Conditions of Employment Act) and your payroll/leave system setup should be according to the above.
The following are a summary of BCEA rules for annual leave. These rules do not apply to an employee who works less than 24 hours a month.

The annual leave cycle is 12 months, unless an agreement (contract of employment) provides otherwise, this does not apply to leave granted to an employee in excess of the employee’s entitlement.
Employees are entitled to 21 consecutive days’ annual leave or by agreement, one day full remuneration for every 17 days worked or one hour for every 17 hours worked.

Leave accumulation: Depending on the company leave rules the leave accumulation can be calculated per month (15 days per annum / 12 months = 1.25 days accumulated per month) or per annum. If the leave is accumulated per annum and the employee takes leave before his anniversary of his engagement date, the company allows the leave taken to be in credit. After the anniversary date the employee will receive their full annual leave accumulation (i.e. 15 days – leave taken = leave balance).

Maintaining Leave Records - Part 1 of 8

2011-05-16T07:58:00.001+02:00

It is vital for a company to keep annual leave records up to date as this will affect the leave provision in the financial statements.
If this provision is understated it can be seen as a disclosure deficiency.
Due to leave provisions being costly the company should encourage all staff member to take their full leave entitlement per year, so the minimum leave is carried over to the following year. Some companies have strict rules whereby an employee forfeits leave days not taken within a specific period after the anniversary engagement date.

Outsourcing your Payroll - Part 3 of 3

2011-05-12T07:40:00.000+02:00

Besides the fact that outsourcing can be more cost-effective in the long run, it allows companies to concentrate on their core business, while a specialist company assumes responsibility for the payroll administration.
Additionally, payroll professionals should be highly experienced and always on a par with the latest technology and legislation.

Outsourcing your Payroll - Part 2 of 3

2011-05-10T13:05:00.000+02:00

A good outsource bureau will be able to pick up the payroll, run it for the specified time and then “dump” it back onto the clients system as soon as the administrator returns to work.
Similarly, should the client want to terminate the outsourcing contract, the bureau should be able to quickly and easily drop the payroll onto the company system and train the administrator on its usage so that they can be up and running as quickly as possible.
Confidentiality of the payroll is also an important consideration. You may want to run your wages and junior salaries internally, but outsource that of the executive members.

Outsourcing your Payroll - Part 1 of 3

2011-05-06T07:49:00.000+02:00

When outsourcing your Payroll, make sure you take heed of the following tips:

Firstly, identify any problems being experienced with running the payroll in-house and weigh these up against the advantages of outsourcing.
The size of the company, for example, is an important factor to consider – if you are hiring a full-time administrator to run a payroll for 25 employees, it definitely makes sense to outsource.
It is best to choose an outsource bureau that is flexible enough to meet the changing needs of its clients with minimal disruption to their business operations during the transition. For example if the payroll administrator goes on maternity leave, rather than employ a temporary staff member who is not familiar with the company systems and who can make serious mistakes, it may be wiser to outsource.

Manual Tax Calculations - Part 2 of 2

2011-05-03T09:07:00.000+02:00

According to SARS, Paragraph 11B(3)(b) of the 4th Schedule prescribes a special formula to be used to calculate employees’ tax on annual payments.

The following are examples of annual payments or payments made without reference to a period:

Annual bonus;
Incentive bonus;
Leave pay on resignation;
Encashment of leave;
Merit awards;
Backdated payments in respect of salary / wages (accrued in previous tax years);
An amount paid to a mineworker for picking up a diamond;
An amount paid to an employee for a proposal to simplify procedures

IRP 5 / IT 3(a) detail — The total of all annual payments received during the tax year must be reflected under code 3605 on the certificate.

Manual tax calculations - Part 1 of 2

2011-04-19T10:17:00.000+02:00

Do manual tax calculations to check the tax on the payslips.
A bonus or an incentive amount paid to an employee to retain his / her services for a specific period is taxable. It should be noted that where this amount is repayable by the employee on termination of his / her service prior to the end of the contract period, the employees' tax paid on this amount may under no circumstances be refunded to the employee.

Payroll Data Protection and Confidentiality - Part 3 of 3

2011-04-15T07:27:00.001+02:00

Remember that your payroll information is confidential, and should be kept safe and secure at all times.
Access to your payroll information / system should be granted only to properly authorised individuals.
Privacy concerns exist wherever personally identifiable information is collected and stored – in digital form or otherwise. Improper or non-existent disclosure control can be the root cause for privacy issues.