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The increase in industrial action over the past two years has heavily stressed the need for a well-defined and well-understood remuneration policy in the event of a strike.
According to the Department of Labour’s Industrial Action report, workers involved in strike action during 2017 lost R251 million in wages compared to R161 million in 2016. This represents an increase of almost 56%. The number of workers involved in strike action increase by almost 39% from 2016 to last year. According to the report strike action increased by 8% over the last two years and is the highest since the department started monitoring strike action. The Labour Relations Act allows for the “No work, No pay Principle”, however it is not as simple as the mere loss of wages for the time employees are not at work. SAPA executive Lavine Haripersad says a company’s policy or practice note must be quite specific and detailed around the payment or suspension of benefits during the strike period. The Policy The impact on benefits such as medical aid cover, pension contributions and risk cover are seldom considered when the “No work, No pay Principle” is applied. In terms of the act the employer is not obliged to pay the employee during the strike period. This also applies to the payment made by the employer on behalf of the employee for certain benefits. “If these payments are suspended during the strike, it means employees are not covered when they at their most vulnerable. They could be injured, or someone might even die and their families are left exposed.” Other payroll considerations relate to the impact on leave and bonus payments when employees participate in industrial action. Haripersad says a bonus payment will have to be made pro rata to adjust for the days the employee was on strike. It is also general practice that there will be no leave accrual during the time workers are on strike. According to the Department of Labour’s 2017 Industrial Action report most strikes lasted around 11 working days, which translates into around half of the month’s possible leave accrual. The Agreement If there is an agreement between the union and the employer that the payment of benefits will continue during a strike, it is important that the policy states clearly how the money will be recouped at a later stage from employees. Statutory payments will take precedence – this includes Pay-As-You-Earn (PAYE) and contributions to the Unemployment Insurance Fund (UIF). During strike actions the Human Resource Director and Executive Management are focused on the strike and in trying to ensure that the business is not affected negatively. There is then little time to consider payroll issues. If there is a clear and well-understood policy and agreement, it is one thing less to worry about. The System Most companies will have a system which can accommodate the calculations of pro-rata payroll and alignment to the policy to manage the impact of industrial action. It is critical to keep accurate time records to know when the employee was absent from work to ensure that payroll is adjusted accordingly. Employers are legally required to keep these records during strike periods. Another issue is when the strike continues from one tax year into the next and the adjustment of payroll. In some instances, it may be necessary to go back to the previous tax year and adjust payroll to ensure that the tax records reflect correctly, notes Haripersad. ENDS MEDIA CONTACT: Idéle Prinsloo, 082 573 9219, [email protected], www.atthatpoint.co.za For more information on SAPA please visit: Website: http://www.sapayroll.co.za/ Twitter: @SAPayroll LinkedIn: The South African Payroll Associatio
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Factors such as age, lifestyle and experience make it difficult to analyse whether employees want more net pay or better benefits, but one thing is certain, there is no one size fits all solution.
What has become evident is that millennials are redefining employee benefits and that employers must find ways to adapt. Millennials are a growing sector of the workforce, and so employers need to consider how their benefit or remuneration structure should change to attract and retain talent. Younger people may prefer to look for benefits which they can personally manage, as they are technologically better skilled. The trend is to want higher net pay with fewer “built in” benefits. On the other hand, for the older generation it may be different, they might prefer more security with benefits, in the form of health care and retirement fund savings. The labour force may also look for more net pay, as they are already battling to make ends meet. Over 55% of South Africa’s population currently live below the poverty line, and in such cases taking care of immediate needs overrules things like saving for retirement. Higher paid employees will most likely favor better benefits as they already have enough money to take care of the necessities. The role of the economy in employees’ preferences Things like economic downgrading, unemployment and retrenchment threats play an important part in the decisions made by employees. South Africans are financially stressed, and when people have less money, things like retirement and healthcare will take a backseat, and left to be worried about at a later stage. The basic cost of living in South Africa is estimated to be at R5 544 a month, and with the proposed minimum wage of R3 500 per month, employees will still be struggling to get by, leaving no possible room for saving for their old age. The most important benefits Benefits, rather than salary taken in isolation, are a better predictor of employees enjoying their jobs. Employers strive to attract, retain and motivate a skilled, high performance workforce. If an employee is in the position to negotiate better benefits, the most important ones to look out for are retirement, risk and healthcare benefits. When considering healthcare benefits, flexibility in choice is key. Employees should be able to choose their plan to suit their and their family’s needs. When looking at retirement benefits, it is important to have a risk component included as part of a retirement fund scheme. The way to go would be umbrella funds with flexible options as every employee has a different need depending on where they are in their life. The cost of disability and life cover benefits can be very cost effective in a Group Scheme, rather than if taken in a personal capacity. Choice, flexibility and equity is key in the benefits model offer so that employees can make choices depending on their needs that are constantly changing. Employers must remain relevant to their employee benefit offering. The employer’s role in assisting employees to make better financial decisions Employers should provide financial education to employees to assist them in making the right choices for their future. A responsible employer will offer compulsory savings in the form of a retirement fund and basic health care benefits. Enforced payroll deductions as part of an employment package are often the only way employees are encouraged to save or to mitigate risks. It is argued that you are less likely to miss money already subtracted than money you are expected to save after paying all your monthly expenses. employers need to remember that even if it is an employees preference to have a higher net pay with less benefits, should trouble strike the employee they will look first to the employer for a “bail out”, and assuming the employer needs the employee back at work, they will be left footing the bill. In the end it is very much up to the individual’s needs when deciding between better benefits and higher net pay, and no employer should force their employees into either direction. ENDS MEDIA CONTACT: Idéle Prinsloo, 082 573 9219, [email protected], www.atthatpoint.co.za For more information on SAPA please visit: Website: http://www.sapayroll.co.za/ Twitter: @SAPayroll LinkedIn: The South African Payroll Association Everyone wants to know how they can grow their salary, how they can take their increase above the standard percentage point and take home more for their hard work. Fortunately, there are steps that anyone can follow that will help them to grow their salary and their value.
“Your first step is to know your value and believe in yourself,” says Lavine Haripersad, Payroll Manager, South African Payroll Association (SAPA). “If you walk into a meeting to negotiate your salary and you’re vague on your value, then things are unlikely to change. If you’re confident and recognise how you contribute to the business, then you are more likely to negotiate with confidence.” Have a clear understanding of your job requirements and what is expected of you. Things are always changing, in every profession, and those who keep abreast of the latest trends and technology, who are constantly updating their knowledge will be in a strong position when looking to negotiate a raise. Build a network of peers, expand your understanding of your role and develop your skills. “This will make a huge difference in how you can negotiate,” says Haripersad. “It is further supported by going the extra mile. Hard work does pay so if your standard increase is 7% and you are angling for a 9% increase, then you can’t be a 9-5 person. Ensure that you achieve performance scores beyond what is expected of you.” Show your value In fact, by consistently overachieving on your KPIs, you are placing yourself in a very strong position as an employee. However, you also need to let the business know that you are a high achiever and that you are adding value to the business. It is important to showcase your work, to let management see how you are performing and to make yourself an indispensable resource. “You almost want to ensure that your company is now working to keep you happy,” says Haripersad. “Put your hand up, accept challenges and expand your role. Be the person who is visibly making an effort to be a part of the company.” Before moving into any salary negotiation, you also need to do your research. Find out what your role is worth on the market and what the salary benchmark is. There are different levels of benchmark, so you need to do all the right things to negotiate and earn at the upper level. Be willing to grow “Know your strengths and your weaknesses too, and be receptive to criticism,” adds Haripersad. “Show how you are working to grow yourself and to make all the right changes. Look for ways to work smarter and be sure to share your knowledge. Use feedback to build a strong relationship with your manager and an open line of communication. If you talk to your manager and make his or her life easier, they will see your value to them as well.” Finally, be unique. Don’t be the run-of-the-mill employee, be the person who stands out and makes a positive and constructive difference. This doesn’t mean vibrant feathered hats; rather a focus on doing the best you can while ensuring that people know you are there and willing to do your job. By immersing yourself in the culture and future of your company, you will be in a strong position to grow your salary that important extra percent. ENDS MEDIA CONTACT: Idéle Prinsloo, 082 573 9219, [email protected], www.atthatpoint.co.za For more information on SAPA please visit: Website: http://www.sapayroll.co.za/ Twitter: @SAPayroll LinkedIn: The South African Payroll Association  Companies need to rethink payroll services and follow the international trend of investing more in mobile self-service solutions, advises Lavine Haripersad, a director at the South African Payroll Association (SAPA). “It’s time to put payroll in your employees’ pockets or purses. Mobile devices are having a huge impact on our lives,” she adds.
The mobile experience According to industry experts, mobile penetration in South Africa is around 37% to 45% of the population. This is due to the introduction of cheaper smartphones as well as a growing dependency on mobile communications for everyday life and business. South Africans use their devices for a myriad of personal activities. At work, however, employees often face the frustration of lengthy processes to complete simple tasks - like leave applications - or access their personnel information. This is in direct contrast to their typical online experience. “We need to see workers as consumers and find ways to provide the experience they’re used to. That means going mobile,” states Haripersad. What’s available? Many reputable software vendors, such as Accsys, Intuit, Oracle, Sage and SAP offer employee self-service products for small, medium and large businesses, although their features vary. Also, managed services companies providing outsourced payroll services may use a self-service app to make information accessible and reduce costly interactions. “While many apps exist,” advises Haripersad, “companies are usually restricted to the one produced by their business system’s developer.” The following are the most popular features: · View and update personal information Payroll staff spend a lot of time reviewing records. It’s more efficient to allow employees to do it themselves. Their changes can be approved by their manager before updating the payroll database, depending on the workflow structured into the system. · View payslips Notify staff when their payslips are ready through their mobile device and let them download a digital copy. This could save companies millions annually in printing and distribution costs. These are also fast becoming acceptable to retailers who require proof of income. · PAYE & IRP5 Allow employees access to their tax data to keep track of their tax obligations, answer tax queries and submit their returns easily with the information on hand. · Managing leave Reduce manual processing by letting staff submit leave requests through the self-service app. They’ll also be able to check their remaining leave, reducing your payroll administrator’s workload. · Travel & expense claims Employees can submit their travel claims together with other expenses. These can be automatically forwarded to their manager for approval before being submitted to the payroll administrator. · Time & attendance Depending on the app, employees could clock in or out with their smartphones, enter the time they worked on a task, or even be reminded of when their next shift will start. · Employee benefits Staff could, at any time, check their benefits to see their current status, such as the value of their pension plan or available funds in their medical aid scheme. · Manager benefits Using a mobile application for items like leave, payroll input or training application approvals saves a line manager a lot of time, as it can be done “on the go”, while being able to be assured that your staff are at work when they should be is also useful. Ultimately, using mobile applications which allow employees to participate in what used to be traditional payroll processing, will allow payroll staff to spend less time servicing common requests and focus more on strategic activities. In conclusion, Haripersad encourages every organisation to investigate the benefits of a mobile self-service app. “Technology is evolving fast and payroll must keep up if companies want employees to be happy and productive. This means making information and services available to them in a way they’ve come to expect.” SAPA will be hosting its annual conference this year titled Portraits of Success as follows:
To register visit http://www.sapayroll.co.za/Events/Conference.aspx ENDS MEDIA CONTACT: Idéle Prinsloo, 082 573 9219, [email protected], www.atthatpoint.co.za For more information on SAPA please visit: Website: http://www.sapayroll.co.za/ Twitter: @SAPayroll LinkedIn: The South African Payroll Association |
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