 What is the Unemployment Insurance Fund and how does it work?
The Unemployment Insurance Fund is a fund to which employees and employers contribute on a monthly basis. The employee contributes 1% of their gross salary and the employer also contributes 1% of each employees’ salary. The fund is there to provide temporary financial relief to employees who find themselves without a job. This applies to all employees except for the following:
“Employees can claim up to 60% of their previous earnings but this is limited to a maximum amount of R14 872.Another great benefit is that expectant mothers who work for companies that don’t offer paid maternity leave can claim UIF benefits for four months,” says Jetro Malapane from the South African Payroll Association. After changes have been made to the Act, benefits for 10 days unpaid parental leave (for new fathers or a parent of an adopted child) can also be claimed. Beneficiaries of a deceased spouse or parent are also allowed to claim benefits, subject to certain conditions. What are the most important things employees need to know about UIF? Employees need to ensure that the correct amount is being deducted from their salaries, so it is a good idea to calculate the 1% of your gross salary and making sure it agrees to the amount on your pay slip. Employees earning higher salaries (above the threshold of R14 872 per month or R178 464 annually) need to check that the maximum contribution of R148.72 is being deducted from their salary. The Unemployment Insurance Benefit pays the first 238 days at a rate between 38 – 60% and then from 239 to 365 days at a flat rate of 20%. It is important to know that if you resigned from you position you can not claim UIF benefits. “Whenever you leave a position, it is of high importance that you obtain your UI 19 form from your employer, whether you will be able to claim or not, as the Department of Labour need to keep track of your contributions and claims, “according to Jetro. The bill allows employees to apply for maternity leave benefits eight weeks before delivery and up to 12 months after birth, on a flat rate for maternity benefits (66% of a woman's salary). It also allows women who have lost their child in the last trimester qualify for maternity benefits and provide that a contributor (Male or Female) is entitled to illness benefits if the days of illness are seven days. Another change to take note of is that the period you can claim benefits for has been extended from 6 months to 12 months. As well as providing for extension of benefits to those previously excluded i.e. Learner ships, Foreign Nationals and Civil Servants. What are the responsibilities of employers regarding UIF Employers need to familiarise themselves with the changes made to the Unemployment Insurance Act, namely the amendments made by Labour Laws Amendment Act 10 of 2018. It is of great importance that employers calculate the contributions from themselves and the employees correctly. They should make sure that they are 100% compliant with the rules of UIF, in order to make sure that when the time comes employees will be able to claim their benefits when and if the time comes. Declarations and payments must be made on the 7th of every month, or the last Friday before the 7th if it falls on a weekend. ENDS MEDIA CONTACT: Rosa-Mari Le Roux, 060 995 6277, rosa-mari@thatpoint.co.za, 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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 Co-authored by: Christelle Helling, Exco of the South African Payroll Association
Nelson Mandela once said: “Education is the most powerful weapon which you can use to change the world.” For South African companies who have the available resources, there is a great initiative from the government which will allow companies to help employees and their families gain an education. Education should never be limited to just the rich and powerful. We need to empower a whole generation by giving them the education they need to better their lives. How company-sponsored bursaries work For a bursary or scholarship to qualify as a bona-fide bursary or scholarship (which means it will be tax exempt for the employee), it needs to meet the following requirements:
If for example an employee has three school-going children, they can apply for three bursaries of R20 000 each, providing that this additional R60 000 does not push their annual salary over the R600 000 limit to comply with the rules. How companies should select employees for bursaries and scholarships Employers should have a robust policy in place before implementing company-sponsored bursaries. The policy must specify the requirements that should be met and should also be based on merit and need. Education as a human right means that governments have an obligation to protect, respect and fulfil the right to education. This initiative is a gesture from the government that it is willing to honour its statement that education is a basic human right. Implementation of company-sponsored bursaries and scholarships The changes resulting from the bursaries and scholarships will have to be internally driven. Consultants can be used during the first implementation phase but after that payroll and HR departments should take the responsibility to ensure that employees’ packages are correctly calculated and to have discussions with all qualifying employees where all the details are explained, and they are shown detailed examples to ensure they fully comprehend the benefits. Leaving a legacy Companies should also see this initiative as a way of investing in their own future. If a company helps employees by providing them and their families with an education, they are cultivating loyal employees. They are also creating a legacy where the employees and their children will now have a proper education and can work for and help improve the company. As Helling says: “This is a great initiative because change lies in our children and their education.” ENDS MEDIA CONTACT: Rosa-Mari Le Roux, 060 995 6277, rosa-mari@thatpoint.co.za, 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  The South African Labour Law allows employers leeway to pay their employees until the seventh day of the following month.
However, the majority of companies in South Africa have set a precedent by paying their employees by the 25th of the month, says Arlene Leggat, President of the South African Payroll Association (SAPA). The law The law stipulates that employers must pay their employees within seven days of the end of a pay period. If we take March, the pay period is 1 March to 31 March, therefore the employer legally has until 7 April to pay his employees. The precedent In South Africa there is a precedent to pay employees on the 25th of each month and in the light of that, people have organised to have their debit orders go off from the 26th of each month. “In effect it does not give payroll any leeway. If people are not paid on the 25th they can get into trouble because they may not have sufficient funds to honour their debit orders.” Although employers are not legally obliged to pay their employees on the 25th of each month they have created an expectation that they will. “Companies are now obliged to meet the expectation that has been created. You really have to pay your employees at the 25th of each month, because people have so much dependent on it.” Financial distress South African companies have been suffering financial difficulties because of the lack of economic growth. Cash flow problems have led to some being unable to pay their staff on time. “It does happen more often than we want to believe, and it does happen to a lot of smaller companies. I do not understand why, but for some reason people think they can delay payment to small businesses, and they can’t.” Any debtor who delays payment to a small company is putting their employees at risk. Late payment It is extremely rare to have an entire company’s payroll being paid late. “You may find that one or two people are being paid late because their paperwork did not arrive on time,” says Leggat. Payroll administrators may not have been alerted to a new employee on time, and the paperwork is not done timeously. This happens quite often, she Leggat. Habitual late payer Employees who find their employer habitually pays a day or two late, find themselves in a difficult position. The company is not breaking the law, because they have the seven-day leeway. However, employees should use their employee forums, employee representatives or unions to take the matter up with the human resource department or even management. The employee has very little recourse if they are not paid “on time”, as long as they are paid by the 7th of the next month. “My recommendation to all employees is to ensure that their debit orders go off at the first of the next month. That gives everybody a little bit of time when payment is a day or two late.” ENDS MEDIA CONTACT: Rosa-Mari Le Roux , 060 995 6277, rosa-mari@thatpoint.co.za, 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  The National Minimum Wage Act came into effect on 1 January 2019. While the Department of Labour has issued exemptions to the Act, it reported that it had only received 26 applications for the exemption.
By the end of January, one employer had been arrested by the South African Police Services for fraud for claiming that it could pay workers R16 an hour. “The Department of Labour said that it planned to open a case against an employer that misrepresented his company to obtain an exemption from paying the National Minimal Wage. This is a clear and harsh message to companies who want to underpay workers by misrepresenting the profitability and assets of their business,” says Jetro Malapane, Executive Committee member of the South African Payroll Association What are the rules surrounding the Minimum Wage and exemptions? The National Minimum Wage Act No 9 of 2018, which was signed by President Cyril Ramaphosa, established a new minimum wage of R20.00 per hour for every ordinary hour worked, excluding farm workers, domestic workers and workers employed on an expanded public works program. If an employer cannot afford to pay the National Minimum Wage, it can apply for an exemption under Section 15 of the National Wage Act. The requirements to apply for an exemption haven’t been finalised, but it is anticipated that employers will have to submit audited financial statements, written submissions of employees’ reaction to the exemption application, and particulars such as the employer’s SARS number and UIF number, among others details. “There was only a short time between the signing of the Act and its commencement date, which sent many employers into a tailspin. The Department of Labour is going to make sure that a company that cannot pay minimum wage is truly not in a financial position to pay the minimum wage. It will also make sure the employer’s particulars and the way they treat employees are above board before they consider granting an exemption,” says Malapane. What payroll professionals need to know about the Minimum Wage While the exemption procedure hasn’t been established, Section 16 of the Act will be dedicated to the Minister of Labour’s regulations on the information an employer must provide for an exemption, the procedure that needs to be followed, the manner of consultation with employees and the period within which an application for the exemption should be made. According to SEESA, the Department of Labour is in the process of creating an online National Minimum Wage Exemption System that employers can use to apply for an exemption, but the launch of the system is yet to be established. If an employer receives an exemption from minimum wage, it may not exceed a period of one year. “Payroll professionals should ensure that their clients and employers are aware of the Minimum Wage Act and that employees are being paid accordingly. The Department of Labour’s spokesperson has stated that the Department is intent on naming and shaming employers who are engaging in fraudulent activities by paying below the minimum wage. Claiming that your business has exemption to the minimum wage when it doesn’t is fraud,” concludes Malapane. ENDS MEDIA CONTACT: Rosa-Mari Le Roux, 060 995 6277, rosa-mari@thatpoint.co.za, 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  While many South African citizens would agree that payroll measures are put in place to prevent or detect fraud, this is not the most important reason to ensure that a company has proper controls and frameworks, South African Payroll Association (SAPA) board chairperson Arlene Leggat points out.
Speakers at SAPA’s annual conference, which took place across three South African cities, further highlighted why companies needed to ensure that they have the correct measures in place. Leggat relays some of these points. The first step of implementing these controls is to ensure that your company’s payroll complies with legislative requirements. “We all have the same legislation to comply with,” she points out, adding that the focus would then move to what makes your organisation different - internal policies. “Are the policies compliant and then are they being implemented as intended?” Challenges in introducing a framework When it comes to the implementation of a payroll framework within an organisation, Leggat points out that while the actual application shouldn’t be challenging, there are other challenges companies face that aren’t always obvious. “There are way too many payroll departments out there who presume that the system is legislatively compliant and so it is not checked. If you can run a payroll, you should make time to ensure that it is correct,” she urges. Time pressures are often an obstacle that payroll manager and administrators face. Leggat explains that it is hard to impose a deadline schedule, which allows time to correctly do all the checks and controls when the payroll department is not supported by a company’s human resources department, or its managers. “There is always someone who hasn’t done what they need to do in time, and to make sure the employee is not penalised, payroll needs to try and get things processed. This makes their window for checks and controls much shorter, which then allows for errors.” To err is human, but at what cost? Leggat further highlights that as human intervention plays a part in any payroll environment, it will always bring about the possibility of mistakes. “In light of the value of some payrolls, an undetected mistake could be very expensive, and that is the main reason for setting up proper payroll controls. It is to ensure that mistakes that are made within the payroll environment are picked up and corrected before they become significant payroll errors.” Not implementing payroll controls and frameworks also poses significant risks to a business, Leggat says. “Those risks generally do not involve fraud. I have seen over payments ranging from R10 to R3-million to employees; legislative errors, which cost a pretty penny in penalties from the Department of Labour and the South African Revenue Services; losses due to lack of controls in bursary and loan structures." "The financial loss to an organisation can be huge and that is what the controls need to mitigate. As far as non-compliance goes, one runs the risk of setting a precedent and facing the same penalties, again.” “As far as controls are concerned, I think that consistency is an imperative." "Do not rely on an external auditor to pick up any issue; run your own internal audits on a regular basis, get a payroll consultant in to work through your payroll to pick up any issues and design an internal payroll audit program that is thorough and covers all bases,” Leggat notes. ENDS MEDIA CONTACT: Rosa-Mari Le Roux , 082 573 9219, rosa-mari@thatpoint.co.za, 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  Payroll fulfills many roles within an organisation. Besides being responsible for employees’ compensation and ensuring that the business complies with various legislations, payroll can also drive engagement with employees.
Christelle Helling, Executive Committee Member of the South African Payroll Association (SAPA), says that payroll managers have many hats to wear within a business. “Payroll is the custodian of very personal and important information within a business. We create a safe space for people to come and discuss matters relating to their salaries. As payroll managers, we need to be empathetic and make sure we are proactively driving communication about everything from retirement policies and medical aid benefits to smarter saving, budgeting and investing,” says Helling. Helping employees be smarter with their money Many companies offer different employee benefit packages. When policies change, or new options become available to staff, it is payroll’s role to engage with workers so that they make the best decisions for themselves, their families, and their financial goals. “Sometimes a simple email communication is enough to update employees, but other times payroll needs to work more closely with HR to ensure certain topics are addressed within a more appropriate platform for the target audience. Being able to continually communicate what the company offers employees in terms of benefits is also very beneficial to the company because it serves as a live advertisement of how the business takes care of its employees,” says Helling. Better corporate responsibility and ethics is encouraging According to a 2018 study by LRN, provider of governance, ethics and compliance management applications and services, whether a company acts ethically is a significant factor in the average American’s willingness to work for an employer. Their study showed that one in three employed Americans had actually left a job because they disagreed with a company’s business ethics. According to the 2016 Cone Communications Millennial Employee Engagement Study, three-quarters (76%) of Millennials would take a pay cut to work for a socially responsible company. “In addition to the financial obligations that a company has towards its employees, payroll has to ensure that a company’s activities adhere to the country’s tax obligations and comply with employment legislation. Employees don’t want to work for or engage with unethical businesses. Payroll acts as a watchdog and if payroll can meet payroll deadlines consistently and accurately, then employees have more trust in the company’s ability to uphold its commitments to the law, society and the communities in which it operates. A good payroll department encourages employees to work harder for a brand and it upholds the company’s reputation in the industry,” says Helling. Aligning teams for better engagement At a departmental level, payroll acts as Switzerland between the finance and the HR team. “Payroll often works very closely with the accounting department as well as the people team. When payroll is closely aligned with these departments, engagement with employees goes up. Ensuring all the departments use the same language and are working towards the same goals has become a core function of the payroll department,” concludes Helling. ENDS MEDIA CONTACT: Rosa-Mari Le Roux, 060 995 6277, rosa-mari@thatpoint.co.za, 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  Since 2014, a Cape Town father, Henri Terblanche has been campaigning for more parental leave for fathers. Fathers were only entitled to 3 days family responsibility leave as stated in the Basic Conditions of Employment Act.
Mr. Terblanche’s campaign was based on research done in Norway and Sweden and emphasised the benefits it would have for our society. The African Christian Democratic Party (ACDP) then tabled a private member’s bill, relying principally on Mr. Terblanche’s campaign, to help push the process. What the Bill entails The Bill provides for 10 days paid parental leave for fathers, as well as 10 weeks consecutive leave for mothers. The Bill was seen as a major breakthrough for same-sex couples, especially men, who were never entitled to the time needed to introduce a child into their family and bond with it. The Bill also provides for parents of adopted children under the age of 2 years. An employee is entitled to at least 10 consecutive weeks of adoption leave, which starts on the day the adoption order is granted. For a surrogate motherhood agreement, a commissioning parent is also allowed at least 10 consecutive weeks of leave, which begins on the date of childbirth.Only one parent may take adoption or commissioning parental leave (both 10 weeks). The other must take parental leave (10 days). In November 2017 the Labour Law Amendment Bill was passed by Parliament. A big victory for parents On 23 November 2018 President Cyril Ramaphosa signed the Labour Relations and Labour Amendment Acts into law. This is a major step forward for parents in South Africa. “For fathers to be able to claim their parental leave from UIF is a much bigger victory than it may seem” says Christelle Helling from the South African Payroll Association (SAPA). What this means for companies “Companies will have to revise their policies and procedures to accommodate the changes to the Basic Conditions of Employment Act” notes Helling. These changes will have to be implemented fast because the Act comes into effect from January 2019. How South Africa compares to the rest of the world Around the world fathers’ rights to paid paternity leave varies greatly. When compared to the rest of Africa, our new law of 10 days paid parental leave is very progressive, as the norm is between three and five days. We also compare favourably to countries such as Italy (one day, paid), New Zealand (two weeks, unpaid) and the United States of America (12 weeks, unpaid). We do however still fall behind countries like India (three weeks, paid), Iran (three weeks for the first and second child, paid), Spain (15 days, paid), Finland (54 days, paid) and Iceland (3 months, paid). However slow the progress might have been, at least we are catching up. ENDS MEDIA CONTACT: Rosa-Mari Le Roux, 060 995 6277, rosa-mari@thatpoint.co.za, 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  Authored by: Sumeshan Nair, Executive Committee Member of the South African Payroll Association (SAPA)
Many employees look forward to their annual bonus, only to be met with disappointment when a large portion of the bonus is deducted for tax. Sumeshan Nair, Executive Committee Member of the South African Payroll Association (SAPA), says that “employees can pay extra tax on a monthly basis towards the tax that would be deducted from their annual bonus so that no tax is deducted when a person receives their annual bonus.” “An amount is included in an employee’s monthly tax calculation to compensate for the tax on the bonus when the annual bonus is paid. This way, the employee effectively pays their ‘bonus tax’ month on month to get a full bonus payout” says Nair. Employees can request this option from employers One of the main reasons for companies failing to offer this option to staff is because they are unsure of how it works or how the monthly tax deductions should be calculated therefore not offering it to their employees. This has led to employees being unaware of the option for provision for tax on bonus and thereby being hit with a large tax deduction on their annual bonus. “If more employees request this option, then payroll professionals can request that their employers change the status quo so that this becomes a standard offering for employees,” says Nair. Payroll vendors offer automated functionalities and training Nair says “Different companies have different approaches on how they make provision for the tax on bonus for their employees and that the process will depend on the payroll vendor or software that is used. Leading solutions providers offer very straightforward options to automate this calculation.” “Payroll professionals can ask their vendors whether their software incorporates these options and they can also request training from their vendor on how to use this functionality. It is important to embrace change through the digital solutions that are at a payroll professional’s disposal,” says Nair. Nair warns payroll professionals against doing their own calculations when processing monthly tax deductions for the tax on bonuses themselves as the software that they use often has this functionality. “It is always best to opt for an automated calculation when determining an employee’s provision for tax on bonus. The employee’s tax on bonus will be based on an individual’s marginal tax rate, so if the employee falls within the 35% tax bracket within a tax year, he will pay approximately 35% of his bonus to taxes. Instead of this happening, the tax can be automatically calculated and deducted each month so that employees absorb the smaller financial knocks throughout the tax year and get their full bonus payout,” says Nair. The provision for tax on bonus is calculated over the tax year and not the calendar year. Nair encourages employees to request this at the beginning of every tax year. “Employees should request it for the next tax year should they want to spread out their tax deductions throughout the year to get their full payout of their bonus,” concludes Nair. ENDS MEDIA CONTACT: Rosa-Mari Le Roux, 060 995 6277, rosa-mari@thatpoint.co.za, 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  In an attempt to resolve ongoing statement of account errors in some of the country’s biggest companies, the South African Payroll Association (SAPA) is set to meet with the South African Revenue Services (SARS) acting head Mark Kingon later this month.
SAPA board chairperson Arlene Leggat explains that when large organisations submit their EMP201 to SARS, it indicates how much it has deducted from their employees’ pay for tax purposes. The deductions would subsequently be paid over to SARS, clearing an organisation’s account with the revenue collector. “The problem is that SARS compiles all this information into journals. There are no particular reasons for these journals and no-one in SARS can explain what they are for. The figures that are journalised are invariably not related to any payment or EMP201 on the account,” Leggat notes. She further explains that these journals often result in an accounting error, and subsequently an underpayment reflecting on a particular company’s statement of account. “Although this might not seem like a significant issue, it can lead to further damage to the country’s economy,” Leggat warns. If an organisation reflects an under-payment at SARS, they are deemed non-tax compliant, and therefore cannot receive tax clearance from the agency. “If a company does not carry tax clearance, it cannot do business – it really is that simple. This issue is affecting the ability of organisations to function, grow and create those jobs we so desperately need. Surely, this is something we really need to fix. It is stemming from utter incompetence within SARS.” Although Leggat cannot give an absolute answer as to how many companies are being affected by erroneous statement of accounts, she states that it is a large majority of the country’s biggest companies, including construction companies and a hospitality groups. Action Plan Through its meeting with Kingon, SAPA says it would aim to set a committed team or point of contact in place at SARS, who will deal with any statement of account issues that may arise. “We will be highlighting the issues received from our members and requesting resolution from SARS,” says Leggat. Further, SAPA is seeking commitment from SARS to resolve these long-standing issues. “We would like to have a process from SARS in how to approach all of these issues – something that is clearly defined and has an expected time-frame and outcome. This will give SAPA and the employers a means to query and escalate unresolved issues within a certain time-frame, instead of continually being fobbed off.” Taking it to the next level Leggat points out that if no resolve is made through the meeting with Kingon, SAPA will have no choice but to take the matter further. “If a company has tried to resolve its issues with SARS, but it has proof, case numbers, and correspondence; then it is time to go to the Tax Ombud who will further assist in obtaining final resolution,” she says. ENDS MEDIA CONTACT: Rosa-Mari Le Roux, 060 995 6277, rosa-mari@thatpoint.co.za, 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 If you have signed an employment contract that specifies something different to the Basic Conditions of Employment Act (BCEA), this will supersede what’s outlined in the Act provided that there is agreement between the parties and the conditions specified are not less favourable than the BCEA, warns Cathie Webb, member (and prior executive) of the South African Payroll Association (SAPA).
The BCEA is committed to regulating fair labour practice for both employers and employees in South Africa. It clearly explains what needs to be done when notifying an employer that you are leaving and what the employer needs to do when it comes to final salary payments. The Act also covers a multitude of additional issues and challenges that could face the business or the employee in the workplace, providing clear guidelines that are upheld by law. However, when it comes to calculating remuneration during termination periods, there are some complexities that need to be addressed, which may not be covered by the BCEA. The BCEA states that the notice period must be four weeks (for someone who has worked for more than 6 months with the company). Many companies, though, require a calendar months’ notice. If the signed contract is for a calendar month, then the employee and payroll have to adhere to this timeline. Generally, the terms and conditions outlined in a signed contract will trump those outlined by the BCEA and employees need to be aware of this from the outset. “That said, an employment contract may not offer working conditions worse than the basic conditions specified in the BCEA,” says Webb. “Employees do need to check their contracts before signing them to avoid unpleasantness. It is exciting to have a new job lined up, but the time to negotiate your employment terms is before you start, not after.” Payroll needs to know “It is critical that payroll be aware of what’s outlined in an employees’ contract to avoid any confusion when the person resigns,” adds Webb. “For example, many companies do not allow you to take annual leave in your resignation period, but situations may arise that make taking leave during this period a necessity. This possibility needs to be planned for, so that both the employer and the employee know how this would be dealt with, and what is to be paid out in the final payslip. Clarity from both sides is essential.” Payroll needs to know and understand the rules of the 3rd parties who are paid from employee deductions / contributions. Medical aids run from calendar month to calendar month, and contributions are usually made in arrears. This means that the final deduction from payroll pays for their final contribution to the medical aid. Pension and provident funds may work differently, with their month running from the 16th of one month to the 15th of the next. This may mean that, in a company where a 30 day notice period applies and an employee resigns before the 16th of the month, they do not contribute to the fund in their final month, while if they resign after the 16th, there will still be a deduction. Other pay elements like final commissions, travel claims and re-imbursements, shift allowances, etc., should also follow what has been stipulated in the contract of employment. Employees are also not aware that quite often they are not paid on the 25th of their last month. Companies have been burned by employees leaving the moment they receive their final salary, and not working the last 5 or so days of their final month. So companies may have a policy to pay employees who are leaving on first day of the following month. This must be outlined in the contract and will affect the employee if not clearly communicated when they resign. This may result in an employee having to make special banking arrangements to deal with debit orders which may be set to be processed towards the end of the month. Payroll can make this process a lot smoother. “The BCEA also outlines how much notice is required according to how long a person has worked at a company,” says Webb. “If you have worked for less than six months it is one week’s notice, if for more than six months it is two weeks’ notice, and if it is more than a year it becomes four weeks’ notice.” Webb emphasises that payroll plays a vital part in ensuring that both employee and employer finish their last month amicably. “Things need to be maintained by both payroll and HR so that when a person leaves all elements are calculated correctly and comply with the conditions outlined by the BCEA,” concludes Webb. ENDS MEDIA CONTACT: Idéle Prinsloo, 082 573 9219, idele@thatpoint.co.za, 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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