Agricultural Sector Provident Fund (ASPF) – make provision

Nov 1, 2022 | Articles, Latest in the industry

Agricultural Sector Provident Fund (ASPF) – make provision

Recognition should rightly be given to employers in the agricultural sector regarding the way they continuously act in the interest of employees. Financial planning is an important aspect that every worker should pay attention to and therefore it is also important that an organisation such as the LWO Employers Organisation will participate in initiatives to provide affordable retirement, disability, death, funeral and withdrawal benefits for farm workers. The Agricultural Sector Provident Fund (ASPF) offers several affordable plans with unique benefits to employees.

The ASPF is supported and managed by a board of trustees with representation by the LWO, Agri SA, TLU SA and professional independent Trustees. The Board of Trustees looks after affordable contributions, as well as competitive benefits for participating farm workers.

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ASPF – New service provider

During 2022 the Trustees of the ASPF conducted an intensive market investigation to consider the appointment of an alternative administration company to administer the ASPF and appointed Verso Financial Services (Pty) Ltd as the new fund administrator with effect from 01 October 2022.

Members and employers will be able to register on the fund’s website with Verso. Members will also have the ability to download an application on their smartphones. In doing so they will have access to personal information such as nominated beneficiaries, contribution history, salary history, history of processed transactions, accumulated fund value as well as member benefit statements.

It is important to acknowledge that farmers have a social responsibility towards their workers when they become too old to work, or due to unforeseen circumstances become medically disabled either because of a medical condition or an accident, or die before they reach the normal retirement age.

Contact details

Employers who do not yet participate in the ASPF for their employees can contact Ben de Jager at ben@verso.co.za | 071 495 3333.

Employers who already participate in the ASPF can contact Desiree Morreira at desireem@verso.co.za | 021 943 5300 for administrative support.

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Employers may say ‘no’

Oct 31, 2022 | Articles, Business owners tips and advice

Employers may say ‘no’

Employers may say ‘no’ to various requests from employees. Although the employer must act fairly and uniformly, the employer has the right to refuse requests based on operational requirements. The employer must also think carefully about making allowances and concessions to prevent setting a precedent in the future. Three common requests from employees that the employer does not have to grant include:

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Option to say ‘no’ – Leave and time off

In terms of the Basic Conditions of Employment Act, the employee is entitled to one day’s paid leave for every 17 days worked. Although the employee is entitled to take leave, the employee must still apply for leave and the employer may reject it based on operational requirements, such as for example that it is the busiest time of production.

When the employee request time off to deal with personal matters, such as visiting the clinic for a routine examination or to obtain medication, the employer can refuse. These visits can be scheduled in the employee’s private time, alternatively the employee must take annual leave. Note that paid sick leave only applies when an employee is unable to work due to a medical condition.

Option to say ‘no’ – Loans

Loans should preferably not be granted to employees. The employer is not a financial institution and when loans are granted to employees on a regular basis, this can create an expectation among employees, as well as set a precedent for future loans.

Option to say ‘no’ – Ex-gratia payments

Ex-gratia payments refer to when the employer grants a payment to the employee on an ad hoc basis, such as for example with termination of employment, a marriage confirmation, funeral, etc. This payment is solely at the discretion of the employer and the employer must clearly communicate that there is no expectation created of similar future payments.

It is important that the employer acts consistently with respect to discipline, procedures, working conditions, employment conditions and compensation to avoid unfair discrimination.

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20 tips for employers

Oct 31, 2022 | Articles, Business owners tips and advice

20 tips for employers

Tips for complying with labour law – non-compliance holds a serious business risk for employers, often underestimated and left unaddressed… Labour law sets strict requirements that employers must comply with, irrespective of the number of employees. Employers should make the mind shift to not only comply with labour law, but to use it to protect their businesses and their rights as employers.

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20 tips employers should pay attention to:

Ensure you have an employment contract in place with every employee – the employment contract is the most important document in the workplace and forms the basis of the relationship between the employer and employee. This is one of the key tips to protect your rights as the employer. Ensure however, that you don’t settle for a generic employment contract, but rather opt for a purpose-built one according to your business.

Use fixed term contracts carefully and in line with legislation – employers must clearly understand that to disguise what is actually permanent employment in the form of a fixed term contract is illegal.

Make provisions for deductions in the employment contract – no deductions, except for statutory deductions, can be made without the employee’s consent.

Address time periods in the employment contract with regards to short time, rest periods, compressed working weeks, etc.

Implement a formal retirement age.

Ensure every employee has a job description with achievable goals. Employees need to know what is expected of them and what standard applies to performance. Continuous evaluation and training is essential to assess work performance. Give recognition to employees who achieve goals and perform well.

Pay at least the national minimum wage.

Keep a copy of the Sectoral Determination or Main Collective Agreement (if applicable to your business industry) in the workplace and make it available to employees.

Display the posters of legislative summaries in the workplace – Basic Conditions of Employment Act, Employment Equity Act and Occupational Health and Safety Act.

Use the disciplinary code to enforce the use of personal protective equipment (PPE).

Verify if you are considered to be a “designated employer” in terms of the Employment Equity Act and must comply with certain requirements.

Ensure your disciplinary code is relevant and up to date – every workplace must have a relevant disciplinary code. The disciplinary code is important to ensure that there are clear rules in the workplace for employees to follow. When these rules are broken, the employer can apply discipline in accordance with the applicable sanctions as listed in the code.

Every business is unique – implement policies that are fair to address specific issues in your environment.

Have regular consultations with employees – effective communication creates an environment receptive to growth. This creates a platform for employees to discuss their thoughts, ideas and any specific needs.

Issue warnings in line with the disciplinary code.

Be consistent when applying discipline to avoid discrimination in the workplace.

Always follow the correct procedure, especially when the employment relationship is terminated.

Implement an attendance register that also records hours worked – the payslip must also reflect this information.

Ensure that you, as the employer, are registered with the Unemployment Insurance Fund (UIF) and the Compensation Commissioner.

Implement a grievance procedure – it is imperative that the employer establish internal procedures to give employees the opportunity to bring any unhappiness or unsatisfactory working conditions to the attention of the employer.

Tips for the best tip? Get access to a support base for practical advice and assistance to continuously comply with labour law – take note that through membership with the LWO, you get 24/7 access to our legal department for advice and assistance. Labour law applies to every employer; mistakes are often costly and can be limited or avoided by being proactive.

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Incapacity versus misconduct

Oct 31, 2022 | Articles

Incapacity versus misconduct

Employers are often confronted with situations where it is difficult to differentiate between misconduct and incapacity. It is however crucial that the employer conduct a proper investigation before taking any disciplinary steps to ascertain if the employee’s conduct leans towards misconduct, or incapacity, as this will determine what process the employer should follow to address the issue.

Although both the disciplinary hearing and incapacity consultation are deemed fair procedures (if executed correctly), the employer should take care to apply the right procedure according to the employee’s conduct. In many cases employers follow the wrong procedure and then dismiss the employee. This poses a real risk to the employer if the employee refers the matter to the Commission for Conciliation, Mediation and Arbitration (CCMA) and the commissioner issues an award for remuneration and/or reinstatement.

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Incapacity

Incapacity refers to when an employee is incompetent and inherently unable to meet fixed performance standards whether due to ill health or poor work performance. The employer is required to provide an employee with training and guidance, as well as the opportunity to improve, where the employee lacks the required skill or knowledge to perform a certain task. Where the employee cannot perform according to the employer’s required standard due to ill health, the employer should consider the nature of the employee’s job, period of absence, seriousness of the employee’s illness or injury, possibility of accommodating the employee’s disability, and possibility of securing alternative employment within the business.

Misconduct

Misconduct refers to an employee’s failure to adhere to the employer’s rules and policies. In basic terms, misconduct is a behaviour issue of the employee. Such behaviour is normally deliberate or negligent, and employees can be held accountable for their actions. Misconduct can take various forms, including theft, fraud, dishonesty, insubordination, absence from work without permission, etc.

Every workplace must have a relevant disciplinary code. The disciplinary code is essential in ensuring that there are clear rules in the workplace, with appropriate sanctions, that employees can follow. When these rules are broken, the employer can apply progressive discipline. In cases of serious misconduct employers can directly proceed with a disciplinary hearing.

During the disciplinary hearing, the employer must provide the employee with an opportunity to be heard and to respond to allegations made. The employer should prove the following:

Was there a rule in the workplace and was the employee (reasonably) aware of this rule?
Did the employee break the rule?
Did the employer apply progressive discipline (warnings)?
Is the rule consistently applied?

Grounds for dismissal

The Labour Relations Act (LRA) distinguishes between ‘no fault dismissals’ (due to operational requirements or incapacity) and ‘dismissals due to misconduct’. The three grounds for justifiable dismissal are listed as: misconduct, incapacity, and operational requirements.

It is important that employers deal with issues in the workplace as quickly and effectively as possible, while taking care to act objectively and consistently.

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Employment relationship – what can go wrong?

Sep 14, 2022 | Articles, Business owners tips and advice

Employment relationship – what can go wrong?

At the start of the employment relationship, the parties don’t know each other, but already a fiduciary duty is in place that requires the employee to act in good faith and in the best interest of the employer. It is important that the employer implement a written employment contract with each employee on the day employment commences. A written employment contract creates clarity by confirming the terms and conditions of employment agreed upon and protects the employer in terms of the employment relationship going forward. Take care to include a job description listing the employee’s duties and employer’s expectations.

The employment relationship is a relationship of trust based on mutual benefits and respect. As a business owner, the employer should always anticipate what can go wrong with regards to the employment relationship, in order to be best positioned going forward and mitigating risk. Poor work performance, conflict, misconduct, and a breach of trust can place this relationship in jeopardy and employers should take proactive steps to regulate the employment relationship and protect their rights.

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The following issues can cause a breakdown of trust in the employment relationship:

Conflict

The workplace is a very diverse environment in terms of culture, religion, beliefs, values, political views, frames of reference, work ethic, opinions, etc. Everyone won’t always get along with each other and when conflict arises, the employer should step in and assist to resolve the conflict before it escalates or starts to affect more employees.

Misconduct

Misconduct can be described as an employee’s failure to adhere to the rules and policies of the employer. In basic terms, misconduct is a behaviour issue of the employee. Such behaviour is normally deliberate or negligent, and employees can be held accountable for their actions. Misconduct can take various forms, including theft, fraud, dishonesty, insubordination, absence from work without permission, etc.

Every workplace must have a relevant disciplinary code. The disciplinary code is essential in ensuring that there are clear rules in the workplace, with appropriate sanctions, that employees can follow. When these rules are violated, the employer can apply progressive discipline. In cases of serious misconduct employers can directly proceed with a disciplinary hearing. It is vital to always follow the correct procedure, as in failing to do so can lead to dire consequences with a huge financial impact.

Poor work performance

Poor work performance refers to the incapacity of an employee, in that an employee fails to reach and maintain the employer’s work performance standards in terms of quality and quantity. All employment contracts imply that the employee undertakes to perform according to the reasonable, lawful and attainable work performance standards set by the employer. Should the employee fail in this duty, despite assistance to reach the required standard, the employee is said to be incapable, and the employer has the right to dismiss him/her subject to following the correct procedure. Poor work performance involves a consultation process where the employee is informed of shortcomings and provided with training and guidance to achieve the desired outcome. The employee is monitored for a reasonable period of time and offered further training and guidance as needed. If improvement is not sufficient, a formal disciplinary process can follow which can lead to dismissal.

It is important to keep a good and healthy working relationship in place. Boundaries should be set from the beginning of the employment relationship in order to avoid any uncertainties going forward. Keep the communication lines open for all parties to address any issues which may arise. Employers should take care to follow the correct procedures when taking disciplinary action or holding consultations.

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Layoffs and the severance package

Aug 30, 2022 | Articles

Layoffs and the severance package

In the current economic climate, many employers are under tremendous financial pressure and must consider restructuring or layoffs (retrenchment) to remain sustainable. However, many aspects must be taken into account to limit the employer’s risk in relation to the process, as well as the payment of severance packages.

Layoffs: Consultation process

Legislation dictates that when the employer is considering layoffs, a consultation process with the employees is required:

Written notice must be given to all employees 48 hours before the consultation. Each employee must sign a copy of the memorandum as proof of receipt.

A first consultation takes place between the employer and all the employees during which the content of the notice is discussed with the employees. The purpose of the consultation is for the employer to allow the employees to make representations regarding the proposed retrenchments.

Alternatives that are presented must be explored and discussed. If the alternatives are not workable and there are no further alternatives, the process can be finalised. Employees who are affected by the retrenchment must be informed of this in writing and receive the necessary documentation. The notice period begins when the employee becomes aware of the retrenchment.

If at any given moment of the consultations any employee suggests that they may be laid off voluntarily, the employer may accept this. If an employee chooses voluntary retrenchment, they must understand that they will not be able to claim unemployment benefits from the Unemployment Insurance Fund.

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Final compensation payout

This payment consists of the wage/salary, annual leave payout, statutory notice period payout, and severance package (only payable with retrenchment and consists of one week for each completed year of service). The notice period must still be paid out to the employee, even if the employee is not required to work it.

Layoffs: Five common mistakes to avoid include:

Do not identify employees to be laid off beforehand.
The reason for layoffs must be fair.
All parties must be consulted.
Selection criteria used must be fair and objective.
The final compensation payout must be correctly calculated and paid out.

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Compliance for Employers

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