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Tech Financials | 24 February 2023 The COVID-19 pandemic worsened the unemployment crisis in South Africa. In the second quarter of 2021, unemployment rates were the highest ever officially recorded. Many people who lost their only source of stable income fell into poverty as a result. Social grants provide income that helps people to survive the short term economic hardship of unemployment. In the long term, new opportunities must be created to get people back into work. However, National Treasury’s emphasis on fiscal restraint has led to debates about which of these policies to prioritise. This has been particularly evident in the debate around the extension of a grant introduced during the pandemic, known as the Social Relief of Distress grant. Treasury extended the grant for another year in November 2022, but warned that financing the it would require additional revenue or reprioritising existing spending. Much of the discussion on the merits of the grant treats it as a competitor to employment-creation schemes in the budgetary allocation. However, the evidence compiled in our review of the job search assistance literature suggests that with careful design, the relief grant can help to support the policy priority of getting young people into work. Our research also suggests that the South African government should combine whatever replaces the grant with job search assistance programmes. Researchers have tested a number of job search programmes in South Africa and found promising evidence that they can increase employment. Further testing at a national scale could improve the design of these policies. Cash grants Research shows that cash grants can increase job-search. Simply receiving a cash grant encourages recipients of the grant, and other members of their household, to increase their search for jobs. This is in part because cash grants can be used to cover the costs of job search. One study of the labour market effects of the relief grant in South Africa found that the transfer increased the probability that a recipient would be active in the labour market by 25 percentage points. Increased job-search can’t address the structural lack of jobs. Nevertheless, increasing the number of applications that job-seekers submit can translate into improved employment outcomes. We argue the relief grant should be combined with enhanced job-search assistance programmes because they reduce unemployment by helping the labour market function better. Labour markets often don’t work optimally: job-seekers face barriers in looking for jobs and employers struggle to identify the right workers. These barriers can reduce employment rates as vacancies go unfilled. Job-search assistance programmes can reduce these “search frictions”, potentially improving employment rates, employment quality and earnings for workers. What works Job-search assistance covers a wide range of programmes that help people search for jobs, such as providing information about jobs, subsidies to cover search costs, job-search training or matching platforms like LinkedIn. A number have been tested in South Africa. Formal certification of communication and numeracy skills was found to substantially increase job search, employment and earnings. The low-cost testing and certification of the results provided job-seekers with a new method to share information about their abilities with potential employers. A scheme that encouraged young job-seekers to include a reference letter with their job applications and provided them with a simple template letter substantially increased employer call-backs, particularly for women. Training job-seekers to join and use LinkedIn increased employment for at least 12 months because workers gained better information about employers and were better able to communicate their skills. Encouraging young people to create an action plan for their job search increased job offers and employment by helping job-seekers to search more efficiently. There is international evidence supporting a range of job-search assistance programmes that could be implemented on South Africa’s National Youth Employment Platform, sayouth.mobi. This is a job-seeker database created and managed by the NGO Harambee. Delivering job-search assistance programmes through the platform could be an effective way to reduce costs and the administrative burden, and allow the government to reach a greater number of job-seekers. Programmes that provide job-seekers with information about the job market have been shown to encourage job seekers to obtain new training, consider new employment opportunities and increase interviews, earnings and employment. Policies delivered offline may further encourage job search. Providing airtime to job-seekers who are active on sayouth.mobi could increase job search. Workshops can be used to help participants prepare CVs and cover letters that effectively showcase their skills. In one study, workshops improved the quality of employment, but not employment rates. Peer group job-search clubs may also improve outcomes because job-seekers can support each other with the job search process, and because these clubs may decrease feelings of isolation, depression and low self-esteem, which are made worse by unemployment. In France, job search clubs with participants’ peers were more effective than one-on-one sessions with caseworkers. Mental health services for job-seekers could also be valuable to combat depression and low self-esteem. Moreover, depression may reduce job search effort. So, mental health services could be used to offset this effect. Next steps We argue that the extended grant should not have conditions attached. Conditions are difficult and expensive to set, monitor and implement. But labelling the grant as a “job-seekers grant” might be effective. It could encourage recipients to use the grant for job search without the need for stringent conditions that might reduce take-up. Related studies in Kenya and Morocco found that a labelled grant was as effective as a conditional grant. Our recommendation of combining cash grants and job-search assistance services is made on the basis of the best available evidence, but the policy has not been empirically tested at a national scale. We recommend that programmes be rigorously evaluated and phased in over time, based on the strength of their evidence base and the costs associated with implementing them. Kate Orkin, Associate Professor in Economics and Public Policy, University of Oxford; Ingrid Woolard, Dean, Faculty of Economic and Management Sciences, Stellenbosch University; Maya Goldman, Resesarcher, SALDRU, University of Cape Town, and Murray Leibbrandt, NRF Chair in Poverty and Inequality Research; Director of the Southern Africa Labour and Development Research Unit, University of Cape Town ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://techfinancials.co.za/2023/02/23/south-africas-relief-grant-how-it-can-be-used-to-help-young-people-into-jobs/

Brett Abraham & Mehnaaz Bux | 24 February 2023 Image source: Andriy Popov – 123RF.com From 1 March 2023, the earnings threshold will increase to R241,110.59, entitling employees falling below the new threshold to stricter protections in terms of labour legislation. The earnings threshold will increase to R241,110.59, representing a R17,030.11 increase from the earnings threshold that currently applies. The earnings threshold, a determination in terms of section 6(3) of the Basic Conditions of Employment Act (BCEA), impacts the applicability of certain of the provisions of the BCEA, the Labour Relations Act (LRA), and the Employment Equity Act (EEA). Employees who earn above the threshold are not entitled to certain of the protections afforded to those employees who earn below the threshold. What labour legislation says about earnings threshold Sections of the BCEA regulating ordinary hours of work, overtime, meal intervals, daily and weekly rest periods, Sunday pay, pay for work at night and on public holidays only apply to employees earning below the threshold. Employees earning above the threshold are not subject to the deeming provisions that apply to temporary employment services (labour brokers), and fixed-term employment provisions under the LRA. In the EEA, employees earning above the threshold are not allowed to refer disputes relating to unfair discrimination to the CCMA for arbitration unless it is related to sexual harassment, or all parties agree to arbitration. To be able to calculate whether an employee falls above or below the earnings threshold, the determination outlines what should be included in defining "earnings". An understanding of this is essential in seeking to minimise the risk of non-compliance with the BCEA. Importantly, "earnings" in this context must be differentiated from what may otherwise be included in "remuneration" in terms of the Ministerial Determination regulating the Calculation of Employee's Remuneration in terms of section 35(5) of the BCEA. Therefore, the increase to the earnings threshold may result in an increased number of employees becoming entitled to the stricter protections afforded by labour legislation such as overtime payments. This may, in turn, have financial consequences for employers. An assessment should be conducted by all employers to ensure that the increase and its consequences are accounted for in the workplace and, where necessary, changes to the employment contracts or remuneration structures are affected in order to mitigate the risks of any unintended contraventions of the BCEA or the deeming provisions applicable to atypical employment arrangements. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.bizcommunity.com/Article/196/607/236254.html

The Employment Equity Amendment Bill (the Bill) was published as Gazette #43535 of 2020. Parliament approved it on 17th May 2022. It is currently in the final stage of promulgation and is on the President’s desk for sign-off. The Bill's initial gazette was on 21st September 2018 as Gazette #41922 of 2018. It was in response to the slow pace of transformation in the workplace. At the time of going to print, the last update from the Department of Employment and Labour (DoEL) was a press release on 31st August 2022. It stated that the DoEL were preparing for the implementation and enforcement of the Bill from September 2023. Therefore, unless the President has any last-minute concerns about the constitutionality of the amendments contained in the Bill, the passage of the Bill and the amendments to the Employment Equity Act (EEA) will go ahead. What are the significant amendments to the Bill? The Bill presents three significant amendments, namely: 1. Employers with less than 50 employees, irrespective of turnover, will no longer fall within the ambit of a ‘designated employer’. As a result, some current designated employers will become non-designated employers and thus will not have to comply with the duties assigned to a designated employer. Promulgating section 53 of the Act provides for issuing certificates confirming a designated employer's compliance with the Act. The compliance certificate will be a prerequisite for any State procurement. The Minister of Labour will be empowered to determine sectoral numerical targets to ensure progress towards an equitable representation of people from designated groups at all occupational levels in the workforce. The focus of this article is to unpack the third point mentioned above, namely the sectoral targets. Firstly, we need to determine whether the contention that there has been a ‘slow pace of transformation’ is, in fact, true. Analysis of the average demographic statistics of employers reporting into the DoEL annually, contained in the Commission for Employment Equity Reports (CEE Reports) between 2009 and 2022, attests that the contention does hold water, especially when compared to the National Economically Active Population (EAP). The DoEL has identified the under-representation of African and Coloured men at the top, senior and middle management, women, as well as persons with disabilities at all occupational levels as the core areas of concern, as illustrated in the tables that follow: “The amendments to the Employment Equity Act will have far-reaching consequences for designated employers. Now is the time to review your organisation's transformation strategy.” A crude calculation of the ‘pace of transformation’ from the findings of the CEE Report between 2009 and 2022 generally indicates growth towards EAP alignment. However, comparing the 2022 CEE Report to the National EAP targets makes the reality of the ‘slow pace of transformation’ apparent. For example, take the variance between the overall actual statistics in the CEE Reports per race and gender group over the 13 years - 2009 to 2022 - is it possible to estimate the 'pace of transformation' per year? Comparing this 'pace of transformation' to the National EAP targets, is it further possible to estimate how long it will take until the demographic representation in the national workforce reflects that of the National EAP targets? The table below illustrates how long it would take for top and senior management to achieve the national EAP targets. In context, a generation is pitched to be between 20 and 30 years. So, using 20 years as the timeframe for a generation, it would take African men more than ten generations and African women more than seven generations to meet National EAP targets at Top Management. As a collective, women would only realise their National EAP targets at Senior Management by 2053. What is the status of persons with disabilities? Since the 17th CEE Report, the representation of persons with disabilities has been featured separately per occupational level. The target applicable for persons with disabilities for both employment equity and B-BBEE purposes is 2% of the total workforce. Although the representation of persons with disabilities improved at all occupational levels between 2017 and 2022, employers have, on average, not met the 2% target at any occupational level. At the current ‘pace of transformation’, for persons with disabilities at top management and the semi-skilled level, it would take five to eight years to meet the targets. Therefore, considering the findings of the CEE Reports against the National EAP and disability targets, it is safe to say that the DoEL’s contention of a ‘slow pace of transformation’ is correct, at least in terms of EAP and disability percentages. Hence the DoEL’s decision to institute sectoral targets. What is the status of the sectoral targets? The DoEL has confirmed that engagements on setting sectoral numerical targets began in June 2019. At the time of going to print, there was no confirmation, however, of whether these engagements were concluded. The next step is to publish the draft sectoral targets for 30-day public comment. Gazetting of the final sectoral targets will only happen once the President has given his assent to the gazetting of the EE Act Amendments. The amendments mean that designated employers must match or exceed the targets which the DoEL will set for five-year cycles at a time. Which sectors will the DoEL institute sectoral targets for? Below are the sectors where the DoEL will prescribe targets: What course of action should employers take until the gazetting of the Bill? Until the President assents to the gazetting of the amendments, the 2013 EE Act stands. Although, upon the gazetting of the Bill, smaller companies will become non-designated employers, all current designated employers, large and small alike, must continue to implement the duties outlined in the Act as it currently stands. In line with the current requirements, a designated employer must have an EE Consultative Committee, develop an EE Plan and report progress annually to the DoEL, among others. These are the duties of a designated employer, which a DoEL inspector will review. Will current EE Plans become redundant upon the publishing of the gazette? The timeframe communicated on 31st August 2022 implies that all current EE Plans will become redundant at the end of August 2023. Therefore, new EE Plans, which must include sectoral targets, must be ready for implementation from September 2023 onwards. One of the areas which may be confusing is the assumption that the sectoral targets will trump the EAP targets and that employers, therefore, will no longer need to align with the National EAP targets. On the contrary, designated employers must view sectoral targets as interim targets, which the DoEL will set to accelerate the pace of transformation, so that employers move more quickly towards the National EAP targets. Section 42(1)(a) remains intact and states: 1. “In determining whether a designated employer is implementing employment equity in compliance with this Act, the Director-General or any person or body applying this Act may ... take the following into account: (a) The extent to which suitably qualified people from and amongst the different designated groups are equitably represented within each occupational level in an employer's workforce according to the demographic profile of the National and Regional Economically Active Population. (b) “Whether or not the employer has complied with any sectoral target ...” will simply be an addition to the amendment and not a replacement. Pursuing the National EAP targets will put a designated employer in good stead to meet the sectoral targets. Therefore, designated employers with EE plans set to expire before the gazetting of the sectoral targets must base their new EE Plan on the National EAP targets, which a designated employer can then amend upon the gazetting of the sectoral targets. “At the current 'pace of transformation', it will take more than 200 years for South Africa to meet all National EAP targets at all occupational levels.” What happens if a designated employer cannot meet the sectoral targets? According to section 16 of the 2018 Draft Regulations issued as Gazette #41923 of 2018, a designated employer will have to justify any misalignment based on one or more of the following: o Insufficient recruitment opportunities; o Insufficient promotion opportunities; o Insufficient target individuals from the designated groups with the relevant qualification, skills and experience; o Court order; o Transfer of business; o Mergers or acquisitions; and o Impact on business from economic circumstances. Although the regulations remain in the draft, designated employers can use the draft regulations as a guideline of what will most likely be applicable in future. To conclude, the long-awaited EE Act Amendments present a mixed bag and will significantly impact how businesses implement transformation going forward. As the amendments necessitate designated employers to present a certificate of compliance to win State tenders, the cost of non-compliance could be grave. Consequently, designated employers must thoroughly consider all aspects of the amendments when plotting their new EE course of action. Until the amendments become effective, it is business as usual. Therefore, all current designated employers must ensure that the implementation of their EE Plans is in line with, and can withstand the scrutiny of, an Employment Equity Director-General review as per the 2013 Amendments. Any updates on the Bill's finalisation, or additional updates that will contradict the information provided in this article, will feature in the TFM Magazine/BEE Chamber’s weekly newsletter. Contact stella@bee.co.za to secure weekly electronic delivery of the newsletter. Click on the link below to download the PDF:

Upon the publication of the Codes of Good Practice in 2007, the prescribed format for all businesses in presenting their B-BBEE credentials was a B-BBEE certificate issued by a SANAS accredited B-BBEE rating agency or, until 2016, one prepared by the Standards Department of the Independent Regulatory Board for Auditors (IRBA). The 2013 amendments to the Codes of Good Practice, to remove the financial burden of a B-BBEEverification, allowed all Exempted Micro Enterprises (EMEs) to present a B-BBEE affidavit (affidavit) or CIPCB-BBEE certificate to confirm their level of 'Black' Ownership and Financial Revenue Threshold. Further amendments meant that Qualifying Small Enterprises with at least 51% 'Black' Ownership (BO QSE) could do the same. The amendments apply to all public and private organisations, as well as organs of state. On 3rd September 2018, Practice Guide 1 of 2018 was issued as a non-binding guide, purely to assist with the interpretation to ensure consistency in the application of the Act. Although the rationale behind an affidavit to confirm 'Black' Ownership and financial revenue was to remove the burden from small and ‘Black’-owned businesses, it does bring about challenges for an organisation at the time of its B-BBEE verification. One such challenge is brought about by the deponent incorrectly applying the Ownership calculation. Since the Commissioner of Oaths is likely not a B-BBEE specialist, such a miscalculation may go unchallenged. Unfortunately, such shortfalls in applying the Ownership calculation only become evident at the time of a B-BBEE verification, which can impact an organisation's Preferential Procurement score All sets of published Codes have a prescribed affidavit format, each with its financial threshold. The published Practice Note guides EMEs and BO QSEs in correctly submitting an affidavit in the prescribed format. Generic Enterprises are organisations that do not belong to a specific sector that falls within the ambit of a published Sector Code. Sector Specific Enterprises, where an organisation falls within the ambit of a Sector Code of Good Practice promulgated under the B-BBEE Act. Qualification is based on the sector from which an organisation derives more than 50% of its revenue. Specialised Enterprises exclude ownership status from the measurement benchmark. Such organisations qualify as non-profit organisations, public benefit schemes, organisations exclusively owned by organs-of-state, and those limited by guarantee or higher education. If an EME or BO QSE presents its B-BBEE status in any format other than a prescribed affidavit, it is invalid. Exceptions to the rule EMEs or BO QSEs falling within the ambit of the Transport Sector Code, as it has not been amended since 2007. Such organisations must present a B-BBEE certificate issued by an accredited SANAS B-BBEE rating agency or one prepared by their Accounting Officer. As per section 6.4 in Code Series 000, EMEs and BO QSEs that opt to tender for work to the value of R50m and above need to go through a B-BBEE verification through a SANAS-accredited B-BBEE rating agency. An affidavit relies on the honesty and integrity of a deponent. In turn, organisations trust the information presented in an affidavit to attain their Preferential Procurement targets. But, by the same token, those evaluating the validity of an affidavit should be able to recognise 'red-flag' areas and identify whether an affidavit is in the correct format and includes all necessary information. A deponent must ensure that the affidavit they present is representative of their business which also qualifies to use an affidavit to confirm its Ownership and financial revenue. For example, a QSE with less than 51% Ownership may not complete an affidavit; they must go through the B-BBEE verification process Validity of an affidavit for B-BBEE purposes The deponent must sign an affidavit in the presence of a ‘Commissioner of Oaths’ as per the requirements in the Justices of Peace and Commissioners of Oaths Act, 1963. Notably, a Commissioner of Oaths must be independent; therefore, they may not have had any direct connection to a deponent to avoid any conflict of interest. A Commissioner of Oaths signs and stamps the affidavit, binding it. No cost is attached to a 'Commissioner of Oaths' notarising an affidavit. Vital to ensuring an affidavit’s validity is: The date appearing on the affidavit and date stamp by the ‘Commissioner of Oaths’ must be the same. Any alterations, such as corrections, cross-outs or additions made to an affidavit, must be witnessed by both parties by initialling any alteration. The information requirements of an affidavit deponent are: 1. Name of the deponent as it appears in the identity document. The deponent must be an Owner, Director or Member of a business. 2. The deponent's South African identity number 3. Indicate the designation of the deponent. It will confirm that they are duly authorised to depose an affidavit on behalf of the organisation. 4. The name of the organisation as it appears on the registration documents 5. Indicate whether the organisation trades under a different name than the one registered. 6. Company registration number as per the enterprise registration documents issued by the CIPC at the time of registration. 7. Company VAT number, if applicable 8. The physical address where the business is operational. 9. Indicate the sector the organisation represents and the nature of the business 10. Black'-owned means a juristic person, having shareholding or similar member interest, that is B-BBEE controlled, in which Black' Participants enjoy a percentage of exercisable Voting Rights, Economic Interest and have earned all points under Net Value. These are determined under Code series 100, the total of such rights measured using the 'Flow-Through' Principle. If applicable, insert the percentage of 'Black' Ownership and beneficiaries, the definition of which is on page one of the affidavit. 11. If applicable, insert the percentage of ‘Black’ woman Ownership, percentage of ‘Black’ Women holding Voting Rights, Economic Interest and have earned all points under Net Value. These are determined under Code series 100, the total of such rights measured using the 'Flow-Through' Principle. 12. If applicable, insert the percentage of Ownership held by 'Black' Designated Groups. The definition appears on page one of the affidavit. 13. If applicable, insert the total Ownership held by ‘Black’ Youth, which are people between the ages of 14 and 35. 14. If applicable, insert the total Ownership held by 'Black' People with disabilities as defined in the Code of Good Practice on the employment of people with disabilities issued under the Employment Equity Act. 15. If applicable, insert the total Ownership held by ‘Black’ Unemployed People, which category relates to 'Black' People that are not attending, and not required by law to attend, an educational institution and not awaiting admission to such an institution. 16. If applicable, insert the total Ownership held by 'Black' People living in rural and undeveloped areas 17. If applicable, insert the total Ownership held by ‘Black’ Military Veterans. The Defence Sector Code clarifies the qualifying criteria for ‘Black Military Veterans’. For this definition, it relates to any ‘Black’ South African Citizen who: Rendered military service to any of the Non-Statutory Military Organisations that were involved in South Africa’s Liberation between 1960 and 1994; Served in the Union Defence Force before 1961; Became a member of the new South African National Defence Force after 1994; and Completed their military training but no longer perform military services and were not dishonourably discharged from that military organisation or force. The definition does not exclude any person referred to in paragraphs 4.5.1 or 4.5.2 who could not complete their military training due to an injury during military training or contracted a disease. 18. Include the date of the latest financial year- end-for example, 28th February 2022. 19. Tick the box that indicates the ‘Black’ Ownership status, which will allocate an organisation’s Preferential Procurement Recognition level. 20. Full signature of the deponent. The deponent must sign the affidavit in the presence of a 'Commissioner of Oaths' with no conflict of interest. 21. Must include the day, month and year of notarisation. Important to note that the date must be the date that appears on the notarised stamp or the affidavit is invalid 22. ‘Commissioner of Oaths’ to sign and stamp the affidavit. To reiterate – if the day, month and year featuring under the deponent's signature in any way differs from that of the 'Commissioner of Oaths', the affidavit is deemed invalid. Click on the link below to download the PDF:

Alinaswe Lusengo | 22 February 2023 From left. Associate Professor and Director, Centre for Social Development in Africa, Professor Lauren Graham | Co-founder and Chair, Bank Zero and Former CEO of First National Bank, Michael Jordaan | Business Maverick Journalist, Ray Mahlaka. (Photos: Supplied) SMMEs can play a critical role in addressing South Africa’s youth employment crisis. However, a lack of education, opportunities and experience and an ailing economy can significantly impact the ability of young people to gain employment with SMMEs. Participants on a Daily Maverick webinar panel this week discuss the challenges faced by small businesses and the young people vying to be employed by them. Over 9 million people aged 15-34 are unemployed, in education or in training, according to a report released by Youth Capital. This means that four out of 10 young people are struggling to find work or unable to access the education or training needed to find work. In an economic climate where tertiary education is no longer a guarantor for employment and many students protest in the face of steep financial burdens and debt, looking for solutions to high youth unemployment is a complex matter. On Tuesday, 21 February, Daily Maverick hosted a webinar with Professor Lauren Graham and entrepreneur Michael Jordaan that was moderated by Business Maverick journalist Ray Mahlaka. The webinar, titled Now hiring: the role of SMMEs addressing the youth unemployment crisis, delved into the ways that small, micro and medium enterprises (SMMEs) can serve as vehicles to address and help solve youth unemployment. SMMEs and employment Though there is no standardised definition, Jordaan explained that SMMEs are typically understood as businesses with a small number of employees and a low annual turnover. In South Africa, an SMME is a business that has between 1-200 employees and an annual turnover of less than R100-million. Jordaan went on to reveal that over 60% of all employed people in South Africa are working for businesses that have fewer than 50 employees. This highlights what an important sector SMMEs are, seeing as they employ so many South Africans. When asked what makes it possible for SMMEs to provide employment opportunities, Graham noted that SMMEs often rely on their employees as opposed to being more capital-intensive like bigger businesses. “The question, then, is how do we make sure that we can best support [SMMEs] so that they are able to bring young people into their businesses in a way that is both good for the SMME and good for the young person,” she remarked. Challenges facing unemployed youth Graham added that many SMMEs are recruiting through social networks and many South Africans find their work through social networks as opposed to formal channels of recruitment. The problem with this is that many unemployed young people fall outside these social networks, and over 40% of people not in employment, education or training come from households where nobody is employed. Graham suggests that SMMEs need to work with youth employability programmes to encourage formal recruitment channels and support young people seeking employment. Harambee is an example of a youth employability programme that ensures young people can not only find jobs but are adequately prepared for the workplace. Another key challenge is work experience requirements for jobs, where entry-level jobs often seek several years of work experience as a prerequisite, which many applicants do not have. It feeds into a cycle where one cannot acquire a job because one needs work experience yet in order to gain work experience, one needs to get a job. Graham explained that being able to attain work experience is a matter of privilege. Young people who have access to social networks that can get them internships or vacation work are able to acquire the work experience the labour market seeks. Challenges facing SMMEs Not only are young people struggling to find employment, but the SMMEs who are meant to be employing them also face their own set of challenges. Jordaan emphasised that the problems South Africa has on a national level are affecting SMMEs. Rolling blackouts, for example, are a major concern as they are stunting economic growth and forcing some SMMEs out of business. When the economy displays growth, it is an indicator that employment levels will grow too and Jordaan hopes that the government can take economic growth seriously — especially with the upcoming Budget Speech — for the sake of employment levels. Bureaucratic processes, or red tape, were flagged as another challenge facing SMMEs. Jordaan believes that we need to minimise red tape in order to make it easier for SMMEs to employ people, especially younger people. Graham added that complex bureaucratic processes are hindering SMMEs as they discourage or even obscure important policies that can provide relief to SMMEs such as the Employment Tax Incentive (ETI). The ETI encourages businesses to hire young and less experienced job seekers by reducing the cost of hiring this demographic. There is still hope Both Graham and Jordaan acknowledged that the journey of tackling youth unemployment will be an arduous one. It is a complex issue that requires nuanced solutions. They can both testify to how much is being done to try and intervene and create jobs for the youth. Graham and Jordaan stated that despite the issues at hand, they are both still hopeful that there is a future in South Africa where young people will be employed. SMMEs are incredibly important in helping facilitate a country where that future is possible. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’ https://www.dailymaverick.co.za/article/2023-02-22-small-businesses-a-viable-path-to-youth-employment-but-equity-obstacles-need-to-be-addressed/

Francis Marimbe | 22 February 2023 Under the ownership scorecard, 5 points out of 25 are allocated to black women, and 5 out of 19 under the management control scorecard, says the writer. Achieving sustainable development goals of promoting gender equality in all facets of life, decent work for men and women, and reducing inequality is a challenge that has mainly affected women across the globe. Many policies and programmes have been implemented to empower women, strengthen their societal position, and contribute to economic development. In South Africa, the post-apartheid period overlooked gender issues in the mammoth task of eradicating racism and sexist laws. However, the government of South Africa has rigorously embarked on gender programmes, the development of comprehensive machinery, and critical programmes concerning women empowerment, reducing poverty, and ending violence against women. There is no doubt that there has been a steady increase in women’s representation, especially in governance positions and decision-making processes at the national level. Such representation is not the same at the provincial and local levels. Statistics show that women occupy only a few government managerial positions. Statistics South Africa (2018) demonstrates that women accounted for 43.8% of total employment in the second quarter of 2018, with only 32% of women managers. A report published by the Department of Public Service and Administration (DPSA) in 2020 showed that most women occupy lower managerial positions, and their earnings are less than men. The labour market tends to favour men more than women in paid employment, regardless of race. The Commission for Employment Equity Annual Report for 2021/2022 shows that over three years on equitable representation, 55.3% counts for men and 44.7% for women, with a gap of 7.8% between African men and women. Male representation in top management is around 75% and 25% for women, while at the semi-skilled level, the difference is approximately 10%. Such statistics show that black women are under-represented in the public and corporate sectors. Most of them are employed in elementary and domestic work occupations, and men dominate the rest. While these challenges exist, it is pertinent to note that the Broad-Based Black Economic Empowerment (B-BBEE) Act and the Codes of Good Practice have made a perceptible contribution to women’s empowerment. Within the five elements of the B-BBEE (ownership, management control, skills development, enterprise and supplier development, and socio-economic development), the inclusion of women is highlighted in four elements except in the socio-economic development scorecard. This clearly shows the government’s commitment to the involvement of women in transformation and development. Under the ownership scorecard, 5 points out of 25 are allocated to black women, and 5 out of 19 under the management control scorecard. A qualified small enterprise (QSE) general scorecard shows that out of the available 25 points, there are 7 points allocated to black women. On a skills development generic scorecard, the economically active population (EAP) racial demographics are used where the female percentage is considered. Lastly, under preferential procurement using the amended construction scorecard, there are 3/4 points for spend on empowering suppliers with at least 35% black female ownership. In addition, there is a bonus point on spend on empowering suppliers with at least 51% black female ownership and 2 out of 15 points under supplier development specific to the annual value of all qualifying supplier development contributions to 51% black women-owned entities, depending on the scorecard used. The Amended Generic B-BBEE Codes of Good Practice has a weighting of 111 points in addition to bonus points on skills development (5 points) and enterprise and supplier development (4 points), amounting to a total of 120 points. At least 20% of the total points are dedicated to women’s empowerment and inclusion. Based on the statistics and BEE points allocated to women, I believe the allotted points towards black women are insufficient in addressing women’s empowerment and their contribution to economic development unless strict measures are implemented. Therefore, sustainably addressing women’s empowerment through B-BBEE would require a compulsory 100% compliance on all points allocated to women on management control, skills development, and preferential procurement scorecards. Failure to meet the possible mandatory 100% compliance should lead to discounting a BEE level instead of emphasising the compulsory ownership element. Such an element mainly benefits a few wealthy people who can afford to enter into ownership deals in an environment threatened by fronting practices. A move to compulsory 100% compliance could significantly contribute to women’s empowerment and inclusion in managerial positions, thereby reducing the gap between men and women. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.iol.co.za/news/politics/opinion/a-compulsory-100-black-women-score-on-the-b-bbee-scorecard-is-the-panacea-to-women-empowerment-challenges-73bdfc15-a7dd-40c5-8044-7a48dae5ac79

Dr Michael Cardo MP and Jan de Villiers MP | 22 February 2023 The DA is concerned with the recent announcement of a 9.7% increase in the national minimum wage. This is a significant increase, well above the National Minimum Wage Commission’s original recommendation of inflation plus 50 or 100 basis points. With inflation hovering around 6.9%, a more reasonable increase would have been 7.9%. The fact that the government has chosen to ignore this recommendation is a clear indication of its disregard for the well-being of small businesses and the unemployed. Few sectors will be able to absorb such steep increases at a time of serious economic decline. The government’s decision to implement this above-inflationary increase in the minimum wage will have a detrimental effect on small and medium-sized businesses; they are already struggling to cope with rampant load shedding, rising inflation, and other economic challenges. This increase will only add to the burden of businesses, which will be forced to absorb the additional costs and pass them on to consumers, thereby exacerbate the cost-of-living crisis which is already affecting millions of South Africans. Small businesses are the backbone of our economy; they have enormous potential to create jobs. These businesses will be disproportionally affected by the 9.7% minimum wage increase. They cannot be expected to bear the brunt of government’s failure to adopt a more inclusive labour market framework, and this above-inflationary increase which will leave them with no other choice but to shed jobs, thus fuelling South Africa’s already high unemployment rate. It is imperative to liberalize the labour market and promote a more business-friendly environment. The current approach of imposing above-inflationary increases in the minimum wage without considering the impact on small businesses is counterproductive and unsustainable. We call on the government to reconsider the above inflationary increase in minimum wages. In a country with unemployment as high as South Africa’s, we should be pricing people into jobs, not out of them. The DA remains committed to fighting for the rights and well-being of small businesses and the unemployed. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.da.org.za/2023/02/mandatory-above-inflation-minimum-wage-increases-will-fuel-job-shedding-and-hamstring-small-businesses

Bizcommunity | 22 February 2023 New National Minimum Wage (NMW) hourly rates, which will have a significant impact on labour-intensive industries, were published by the Minister of Employment on 21 February 2023, in line with section 6(5) of the National Minimum Wage Act. They will take effect from 1 March 2023. Employers need to be aware of the new higher National Minimum Wage rates from 1 March and to take these rates into account when they engage in collective bargaining agreements. The NMW rate increases from R23.19 to R25.42 per hour. The National Minimum Wage Commission recognised the importance of providing all wage-earning workers with a sufficient income to support themselves and their families at a socially acceptable and economically viable level. The decision to implement the wage increase must however be balanced against the need to avoid job losses and contribute to reducing South Africa's high unemployment rate of 7.7 million jobless individuals , as reported by StatsSA in the third quarter of 2022. The NMW is a relatively blunt instrument for poverty and inequality reduction in South Africa if it is not implemented with other effective poverty reduction strategies. This increase will have a significant impact on labour-intensive industries such as mining, agriculture, private security, wholesale and retail trade, and hospitality. Some sectors have unique collective bargaining approaches resulting in industry-specific agreements on rates of pay that cater for their production requirements and viability. Other sectors may need to consider adjusting their working hours and engaging in more rigorous collective bargaining to align with the new NMW rate. Collective bargaining has often given rise to sector-sensitive solutions that benefit the workforce, such as those in Contract Cleaning, where the minimum wage increase is above the NMW, depending where the services are rendered in terms of categorised geographies. The Wholesale and Retail sectors are also governed by separate rates of pay, with different rates of increase across different job categories. The increases are subject to the geographical areas set out in Area A and B. Minimum wage rates prescribed for Area A are incrementally higher than those prescribed for Area B, as the job categories progress toward higher-paying positions. For example, a general assistant, trolley collector, security guard, forklift operator, and driver in Area A are entitled to the NMW. The Minister has gone a step further by prescribing minimum hourly rates in excess of the NMW for higher-ranking positions in the wholesale and retail sectors. In light of the new NMW rate, it is essential for employers to review their wage policies and engage in collective bargaining to ensure compliance, if the increases prove to be disruptive to the viability and continuity of their businesses. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.bizcommunity.com/Article/196/863/236213.html

24 February 2023 Although entering into an Enterprise or Supplier Development loan contract is generally done with the best intentions, some loans issued will inevitably be defaulted on or, in the worst case, a Beneficiary will refuse to repay it. When giving a loan, an organisation has the full rights of recovery; however, this has to be clear in the terms and conditions. First and foremost, a loan must take the form of a debt instrument; thus, it must never be a grant disguised as a loan. Any loan made with the intention of not receiving repayment of the capital amount is not a loan but a grant and must be claimed as such. Consequently, claiming a loan under Enterprise or Supplier Development instead of a grant is Fronting Practice. However, if a beneficiary fails to repay a bona fide loan, an organisation may offer a Beneficiary a grant which will allow them to repay the loan. Otherwise, an organisation can write off the loan or follow the legal route based on the terms and conditions of a particular loan. Enterprise & Supplier Development Services are available to is available to guide members to ensure their contracts align with the requirements of the relevant code.

24 February 2023 B-BBEE Sector Codes of Good Practice (Sector Codes) vary from each other as they do from the General B-BBEE Codes of Good Practice (Generic Codes). However, if a Sector Code is silent on a matter, the matter reverts to the Generic Codes. In the case of the Amended AgriBee Sector Code (AgriBee), "Absorption" is defined as follows: "means a measure of the Measured Entity’s ability to successfully secure formal permanent or long-term contract employment for a Learner or to assist a Learner further their education and training". The differentiation in this case between the Generic Codes and AgriBEE is the inclusion of the words “permanent” and ”further education and training”. Technical Services are available to assist members measured on a Sector Codes.

24 February 2023 The Construction Sector Code differs from others as it does not incorporate Enterprise Development as an element. Therefore, what happens if an organisation is measured on the Generic Codes, but its Enterprise Development Beneficiary is subject to the Construction Sector Code? There is no cross-implementation in Generic Codes and Sector Codes; an organisation is measured on either/or. In this case, such an Enterprise Development Beneficiary will be subject to the definition laid out in the Generic Codes. Important to note is that where a matter is silent in any Sector Code, it reverts to the Generic Codes and not vice versa. Enterprise & Supplier Development Services are available to assist Members in hosting beneficiaries outside the ambit of the code they are measured on.

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