Flawed EEA9 with six instead of seven true levels.

In any event all jobs in the top two levels never exceed 2% of all jobs in an organisation.  In addition the inherent job requirements at these top levels cannot be determined by demographic considerations.  Criticism by the Minister of Labour of the slow pace of transformation at top and senior management levels creates the wrong impression because there has been real progress from 2000 to 2012.  Here are the  facts:

  •  8.2% average annual increase  in the number of employees.
  • Material demographic shift across all levels.
  • Creation of opportunities to develop equality as the ‘blueprint’ for all human resource, skills and BEE activities.

Table I – shows EEA9 after creating an extra middle level

Table II – shows official reporting progress from 2000 – 2012

 

 

 

 

 

 

Table I

The employees currently locked into the 4th level in EEA9 are deprived of intentional, continuous and systematic development and are unlikely to receive the correct development attention.

There is also a breach of the legal requirement to eliminate ‘disproportional income differentials’ in that two levels are trapped in one level.

By making this essential adjustment there would have been an increase in the extra level of 172% (from 184,450 to 501,020) between 2000 and 2012.

In addition in both 2000 and 2012 these employees formed a larger group than all employees reported to be in the three levels above them.

Table II

The distribution of employees across all levels as a percentage of the grand total (columns B & F) has improved.   The average annual increase is 8.2% from 2000 to 2012 in the number of employees included in reports (columns A & E).

The demographic split between blacks and whites are shown in columns C & D (2000) and G & H (2012) and there has been significant growth in the number of blacks employed in all levels (columns G & H).

A simple year on year comparison, such as 2011 and 2012, cannot indicate accurately organisational change because  organisational growth and development takes time.

The Department of Labour needs to build on the success of the past 12 years by reviewing the decision-making level framework (form EEA9) because it is not an original creation.

The original framework was ‘concocted’ in the mid 70s when workplaces were extremely racialised and groups postured to protect their relative positions.   Form EEA9 is now the only framework being used despite having evolved in the era when it was never intended to create opportunities for individual and organisational growth.

This is illustrated by the current 4th level (skilled technical……) highlighted in red.

The 4th level is the ‘engine room’ of all organisations.  It is impossible to include in that one level all of the following employees because it is unfair and denies them organisational development opportunities:

  • skilled technical
  • academically qualified
  • junior management
  • supervisors
  • foremen
  • superintendents.

In effect by not differentiating properly it probably amounts to discrimination

Experience shows that between 35% – 40% of all employees in this level are potential candidates for development into the ‘managerial’ stream and need to be in their own  separate 4th level.

Negative impact

The development of management in South Africa has been negatively affected during the last 14 years by this flaw in EEA9.   This flaw needs to be remedied to avoid a number of serious consequences, including:

  • employers being negatively affected in their accreditation ratings because B-BBEE accreditation elements have been reduced to 5 with employment equity and skills development being 2 of the 5 elements; and
  • the Department finding it difficult to punish and fine employers for non-compliance with the Act.

Please refer to the earlier post as well for more information on this topic:

Relative deprivation and the need for proportional pay differentials.

New EEA9: Levels in terms of Section 21 of the Act

PAGE 1 OF 2 EEA9
Department:
Labour
REPUBLIC OF SOUTH AFRICA

 

OCCUPATIONAL LEVELS
WHAT IS THE PURPOSE OF THIS ANNEXURE?
Job evaluation or grading systems are used by many organisations to measure jobs according to their content and establish the comparative worth between jobs.
This annexure provides a table of equivalent occupational levels that may be used by employers when completing the EEA2 and EEA4 forms.
INSTRUCTIONS
The table below indicates the occupational levels within organisations as developed through the use of different job evaluation or grading systems. The table provides equivalent levels from each of these job evaluation systems.
Organisations that do not have job evaluation and grading systems should use the table below for guidance to determine the occupational levels in their organisations.

 

2 of 2   EEA9
OCCUPATIONAL LEVELS Paterson Classic (levels) Paterson Modern (bands) Re-Measure ©(points) Hay Units ©(points) Hay Decision Tree (© points) Peromnes ©(points) Task© (levels) JEasy© (levels) DESCRIPTION
Top Management/
Executives
F+1-F+5 G Band1 300-349 3581-7160 1++ Controls the functional integration of the business. Determines the overall strategy and objectives of the business. Directs the company into the future. The nature of the work and focus is long-term. Sign-off on policy or strategy.
F1-F5 F Lower-F Upper 250-299 1801-3580 225-275 1 to 1+ 23-26 6a-6e
Senior Management E1-E5 E Lower-E Upper 200-249 735-1800 175-224 4-2 18-22 5a-5e Knowledge of entire business area/BU/company or group. Provide inputs for/formulation of the overall Organisational strategy. Translates the overall strategy into business plans for BU/Functional Unit, thereby operationalising organisational strategy. Implements and manages business plan, goals and objectives and ensures the achievement of overall key Organisational/BU/Functional outputs. Manages the development of innovation and change.
Professionally Qualified & experienced specialists/mid-management D1-D5 D Lower-D Upper 150-199 371-734 125-174 7-4 14-18 4a-4e Professional knowledge of sub-discipline or discipline. Provide input in the formulation of Organisational/Functional Unit business plans. Formulate and implement departmental/team plans that will support the BU business plans. Optimisation of resources (finances, people, material, information and technology) to achieve given objectives in most productive and cost effective way.
Skilled Technical & Academically Qualified/Junior Management/
Supervisors/
Foremen/
Superintendents
C1-C5 C Lower-C Upper 100-149 192-370 75-124 11-7 9-13 3a-3e Applies broad knowledge of products, techniques and processes. Evaluates procedures and applies previous experience. A good solution can usually be found. Determines own priorities. What has to be done is stipulated; but may require initiative in terms of how it should be done.
Semi-Skilled & discretionary decision-making B1-B5 B Lower-B Upper 50-99 85-191 25-74 15-11 4-8 2a-2e Accountable for direct product, process or service quality. Incremental improvement of existing processes and procedures according to clear guidelines. Choosing of correct action on the basis of set standards, training procedures and past experience.
Unskilled & defined decision-making A1-A3 A 20-49 54-84 0-24 19-16 1-3 1a-1c Steps to accomplish work or processes are clearly defined and understood. Tasks are sometimes repetitive and uncomplicated and the work cycle is short.

Footnotes

1   The F+1 – F+5 levels are commonly referred to as the G Band in industry and extend beyond the Paterson Classic F5 band.

New EEA4: Statement of income differentials in terms of Section 27 of the Act

Department: Labour
REPUBLIC OF SOUTH AFRICA
PLEASE READ THIS FIRST SECTION A: EMPLOYER DETAILS & INSTRUCTIONS
PURPOSE OF THIS FORM

This form enables employers to comply with section 27 (1) of the Employment Equity Act 55 of 1998 as amended.

This form contains the format for Income Differential Statement to be completed by designated employers to the Employment Conditions Commission.

WHO COMPLETES THIS FORM?

All designated employers who are required to submit a report in terms of section 27 (1) of the Employment Equity Act, 55 of 1998 as amended. Employers who wish to voluntarily comply with the reporting requirements of the Act are also required to complete this form.

WHEN SHOULD EMPLOYERS REPORT?

Designated employers must submit the Income Differential Statement annually on the first working day of October or by 15 January of the following year in the case of electronic reporting.

Employers who become designated on or after the first working day of April but before the first working day of October must submit their Income Differential Statement on the first working day of October of the following year.

SEND TO:

Employment Equity Registry
The Department of Labour
Private Bag X117
Pretoria 0001

Online reporting: www.labour.gov.za
Helpline: 0860101018

NO FAXED OR E-MAILED
REPORTS WIIL BE ACCEPTED

Trade name
DTI registration name
DTI registration number
PAYE/SARS number
UIF reference number
EE reference number
Seta classification
Industry/Sector
Telephone number
Postal address
Postal code
City/Town
Province
Physical address
Postal code
City/Town
Province
Details of CEO/Accounting Officer at the time of submitting this report
Name and surname
Telephone number
Fax number
Email address
Details of Employment Equity Senior Manager at the time of submitting this report
Name and Surname
Telephone number
Fax number
Email address
Business type
Private Sector State-Owned Enterprise
National Government Provincial Government
Local Government Educational Institution
Non-profit Organisation
Information about the organisation at the time of submitting this report
Number of employees in the organisation 0 to 49
50 to 149
150 or more
Is your organisation an organ of State? Yes
No
Is your organisation part of a group/holding company? Yes
No
If yes, please provide the name
Year for which this report is submitted

 

SECTION B: THE FOLLOWING MUST BE TAKEN INTO CONSIDERATION WHEN COMPLETING THE EEA4 FORMS
1.    All employees (including Foreign Nationals) must be included when completing the EEA4 form in the appropriate space provided in the table below. Temporary employees are employees employed to work for less than three months.
2.   Calculation of remuneration must include twelve months, which must be in line with the period covered by the EEA2 reporting form. In the case of employees who have not worked a full twelve month period an amount equivalent to the annual salary should be furnished, e.g. if a person worked for three months and earned R30 000, the annual equivalent will be (R30 000/3) 12, which means the annual equivalent for this person will be R120 000. All payment amounts to be reflected in the table below must be rounded to the nearest Rand (R) and included as total remuneration for each group in terms of race and gender.
3.    No blank spaces, commas (,), full stops or decimal points (.) or any other separator should be included when capturing the payment amounts in each of the cells in the table below – for example R7 345 567.22 must be captured as 7345567 with no separators.
4.    The payments below indicate what must be included and what must be excluded in an employee’s remuneration for the purposes of calculating pay in order to complete the EEA4 form.
4.1. Included
(a)   Housing or accommodation allowance or subsidy or housing or accommodation received as a benefit in kind;
(b)   Car allowance or provision of a car, except to the extent that the car is provided to enable the employee to work;
(c)   Any cash payments made to an employee, except those listed as exclusions in terms of this Schedule;
(d)   Any other payment in kind received by an employee, except those listed as exclusions in terms of this Schedule;
(e)   Employer’s contributions to medical aid, pension, provident fund or similar schemes; and
( f )   Employer’s contributions to funeral or death benefit schemes.
4.2. Excluded
(a)    Any cash payment or payment in kind provided to enable the employee to work (for example, an equipment, tool or similar allowance or the provision of transport or the payment of a transport allowance to enable the employee to travel to and from work);
(b)    A relocation allowance;
(c)    Gratuities (for example, tips received from customers) and gifts from the employer;
(d)    Share incentive schemes;
(e)    Discretionary payments not related to an employee’s hours of work or performance (for example, a discretionary profit-sharing scheme);
( f )   An entertainment allowance; and
(g)    An education or schooling allowance.
5.    The value of payments in kind must be determined as follows—
(a)    a value agreed to in either a contract of employment or collective agreement, provided that the agreed value may not be less than the cost to the employer of providing the payment in kind; or
(b)    the cost to the employer of providing the payment in kind.
6.     An employee is not entitled to a payment or the cash value of a payment in kind as part of remuneration if—
(a)    the employee received the payment or enjoyed, or was entitled to enjoy, the payment in kind during the relevant period; or
(b)    in the case of a contribution to a fund or scheme that forms part of remuneration, the employer paid the contribution in respect of the relevant period.
7.    If an employee’s remuneration or wage fluctuates significantly from period to period, any payment to that employee in terms of the BCEA must be calculated by reference to the employee’s remuneration or wage during—
(a)    the preceding 13 weeks; or
(b)    if the employee has been in employment for a shorter period, that period.

 

SECTION C: INCOME DIFFERENTIALS STATEMENT
Please use the table below to indicate the number of employees, including people with disabilities, and their remuneration in each occupational level in terms of race and gender.
Occupational levels

(why only 6 not true 7?)

MALE FEMALE FOREIGN NATIONALS Total
A C I W A C I W M F
Top Management

(level 6 & 7?)

Number of workers
Remuneration
Senior Management

(level 5)

Number of workers
Remuneration
Professionally qualified and experienced specialists and mid-management

(level 4)

Number of workers
Remuneration
Skilled technical and academically qualified workers, junior management, supervisors, foremen and superintendents

(level 3)

Number of workers
Remuneration
Semi-skilled and discretionary decision making

(level 2)

Number of workers
Remuneration
Unskilled and defined decision making (level 1) Number of workers
Remuneration
TOTAL PERMANENT Number of workers
Remuneration
Temporary employees Number of workers
Remuneration
TOTAL Number of workers
Remuneration

 

SECTION E: Signature of the Chief Executive Officer/Accounting Officer
Chief Executive Officer/Accounting Officer
I (full Name) CEO/Accounting Officer of
hereby declare that I have read, approved and authorized this information.
Signed on this      day of                            (month) year
At (place):
Chief Executive Officer/Accounting Officer