Trained Employees

Training courses form a vital part of skills development and benefit both the employee and the business to function more effectively. Corporate training courses fill a particularly essential role as they supply companies with new skills and ideas from experts outside of the organisation.

Stay ahead of your competition by ensuring your staff are constantly advancing. With new skills and knowledge comes better performance and results to remain ahead in the marketplace.

Without attending training, managers would continue to pass on the same skills and information that they have received. By being introduced to new concepts and developments in industry and in the global market, managers will be better equipped in dealing with all aspects in the company including developing their staff.

Additionally, practical short duration training courses are the fastest way of gaining skills. By attending a course that is practical in nature and lead by an expert, delegates can leave the course with real skills – skills that would normally take significantly longer to master if the delegate was left to source via another avenue

Training courses also provide a very real benefit in terms of networking. Certainly, in the more management related courses, delegates often learn just as much from each other as they do from the lecturer. Vital knowledge and experience are shared between delegates and they learn valuable lessons from each other. Additionally, in a competitive business environment, it is often who you know that counts…by networking successfully on a training course, delegates can make truly valuable business connections.

Untrained Employees = Unhappy Employees. Employees who feel inadequate, underachieving, or unsupported are unhappy. They aren’t satisfied in their work, which will cause them to underperform, make mistakes, and not care about their work product. That costs the business in lost time and money.

Lost Customers. Untrained employees can cause many of the mistakes listed above, and those mistakes and inefficiencies can cause your business to lose customers. That is the worst possible scenario, but it can happen.

Tax Rebates

In addition to claiming learnership grants from your SETA, you can also claim a tax incentive when you register a learnership agreement with your SETA.

Learnership tax incentive was introduced to:

• Encourage skills development
• Job creation
• Providing an additional tax deduction for formal SETA registered training programmes

Types of deduction

Two types of deductions are available, namely:

1. Annual allowance: to which the employer is entitled in any year of assessment in which a learner is a party to a registered learnership agreement.
2. Completion allowance: during any year of assessment in which the learner successfully completes the learnership.

*The completion allowance is granted once-off in addition to the annual allowance and is deductible in the year of assessment in which the learner successfully completes the learnership, provided that sufficient proof of completion is supplied to SARS.

B-BBEE Benefits

Skills development is a priority element which amounts to 20 points (and 5 bonus points) of the total scorecard points. The minimum of 40% of the points within this element must be scored to avoid dropping a level. Companies can only score points on skills development if there is sufficient evidence indicating that black people are being trained in scarce and critical skills. This means that a company can include training conducted on any person that satisfies the definition of black as per the BEE Codes of Good Practise regardless of employment status.

Please note the following important amendments to the codes:

• Points increased from 15 to 20 (plus 5 bonus points).
• Spend has increased from 3% to 6% for total leviable amount (the total annual salary payroll)
• Trainees do not need to be permanent employees.
• Only 15% of your training spend can be used on internal/non accredited training.
• Learnerships must account for 5% of staff headcount, 100% gainful employment equals 5 bonus points.

Training is probably one of the easiest ways to boost your B-BBEE rating for maximum points.

Any grant funding received from your SETA still becomes part of your expenditure.

Learnerships increase your training spend without increasing costs and increase your B-BBEE score.

You can claim points for training in skills development, supplier development or enterprise development. You can score in two of the above three elements for one contribution. Learnerships for disabled employees allow you to score in all three elements.

It is important to note that full costs for expenses towards Skills Development Facilitators (SDF’s) can be claimed (salaries or invoices).

What are the limitations?

Only 15% of the value of informal, uncertified training will count towards total training expenditure.

Accommodation, catering and travel costs will also be limited to 15% of the total value.

*FOR YOUR CLAIM ON ANY TRAINING YOU WILL BE REQUIRED TO SUBMIT PROOF TO YOUR VERIFICATION AGENCY OF YOUR REGISTRATION WITH YOUR SETA AS WELL AS PROOF OF SUBMISSION OF YOUR WORKPLACE SKILLS PLAN AND REPORT.
YOU WILL BE REQUIRED TO SUBMIT YOUR EMP 201’S FOR THE MEASUREMENT PERIOD TO ENABLE THE VERIFICATION AGENCY TO CALCULATE THE TARGETS.

SETA

Funding-Discretionary Grants

The SETA shall allocate at least 80% of its total 49.5% discretionary grants within a financial year (1 April – 31 March) towards PIVOTAL programmes to address critical and scarce skills within its sectors as set out in the Sector Skills Plan (SSP) in accordance with the new Regulations.

This grant is applicable when an employer addresses the sectors scarce and critical skills through the following PIVOTAL programmes (Professional, Vocational, Technical and Academic learning programmes that result in occupational qualifications or part qualifications on the National Qualifications Framework).

• Learnerships – formally registered with the department of labour and contains both practical (70%) and theoretical (30%) components leading to a full qualification.
• Skills programmes – short courses (1 day, a week, a month, etc.), consisting of either one or more unit standards.
• Apprenticeships – on-the-job training and often some accompanying study (classroom work and reading) and enables practitioners to gain a license to practice in a regulated profession.
• Workplace Experience Placements – paid or unpaid, is part of a course of study and usually arranged through a university with an employer or by the student and is for an agreed period of time.
• Internships – a programme for candidates who have completed their training and still lack the workplace experience before they can be employed.

PIVOTAL training is an effective way to address your company’s succession planning training needs which include management and leadership skills and management training.

Learnerships are a great way to increase your training spend as you can count the salary of the learner as a training expenditure. Through the learnership process, the employer is able to increase the level of skills of his/her employees and reclaim the cost of the learnership fees from their SETA.

The employer must contact their SETA first to determine if they are eligible for SETA funding by providing a Letter Of Intent (LOI).

SDL Reimbursement-Mandatory Grants

All companies with an annual payroll of R500 000 and above must submit their Workplace Skills Plan (WSP), Annual Training Report (ATR) and Pivotal Report (PVT) to the relevant SETA for approval before 30th April every year. Failure to do this will result in a zero score on skills development as this is a strict requirement for the new B-BBEE codes.

The Mandatory Grant has an important function. It is designed to encourage employers to provide data to their SETA on their workforce and skills needs based on their WSP and ATR. The mandatory grant related to WSP’s and ATR’s stands at 20% of an employer’s 1% skills levy.

You will be able to claim back a large portion of money spent on training and upskilling your staff. The amount you can claim back from your SETA depends on your annual payroll.

These are the percentages that you can recover:

• 15% of the levy your company pays when you appoint and register a skills development facilitator.
• 10% of the levy when you prepare, submit and get approval for a workplace skills plan for the appropriate SETA.
• 20% of the levy when you prepare an annual training report based on your approved workplace skills plan.

Companies can claim the cost of training, facilitators, training venue costs, course fees and course material. There must be documentation to prove the above.