Chapter 6 - Labour Law
The Skills Development Act No 97 of 1998 was passed in order to develop and improve the skills of people in the workplace. The Act does the following:
The Department of Labour has published a guide called ‘An employer’s guide to the Skills Development Levy’. If you need more information contact your nearest Labour Centre for a copy.
The NQF is a plan for education and training. The aim is for people to continue accumulating qualification credits as they learn and work. The Skills Development Act defines the following structures to implement the NQF:
The Skills Development Levy was established under the Skills Development Act. A levy is an amount of money that employers have to pay to the South African Revenue Service (SARS) for skills development of employees. If employees undergo training then the employer can claim this amount back from the relevant SETA.
An employer must pay a skills development levy every month if:
The employer must register with SARS and pay the levy monthly. SARS will supply the correct forms to fill in (SDL 201 return form). The levy must be paid to SARS not later than 7 days after the end of every month.
The levies paid to SARS are put in a special fund. 80% of the money from this fund will be distributed to the different SETAs and the other 20% will be paid into the National Skills Fund. The SETAs will then pay grants to employers who appoint a Skills Development Facilitator. The National Skills Fund will fund skills development projects that don't fall under the SETAs.
An employer can get money back from the SETA or the National Skills Fund to use on training and developing their own employees' skills. To qualify for a Skills Development Grant an employer must:
An employer can get back 50% or more of the levies they paid to SARS. These grants are called Grants A, B, C and D. This is how the grant system works:
Grant A - When an employer appoints and registers a Skills Development Facilitator, then Grant A is paid back to the employer. This is 15% of the levy paid to SARS by the employer. Employers can only get Grants B, C and D if they have got grant A.
Grant B - When the employer sends in a workplace skills plan to the relevant SETA and the SETA approves the plan, then Grant B is paid. This is 10% of the levy paid to SARS by the employer. Employers can only get Grant C if they have got grant B.
Grant C - When the employer sends an annual training report based on the approved workplace skills plan, then Grant C is paid. This is 20% of the levy paid to SARS by the employer.
Grant D - SETAs may pay out grant D for specific sector skills initiatives in the workplace. Grant D is 5% of the levy paid to the Fund by the employer.
If employers do not meet the requirements for recovering a grant then they lose the grant.
The Skills Development Act makes provision for the employment and use of a Skills Development Facilitator by an employer. This person is responsible for developing and planning the skills development strategy of a business for a specific period. The Skills Development Facilitator must do the following tasks:
An employer can appoint an employee or a formally contracted person from outside the business to perform the functions of a Skills Development Facilitator.