Skills development in the workplace

By Rob Paddock

SDA, SDLA, SETA, SAQA, NQF, ETQA, CHE

Some form of secret coded language? Perhaps the electronic password to a Swiss bank account? It must at least be military communication. I’m afraid not. These are just a few examples of the lingo thrown around in education, training and accreditation circles. In this article I hope to unpack the first three acronyms listed above, and in a subsequent article we will look at the last four.

The Skills Development Act 97 of 1998 (SDA) and the Skills Development Levies Act 9 of 1999 (SDLA), along with several regulations are in place to encourage companies to develop a training strategy and to provide a financial incentive to implement the training.

The Levy
For organisations whose annual payroll exceeds R500 000, a compulsory skills development levy (one per cent of the organisation’s monthly payroll) must be paid to the South African Revenue Service (SARS).

Currently, SARS gives all the money received from the SDL over to the appropriate Sector Education and Training Authority (SETA). Seta’s are industry training boards. Each separate economic sector has one Seta that administrates the levies for the sector into which the organisation falls. The Seta can currently take 10 per cent (maximum) of the total levy for administration costs, which is unrecoverable by the employer.

Fifty per cent is claimable in a mandatory grant claim by the company that paid the SDL, provided that they submit a workplace skills plan and an annual training report. Twenty per cent is claimable through the discretionary grant applications – although this is not always guaranteed.

The final twenty per cent is put towards the Department of Labour's National Skills Fund for large public skills development projects

The grants
In order to claim back some of the money paid out in their SDL, employers must submit reports to their SETA proving completion of certain prescribed training-related activities.

The organisation can claim back the first grant (50 per cent of total levy) by completing both of two tasks. These are registration of a ‘skills development facilitator’ (a formally designated employee charged with the preparation and implementation of the skills plan of the company) and submission of a ‘workplace skills plan’ and an annual training report for the year in accordance with regulated guidelines. As an employer, you should refer to the Department of Labour Website (www.labour.gov.za) for guidelines regarding these activities. The regulations state that SETAs must pay this grant amount if the tasks are completed satisfactorily. Grants are given for actual training programmes that are completed, recorded and submitted.

Further discretionary grants totalling at least 20 per cent of the total levy can be made available for SETAs to distribute for ‘special skills initiatives in its sector’ (such as apprenticeships or other contract-based training, and other relevant programmes).

Next we will take a closer look at the accreditation and quality assurance system in South Africa, the role players, the framework and the hierarchy.

Thank you to Handri Stadler from Thrive Consulting for her input on the accuracy of this articles content.

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