Lockdown day 6 1 April 2020 - Global Business Solutions

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Lockdown day 6 1 April 2020 - Global Business Solutions
Lockdown day 6
1 April 2020
Lockdown day 6 1 April 2020 - Global Business Solutions
Innovation and work-arounds
Lockdown day 6 1 April 2020 - Global Business Solutions
Innovation and work-arounds
Lockdown day 6 1 April 2020 - Global Business Solutions
Statistics paint a picture

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Lockdown day 6 1 April 2020 - Global Business Solutions
Globally - predictive indicators

              11 600 in SA? V 1353 current

                                                                58 000 in SA? V 1353 current

            116 000 in SA? V 1353 current

https://www.healthcarebusinessinternational.com/exclusive-prediction-pandemic-turning-point-in-european-countries-and-the-u-s-is-expected-to-arrive-this-week-early-april/   5
Lockdown day 6 1 April 2020 - Global Business Solutions
Global statistics

                                          China
                                          Germany

                                               France
                                               /Iran

         https://covid19statistics.org/

https://epidemic-stats.com/coronavirus/
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Lockdown day 6 1 April 2020 - Global Business Solutions
Global statistics

Almost 5%?

             https://covid19statistics.org/

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Lockdown day 6 1 April 2020 - Global Business Solutions
Global statistics

https://covid19statistics.org/

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Lockdown day 6 1 April 2020 - Global Business Solutions
Global statistics

https://covid19statistics.org/

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Lockdown day 6 1 April 2020 - Global Business Solutions
Statistics paint a picture, sometimes

                                        Social distancing
                                        and lock-down!

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South Africa

  46 UP

 www.nicd.ac.za

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South Africa

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A quick look at KZN

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https://www.nextbigfuture.com/2020/02/coronavirus-
fatality-statistics-by-age-gender-and-conditions.html
Macro systemic
                                                     Workforce modelling,                                 factors
                                                          variables                                       Organisation-
                                                                                                          specific factors

                   GDP-related impact                                          Financial metrics
                                                Inter-related   User-centric

    Lock-down duration
                                                                                       Infection escalation rate and threshold
        (scenarios)
                                                                                                       (timing)

                                                        Variables

     Industry and sector                                                                  Infection demographic impact
          realities
                                                                                       (age, gender, pre-existing conditions)

                                                                                 Available remedies (workforce modelling,
      Workforce predictive factors
                                                                                  tax, legal, LR, innovation, and impact on
(number, type, skills sets, demographic) etc)                                   strategic imperatives including BBBEE etc)
New developments

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Funding options (Rem-related)

❑ SARS (from 1 April) – R500 pm tax subsidy to employers of up to R500 pm for the next 4 months for employees earning below R6500
  under ETI;
❑ SARS (from 1 April) – Accelerated payment of ETI in other words payment monthly as opposed to twice a year;
❑ CCMA Temporary Employer/ employee Relief Scheme – for employers facing retrenchments in general (will resume post COVID-19 and
   has been going for some time)
❑ SARS (from 1 April) – businesses with turnover below R50m pa allowed to delay 20% of their employee tax liability over the next 4 months
   and a portion of their provisional corporate income tax payments without penalties or interest over the next 6 months
❑ Employee retirement funds - employers experiencing financial headwinds and who are not in a position to pay their full contributions to
   employee retirement funds can access a temporary payment reprieve on condition they immediately engage with and reach agreement
   with retirement funds and submit agreements to the Financial Sector Conduct Authority (FSCA). This will prevent criminal (Pension Finds
   Act) and civil prosecution. In addition, any rule amendments associated with temporary absence and lay-off need to be submitted as well;
❑ Department of Employment and Labour – COVID-19 TERS UIF scheme – final regulations will be published tomorrow
❑ BCEA – No-work-no-pay (unpaid leave) | Annual leave | short-time | shift patterns and other work arrangements
❑ COIDA – Occupationally-acquired COVID-19
❑ UIF – Short-time | COVID-19 TERS | Quarantine 14 days (no medical certificate) and +14 (medical certificate) |Illness
❑ RE-SET the level (freeze, OD, terms of employment, benchmarking, re-engineering)
Balancing the books – the remuneration deficit

Usual leviable payroll                                             Funding options
❑   People percentage (payroll/                                    ❑   What employer can afford
    revenue)                                                       ❑   Pay those that can work
❑   Total cost per employee                                            remotely if ROI exists
                                                                   ❑   Access SARS, UIF, PAYE, etc
                                                                   ❑   Determine shortfall and
                                                                       sustainability
Right to strike?
     Right to strike?

Yes, the right exists unless they have been
designated under s71(8) of the LRA by the ESC of
the CCMA.
                                          But they would have to
                                          stay in their homes!

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XYZ

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Transport

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General

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Early on 31 March 2020,
taxi strike averted?

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Putting the circle back into the square

                                     The secret of
                                    your future is
                                    hidden in your
                                    daily routine!
QUICK GUIDE TO COVID-19
TEMPORARY RELIEF SCHEME                                            01.04.2020
         VIA UIF
           COVID-19 TOOLKIT SERIES
 - Specifically applicable during the national lockdown period -
                                                                                33
Covid-19 Temporary Employer Relief Scheme

    Directive was created to make provision for the:                                    IMPORTANT TO NOTE:
    • Payment of benefits to the Contributors who have lost                             ❑ Covid-19 TERS replaces the National Disaster Benefits
      income due to Covid-19 pandemic;                                                    previously published by UIF
    • Minimise economic impact of loss of employment                                    ❑ Simplifies the process as it’s Employer-led & allows for a mass
      because of the Covid-19 pandemic;                                                   application online

    • Avoid contact and contain the spread of Covid-19                                  ❑ Normal TERS programme offered by the CCMA continues, but
      during the process of application for benefit;                                      is not applicable to the period of #lockdown

    • Establish the Temporary Relief Scheme and set out the
                                                                                        ❑ Confusion over past few days as there have been several
                                                                                          changes to the instructions and documents requested. Process
      application process for benefits of the Covid-19
                                                                                          is under negotiation with NEDLAC and anticipated to be
      pandemic and to alleviate economic impact thereof
                                                                                          finalised imminently.
    • Online applications for benefits in order to avoid                                ❑ Don’t wait to apply – put your application in now, using the
      contact during the national disaster period.                                        latest documents (our toolkit) and we will keep you posted on
                                                                                          any changes

If you require assistance in managing/administering the Covid-19 Temporary Relief Scheme application process via UIF, GBS has a dedicated team ready to help you navigate this process,
                                  including a detailed Application Toolkit available. For more information please contact: natalies@globalbusiness.co.za
COVID-19 LOCKDOWN: ACCESSING COVID-19 TEMPORARY RELIEF SCHEME

Qualifying Criteria
 In order to be eligible to access the Covid-19 Temporary Relief Scheme, the following criteria apply:

 Closure of Operations                                                             Employer Conditions
                                                                                 ❑   Company must be registered with UIF;
 The employer’s operations must be closed (or                                    ❑   Closure must be directly linked to Covid-19;
 partially closed), for a period of up to maximum of                             ❑   Agree to MOA terms with UIF
 three (3) months and suffer financial distress as a                             ❑   Comply with application procedure for financial
 direct result of the Covid-19 pandemic.                                             relief scheme

             ▪   Benefits are de-linked from UIF credits system, therefore the provision that four days of work equates to one day’s credit
                 (for up to 365 days) does not apply
             ▪   Does not apply to employees who will be fully paid by Employer during period but “part-payment” or “reduced hours” qualify
             ▪   Benefits will only pay for the cost of salary (calculated using UI Benefits Sliding Scale) for the employees during the temporary
                 closure of the business operations.
             ▪   Maximum benefit will be calculated on a salary cap of R17 712 per month (est. R6700 benefit per month), but lowest wage earners
                 protected with at least minimum payment of R3500 per month.
             ▪   For those with variable earnings, including commission-only (average over past 6 months used to calculate “remuneration” figure)
             ▪   Does not apply to any employees who are employed after the #lockdown period.
COVID-19 LOCKDOWN: ACCESSING COVID-19 TEMPORARY RELIEF SCHEME

  Key Terms & Conditions
  The details of the MOA are still under discussion at NEDLAC, but primary terms & conditions are:

  ❑ Employer would NOT be eligible to apply if the Bargaining Council in their sector has concluded an agreement with
    UIF in order management benefits payment to employees in the sector
  ❑ Management of the “unusual” process: i.e. payment of benefits en masse to employers for onward distribution to
    employees
  ❑ Ensure correct use of monies paid out under Covid-19 TERS
         ▪ MUST be paid to employees for purposes as per Act, i.e. to assist with financial hardship related to income loss
  ❑ Auditable accounting procedures                                                                                                         Different versions have been
                                                                                                                                           shared over past week. It is our
         ▪ Clearly auditable via separate management accounts/ledger
                                                                                                                                            understanding that when the
         ▪ Special / dedicated bank account – currently under question as admin onerous
                                                                                                                                             final terms are concluded at
  ❑ Agreement to pay back any under-utilised funds paid to Employer                                                                          NEDLAC that the final single
                                                                                                                                            terms will be applicable to all
  ❑ Outline processes, timelines and submission requirements (documents)                                                                    employers and supersede any
  ❑ Enable the agreement to apply for up to a maximum of three (3) months                                                                       outdated MOA signed.

       - NOT APPLICABLE TO MICRO EMPLOYERS AS UIF WILL PAY EMPLOYEES DIRECTLY -

If you require assistance in managing/administering the Covid-19 Temporary Relief Scheme application process via UIF, GBS has a dedicated team ready to help you navigate this process,
                                  including a detailed Application Toolkit available. For more information please contact: natalies@globalbusiness.co.za
COVID-19 LOCKDOWN: ACCESSING COVID-19 TEMPORARY RELIEF SCHEME

 Application Process                                                                          1
Employers shall report their closure to Covid19ters@labour.gov.za and will receive an automatic reply outlining
the application process (as illustrated below)

                                                                        3
                                                                                                                         Employer
                                                                                                                         with Less    4a           UIF will pay
                                                                                                                                               employees directly
Docs Required                                                               UIF will download completed
                                                                            template to process claim:
                                                                                                                          than 10
                                                                                                                        employees
                                                                                                                                              into nominated bank
                                                                                                                                                    accounts
                        Permission (from CEO) granted to individual         •    Calculation of benefits amounts
Letter of Authority     to lodge claims on behalf of Company                     using Income Replacement Rate
                                                                                 sliding scale                          Employer with more than 10 employees
                        MOA with UIF sets out the terms relating to         •    Benefits calculated on maximum
  MOA between           participation in Covid-19 TERS. Employer will            Capped Salary (R17 712)
                                                                            •
  Employer & UIF        be required to confirm agreement with terms
                        & conditions electronically.
                                                                                 Sector Minimum Wage or National
                                                                                 Minimum Wage
                                                                                 (no less when IRR calculated)
                                                                                                                   4b     UIF will provide amount to be paid per
                                                                                                                        employee & request invoice from Employer
                                                                                                                                 to transfer total amount.
                       Complete template with following info:
Prescribed template     •   Employer details
 containing critical
Employer Employee
                        •
                        •
                            Period of closure
                            Employee details
                                                                                                                   5          Employer sends invoice to UIF.

    information         •
                        •
                            Remuneration received by Employees
                            Minimum Wage (sector specific)
                                                                        2       Email Application & Documents
                                                                                                                   6    UIF deposits total amount into nominated
                                                                                 Covid19claims@labour.gov.za                    Employer bank account.
                        • Proof of remuneration to employees in
     Supporting           form of 3 months Payroll/Bank Statements
    Information         • Confirmation of Employer bank account in
                          form of latest certified bank statement
                                                                                                                   7     Employer pays employees into their bank
                                                                                                                        accounts and sends proof of payment to UIF
Application Toolkit: Submission Checklist
There are differences for employees with less than 10 employees and those with more

If you require assistance in managing/administering the Covid-19 Temporary Relief Scheme application process via UIF, GBS has a dedicated team ready to help you navigate this process,
                                  including a detailed Application Toolkit available. For more information please contact: natalies@globalbusiness.co.za
Application Toolkit: Letter of Authority
Applies to both Large and Micro Employers

   ❑ Company Letterhead
   ❑ Full details of the nominated/authorized representative
   ❑ Contact details of nominated/authorized representative
   ❑ Signed by BOTH CEO and CFO
     (or equivalent in your business)
   ❑ Suggest that you save it in PDF, especially if it contains
     electronic signatures

If you require assistance in managing/administering the Covid-19 Temporary Relief Scheme application process via UIF, GBS has a dedicated team ready to help you navigate this process,
                                  including a detailed Application Toolkit available. For more information please contact: natalies@globalbusiness.co.za
Application Toolkit: Data Guidance Note
Format differs considerably between Large & Micro Employers
  ❑ File must be named specifically

  ❑ Format in which data is captured and saved is critical
          ▪   Header and Footer rows in exact format must be included
          ▪   Saved as .csv for Large Employers with VERY specific pipe [|] delimiter chosen
          ▪   Different date formatting requirements
          ▪   Format for Rand figures to exclude commas and R-sign, i.e. 3500.00
  ❑ Monthly Remuneration figure must be given
          ▪ For variable income earners, use average of past 6 months
          ▪ UIF will pro rata based on length of claim
  ❑ Income during leave period must be given
          ▪ This is whatever remuneration the individual will receive during lockdown, whether
            part-payment, payment for reduced hours, value of paid leave, etc.
  ❑ MUST include Sector Minimum Wage figure otherwise claim will be
    rejected. Guidance is provided on how to calculate.
  ❑ Banking information which is given (Employer vs. Employees)

If you require assistance in managing/administering the Covid-19 Temporary Relief Scheme application process via UIF, GBS has a dedicated team ready to help you navigate this process,
                                  including a detailed Application Toolkit available. For more information please contact: natalies@globalbusiness.co.za
Application Questions
Key questions as we apply whilst awaiting finalised MOA/terms:

•    Special Bank Account
      In this regard, there already seems to be an indication from UIF (in their most recent Auto Response) that the special bank account is only applicable to
      Bargaining Councils. Our recommendation at this stage is that, if you don’t have a special account available, to use your normal payroll bank account for
      this application now. The primary requirement will be to ensure that you can ‘account’ for the C19 TERS funds and disbursement thereof to employees
      easily for audit purposes. This will remain even if the special banking account requirement is foregone.

•    Claiming if your company is only experiencing part-closure
      This would apply for organisations where some employees, due to the nature of their work, may be able to continue to work (and be paid) remotely.
      Others, such as those in production, may not be able to work away from their usual workplace, and would therefore be liable for “no work, no pay”
      principle treatment. Conversely, for those declared an essential service, some employees may be working during this period and receiving their usual
      remuneration, whilst others (perhaps in non-essential areas, such as marketing/finance) will be subject to reduced or “no work, no pay” principle
      treatment. You can, as we understand, claim only for those employees who are negatively impacted either by loss of income (total or partial) or subject
      to reduced work hours.

•    Claiming for employees who are receiving part-payment
      We understand that the income relief is intended to assist employees who are prejudiced as a result of the Covid-19 and the lockdown period. There is
      no clarity on whether there is a threshold applicable, i.e. if a company is paying more than 50% of normal salary, to claim. Rather, we recommend that
      where employees are not receiving their usual full remuneration, you can claim, understanding that claim benefits will be limited to the sliding scale
      which for employees earning more than R17 712 will be capped at approximate R6500 per month.

If you require assistance in managing/administering the Covid-19 Temporary Relief Scheme application process via UIF, GBS has a dedicated team ready to help you navigate this process,
                                  including a detailed Application Toolkit available. For more information please contact: natalies@globalbusiness.co.za
East London               Durban               Port Elizabeth          Johannesburg              Cape Town

   T 043 721 1030           041 364 0472            041 364 0472            011 483 3722            021 418 1617

   F 043 721 1027           086 414 4926            086 414 4925            011 483 1650            021 418 1619

     trainingel            dbnmarketing             pemarketing             jhbmarketing               infoct
@globalbusiness.co.za   @globalbusiness.co.za   @globalbusiness.co.za   @globalbusiness.co.za   @globalbusiness.co.za

                               www.globalbusiness.co.za
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Thank you for your

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