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Suspicious workers feel insecure

The government's Training Layoff Scheme announced in August – its response to the recession, aimed at curbing retrenchments and upskilling temporarily redundant workers – has failed to get off the ground fully as originally envisaged. The scheme is now being reviewed.

In an attempt to assist confused employers and suspicious workers, the Department of Labour (DoL) will over the next few weeks launch an informative advertising campaign. However, it should be remembered that the scheme was only launched officially on 21 September.

Nerine Kahn, director of the Commission for Conciliation, Mediation and Arbitration (CCMA) – which is administering the scheme on behalf of the DoL – claims, however, that the scheme has by no means failed. She says it had always been the intention to review the scheme from time to time, but acknowledged that suspicious workers presented one of the major problems that the scheme has encountered.

“It’s a new scheme and we did anticipate some problems. What has happened, is that some workers are afraid if they accept the temporary Training Layoff Scheme and they go back to their company after three months, they might find the company has folded anyhow and they missed out on a retrenchment package as a result. So they rather opted for retrenchment,” says Kahn.

She confirmed that three companies had withdrawn their applications for assistance after their workers became suspicious of the scheme in this regard.

Since the scheme was implemented in September, the CCMA says some 35 companies have to date approached it for assistance in terms of the scheme. Seven requests have been processed by the CCMA, of which five have been recommended for assistance. The rest are in various stages of negotiations with the CCMA.

However, the scheme has benefited thousands of workers so far, despite the seemingly low number of 35 applications. In one of the most recent approved cases, some 1 100 workers from a large automotive manufacturer are to benefit from the scheme.

As for the review of the scheme, Kahn says she cannot say at this stage what it will entail, as all the various parties to the scheme have to be consulted and reach agreement.
She acknowledged that some of the issues to be discussed revolve around accessibility and the details of the scheme being too complicated. She has been asked to make recommendations to the DoL on how to expand and simplify the programme.

The recommendations will also be forwarded to the National Economic Development & Labour Council (Nedlac) for consideration.

In the meantime, it seems that there is also confusion among businesses as to who exactly may benefit and how they should go about applying, while some have complained that the process is too technical and that it is floundering in red tape.

When the scheme was first announced in August by President Jacob Zuma, it was hoped that it would bring substantial relief for workers whose jobs were on the line due to the recession and that it would at the same time make a significant contribution to training and skills development.

The scheme was launched with funding of R2.4 billion drawn from the National Skills Fund (NSF) and the Unemployment Insurance Fund (UIF) and administered in a National Jobs Fund (NJF).

According to Alan Hirsch, deputy head of the Policy Unit in the Presidency, workers who were to be laid off temporarily because of the recession would receive both a sustenance allowance and further training while laid off.

If the scheme proved to work as well as was hoped, consideration would be given to making it a permanent feature in times of future difficult economic crises in South Africa.
Employers or their workers could invoke the scheme with the assistance of the CCMA when a business is in trouble and may have to lay off workers. Workers earning up to R180 000 per year would qualify, with each worker receiving a training allowance equal to 50% of their basic wage or salary up to a maximum of R6 239 per month for up to three months.

The idea was that the training layoffs should be temporary only in order for affected businesses to ride out the economic storm, whereafter the affected company would be able to turn itself around and the temporarily laid-off workers would be re-employed.

Temporarily laid-off workers would attend training courses approved by their relevant Sectoral Education and Training Authority (Seta).

The Setas were asked to set aside additional funds to pay for the training courses. These courses would involve the normal Seta-accredited courses and institutions and would be run jointly by the Seta and the company.

Minister of Economic Development Ebrahim Patel said the type of training was to be decided by the company and the relevant Seta, but that courses should conform to three basic guidelines, namely that they cover skills that can be useful to the affected company; should cover basic training that addresses the challenges of literacy and numeracy; and training should also focus on generic information and communication technology skills.

Kahn says another problem encountered with the scheme revolves around the definition of companies that may apply for training layoff assistance for their workers. The scheme has been designated as being available only to “distressed companies” that have made a loss in the past three consecutive months. The problem is that while many companies in sectors in distress because of the recession may be shedding jobs, they may not necessarily be "distressed" in terms of this definition.

The National Union of Mineworkers is unhappy with the scheme as it is currently applied and says none of the thousands of its members who have been identified as potential beneficiaries have received any benefit. That is, the union says, because most of the job cuts in the mining sector are permanent ones, while the Training Layoff Scheme is for temporarily retrenched workers.

Workers in all sectors who are trained or paid above the levels envisaged in the scheme also cannot benefit from it. In addition to these problems, it would seem that awareness about the scheme is low, with claims that some companies do not even know of its existence. Hence the awareness campaign that is due to be launched by the DoL, even if it is somewhat late in the day with indications being that South Africa is already in the process of emerging from its recession.

Meanwhile, the country’s 23 Setas that have to co-operate with employers in ascertaining and setting up appropriate training schemes for the laid-off workers, have so far set aside R350m for the purpose.

The troubled Setas were recently given respite by Higher Education Minister Blade Nzimande to continue functioning for another year. But various sectors are complaining that their Setas have not done anything.

Minister Patel says the bulk of the money has come from two Setas, namely the Manufacturing, Engineering and Related Services Seta (merSETA) and the Wholesale and Retail Seta (W&RSeta), which together have set aside R300m for the Training Layoff Scheme.

According to Patel, all Setas should allocate funds to the scheme and make available properly accredited short training courses for temporarily laid-off workers, while at the same time reducing the per-worker cost of the training programmes.

At a recent briefing, Education director-general Mary Metcalfe acknowledged that the Training Layoff Scheme was depending on a flawed Seta system, but said “it is the only system we have”.

And Nzimande gave the assurance that his department would monitor the Setas and ensure that "each and every rand and cent is well spent" in terms of the scheme.

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