Implications of a Youth Employment Service employee dropping out of the programme and other Frequently Asked Questions

Reference documents:

Youth Employment Service Initiative, Government Gazette 41866 of 28th August 2018

Labour Relations Act

Basic Conditions of Employment Act

Y.E.S. Initiative Practice Notes

National Minimum Wage Act

B-BBEE Act

The DTIC published the Youth Employment Service Initiative in Gazette 41866 on 28th August 2018. The Initiative enables any organisation, EME, QSE or Generic to enhance its BEE Level by 1 or 2 levels by providing jobs for young black people under the Initiative.

In order for businesses to qualify for Y.E.S., there are certain requirements for each of the business categories which they need to meet.

Black youth aged 18-35 to be employed.

The Company must register with Y.E.S.

A registration fee is calculated according to the entity’s annual turnover.

At least 40% of the points required for each priority element of the B-BBEE scorecard, or 50% average (generic entities) across all priority elements and 40% average QSEs (priority elements are Ownership, Skills Development and Enterprise and Supplier Development).

Generics – 50% average: 34 out of 68 points.

QSEs – 40% any two:

Ownership and Skills: 13,2 out of 33 points;

Ownership and Enterprise, Supplier Development: 15,2 out of 38 points.

The entity must maintain or improve its B-BBEE status level with the introduction of Y.E.S., or apply for exemption from DTI. A 12-month fixed-term or temporary employment contract complying with the minimum industry wage. Be placed at EMEs or QSEs (NPOs) irrespective of size if quality work experience is ensured. Targets to be employed and percentages to be absorbed as per the prescribed formula Absorption after 12 months – Exempted from Absorption in year 1. New Y.E.S. positions must be created in addition to existing employment positions. Entities may not replace existing positions with these new positions. Employment targets achieved after 8 months (one month to replace) – excluding first year of implementation. The Y.E.S. programme is not a learnership, internship on apprenticeship.

Below are a few Frequently Asked Questions (FAQs)

What happens if a ‘Y.E.S.’ Employee drops out of the programme?

Although both an organisation and a ‘Y.E.S.’ Employee enter into a 12-month contract with the best intentions, there will inevitably be drop-outs where ‘Y.E.S.’ Employees will not meet their full contractual obligations.

If a ‘Y.E.S.’ Employee drops out of a ‘Y.E.S.’ Programme before completing eight months of their 12-month fixed-term Contract of Employment, the DTIC provides an organisation one month’s grace to source a replacement candidate.

It is important to note that the replacement candidate, or ‘Y.E.S.’ Employee, must be given a new 12-month fixed-term Contract of Employment from the date of their engagement. The incomplete 12-month fixed-term Contract of Employment of the original ‘Y.E.S.’ Employee has no bearing on the contract of the replacement candidate. In other words, the time worked, or duration left on the contract of the initial ‘Y.E.S.’ Employee is irrelevant to the new Contract of Employment.

A ‘Y.E.S.’ Employee who completes more than eight months of their 12-month fixed-term employment contract before dropping out is deemed to have met their ‘Y.E.S.’ obligation to an organisation. Therefore, upon the completion of eight months, an organisation is under no obligation to replace a ‘Y.E.S.’ Employee and are thus entitled to claim their ‘Y.E.S.’ Recognition Level.

What salary should a youth be paid?

Employers are required to comply with the Minimum Wage Act, 2018, the relevant labour legislation (including the LRA PN 1.10 and BCEA), as well as any sectoral determination the entity is regulated by. Employers should take consideration of internal salary scales when employing Y.E.S. Employees. Agreed For example, where the NMW is R20,76 for each ordinary hour worked, then a youth working 40 hours per month will be entitled to a salary of R3600.

Employers should take consideration of internal salary scales when employing Y.E.S Employees.

Can Youth be employed on a part-time contract?

No. Youth must be employed on a 12-month, fixed term employment contract that complies with the labour legislation, including the LRA and the BCEA. A measured entity may apply the hours of work as per the sectoral determination the entity is regulated by.

What do companies do in the case of maternity leave during the 12-month work experience?

In terms of BCEA the Youth is entitled to 4 months unpaid maternity leave. In the 4 months of maternity leave, the company can use their default maternity policy or allow the Youth unpaid maternity leave. The company does not have to extend the contract beyond the 12 months for the 4 month maternity leave not worked by the Youth however they still need to remain employed until the end of the contract.

If, for operational reasons, a company’s headcount decreases in the year of participation in Y.E.S., how will this affect its target?

The measured entity’s headcount provided at the time that it registers to participate in the Y.E.S. initiative, being the headcount as at the last financial year-end, is used to determine target for B-BBEE recognition. A change in the headcount during the period of participation in the Y.E.S. Initiative will not affect the target for B-BBEE recognition.

Can Youth participate in Y.E.S. multiple times if they have completed one 12 Month Quality Workplace experience?

No. The objective is to provide as many Black Youths as possible with a full 12 Month Quality Workplace Experience.

If a company is non compliant can they participate?

The measured entity would need to at least achieve a Level 8 before Y.E.S. B-BBEE recognition is awarded. Non-Compliant is not a valid B-BBEE status.

Can a QSE participate if they do not have Black ownership?

A QSE has two methods in terms of how Sub-Minimums can be achieved under the Y.E.S Initiative – Normal Method (as per Amended Code Series 000, Statement 000 of Amended Codes of Good Practice) or Average Method (as per the Y.E.S Practice Note).

Where there is no Black Ownership within the QSE, the Average calculation of sub-minimums will be applicable and if the Measured Entity meets the minimum number of points under Skills Development (13,20) or Enterprise & Supplier Development (15,20) in totality, they will be able to participate under the Y.E.S Initiative. Ownership (Net Value) is Mandatory to form a part of the Calculation.

Note that the above does not replace Paragraph 3.3.2.2 of Amended Code Series 000, Statement 000 of Amended Codes of Good Practice and this is still applicable to QSEs. “3.3.2.2 A Qualifying Small Enterprise is required to comply with Ownership as a compulsory element, and either Skills Development or Enterprise and Supplier Development.”

Can Youth employed as part of a company’s participation in Y.E.S. also participate in a learnership, internship or apprenticeship?

No. Initiatives for Y.E.S. are separate from learnerships, internships and apprenticeships.

What is typically measured by “YES4YOUTH” for Y.E.S compliance?

To achieve success “YES4YOUTH”, as an oversight organisation, must ensure that Y.E.S. companies:

Meet compliance requirements by measuring baseline data, registering the Y.E.S. target, are clearly contracted into the programme, receive certificates of baseline and registration compliance for verification, are given assistance and direction to reach targets and in ensuring quality and monitoring and evaluation on a continuous basis.

To achieve success the entity must ensure that Y.E.S. youth: are well managed, have safe pathways to log unfair labour practice and interventions to assist, have basic conditions of labour maintained, have clear contracts, have consistent baseline experiences, learn over the period of the work experience, exit with a credible Y.E.S. reference letter and CV, have been de-risked with a Y.E.S. alumnus badge which represents a currency for the youth to progress into the economy with.

What is a ‘quality’ work experience:

Given the mandate to create one million jobs in three years it is important to recognise that youth placement experiences will be diverse and varied therefore quality is not defined by the nature, location or perceived status of the job due to the breadth and scale of Y.E.S. work experiences.

Quality is measured by and consistency maintained through:

• the personal development trajectory, learning and mindset shift of the youth over the course of the 12-month experience as evidenced through data collection in the Y.E.S. system.
• the completion of the 24 work readiness modules and assessments released over the course of the year-long Y.E.S. contract.
• the data gathered via the baseline survey and the following weekly, two weekly and monthly surveys completed by youth on their Y.E.S. smartphone.
• The data gathered through the supervisor app and survey responses collected over the year.
• The Y.E.S. exit pack of the standardised CV and reference letter built from the collection of a portfolio of evidence from the youth assessments, surveys and supervisor surveys and responses.

As at October 2020, over 40 000 youth nationwide were involved in Y.E.S. work experiences. Improve your BEE level by implementing a Y.E.S programme in your company without delay.

Author Craig Tonkin