CONCEPT NOTE

NEW MECHANISM TO COLLECT AND ANALYSE EMPLOYER DATA FOR EFFECTIVE SKILLS PLANNING

(08 December 2016)

by

Prof Hoosen Rasool & Cuen Sharrock

(contributions from Dr Hersheela Narsee, Weziwe Sikaka and Lauren Derman)

1. What is the purpose of this Concept Note?

The purpose of this Concept Note is to propose a new mandatory grant process and instrument to collect and analyse data from employers. The new instrument is intended to replace the current Annexure 2 of the SETA Grant Regulations.[footnoteRef:1] [1: Department of Higher Education and Training. 2013. SETA grant regulations regarding monies received by SETAs and related matters, No. 990, 03 December 2012. Annexure 2 is the workplace skills plan, annual training report and pivotal plan templates that employers complete and submit to their designated SETAs to apply for mandatory grants. This Concept Note proposes replacing Annexure 2 with an employer survey.]

2. What is the purpose of the Employer Survey for Skills Planning (ESSP)?

The survey is the actual instrument/tool/template that is used to collect data from employers. It is essentially a questionnaire. Currently, the workplace skills plan (WSP) and annual training report (ATR) are instruments used to collect data from employers. These will be replaced by the ESSP because the WSP/ATR does not provide sufficient relevant data to make informed decisions on skills planning. The items in the ESSP are designed to elicit data that can be used specifically for skills planning.

3. What is skills planning?

The Labour Market Intelligence Project (LMIP) defines skills planning as:

how labour market intelligence is utilised to inform decision making processes about where resources are allocated for skills development and how different actors influence this process.[footnoteRef:2] [2: Reddy (2014). Outcome 5.1.1 to develop a credible institutional mechanism for skills planning Presentation given at the ETD Colloquium. 25th November 2014]

The ESSP will focus on gathering information at national, provincial and sectoral levels for skills planning.

4. What changes are proposed?

Currently, employers submit to their designated SETAs a workplace skills plan (WSP), annual training report (ATR) and a pivotal plan to apply for a mandatory grant. The Concept Note proposes that this requirement should be removed and replaced by a survey that is focused on skills planning.

Another change is that the collection of employer data will be centralised. The SETAs will administer the employer survey and export the data in a specified file format to the central database of the Department of Higher Education and Training (DHET). The reasons for this proposed change are elaborated in Section 5 of this note.

More specifically, the following changes are proposed:

A new end-to-end process is devised to collect and analyse data from employers. This process entails new roles and responsibilities for employers, SETAs, and the DHET.

The data collection instrument that will be used in this new process is an employer survey. We refer to it as an Employer Survey for Skills Planning (ESSP).

5. What is the mandate of this Concept Note?

This Concept Note derives its primary mandate from the The White Paper on Post-School Education and Training[footnoteRef:3], which calls for the review of the WSP and ATR., both of which were replaced by Annexure 2 of the SETA Grant Regulations in April 2013. [3: Department of Higher Education and Training. 2013. White paper on post-school education and training. DHET: Pretoria.]

The White Paper states that the revised instrument should be an agreed upon national template, and should include information about all training that is taking place in the workplace; current levels of skills, experience and qualifications of employees; and skills priorities and gaps for the short and medium-term. According to the White Paper, the intention is to produce a user-friendly and accessible template that serves its intended purpose.

The White Paper explains that the submission of the above information will entitle the employer to receive the mandatory grant from their designated SETA. It states further that this grant will only require companies to submit useful and accurate data; there will be no need for employers to report how the mandatory grant was spent.[footnoteRef:4] [4: Ibid.]

Similarly,, the Ministerial Task Team Report on SETA Performance[footnoteRef:5] recommends that the development of the new mandatory grant instrument should be to balance what data employers can reasonably provide, and by when, with the national imperative to collect useful and accurate information on the labour market. [5: DHET. 2013. Report of Ministerial Task Team on SETA Performance. DHET: Pretoria.]

6. Why is it necessary to replace the current employer data collection instruments?

The Ministerial Task Team on SETA Performance, as well as the White Paper, expressed concern about the quality of data received by SETAs from employers and the limited analysis of such data for skills planning.

They draw attention to the following with respect to the current process of collecting and analysing data from employers:

Length of Instrument: Although there have been improvements to the WSP/ATR templates from 2013, the templates are lengthy and unfriendly. It requires employer to submit workforce and training information in more than twenty tables and takes far too long for employers to complete[footnoteRef:6]. [6: Some SETAs have simplified this format by requesting employers to submit data in a non-consolidated format, which typically involves the submission of unidentifiable, individual (unit) records, which appears to be easier for many employers. ]

The Davis Tax Committee Report [footnoteRef:7] on small and medium enterprises recommends that consideration should be given to allowing tax compliant small businesses separate access to a small business SETA mandatory and discretionary spend, without the implementation of comprehensive work skills plans, annual training reports and pivotal training plans. [7: Davis Tax Committee. 2016. Small and medium enterprises: taxation considerations, Second and Final Report, April.]

Lack of relevance: Much of the data requested from employers in lieu of the mandatory grant is not useful for skills planning. For instance, WSPs and ATRs are relevant to the workplace activities of employees. WSPs and ATRs are not monitored for implementation by SETAs. Furthermore, key indicators that are used for skills planning such as hard-to-fill vacancies are absent in Annexure 2.

Low rate of WSP/ATR submission: Historically, the response rate to WSP/ATRs by employers is low. The reduction of mandatory grant apportionments over the years has contributed to this problem. There is very little incentive for employers to apply for grants.

Differential treatment of public and private employers: Annexure 2 comprises different templates for public and private employers. This is unnecessary.

Some are of the view that if WSPs/ATRs are no longer a requirement of mandatory grants, employers will not develop workplace skills plans. Our position is that workplace skills planning is a normal management function of any organisation, and that every employer should continue to conduct workplace skills planning to improve workforce skills.

The employer survey will benefit workplace skills planning because it is concerned with identifying hard-to-fill vacancies (occupational shortages) and skills gaps (top-up skills). This information is needed by employers for assessing skills supply and demand in the workplace.

7. What are the salient features of the proposed employer survey that will replace the WSP/ATR templates (Annexure 2)?

The new instrument that is proposed to collect data from employers through the mandatory grant process is referred to as the Employer Survey for Skills Planning (ESSP). The title ESSP reflects the purpose of the instrument. The actual employer survey instrument is provided in Annexure A of this Concept Note.

The table below describes the salient features of the ESSP:

Objective

The objective of the ESSP is to collect and analyse employer data for skills planning at national, provincial and sectoral levels.

Outcome

The Employer Survey will contribute to the goal of establishing a credible, institutional mechanism for skills planning, Goal 1 of the National Skills Development Strategy (NSDS III).

Frequency

The survey will be conducted annually. Employers are expected to provide data to their relevant SETAs by 30 April each year.

Target Groups

All employers who are registered as taxpayers are expected to complete this survey.This includes the following: all levy-paying employers; all government employers;all non-levy paying employers who are registered to pay tax.

NOTE: Employers who are not registered to pay tax, are EXCLUDED from completing this survey.

Platform

The Employer Survey will be accessible on a web-based platform. The rationale for this is two-fold. Firstly, it allows for validation rules to be coded into the template, which will identify obvious input errors and increase the reliability of the data.

User-Friendly

Completion of the ESSP is made simpler by utilising an interactive online platform. For example, wherever possible, drop down boxes and search functions will be used. Certain functions will be automated. For example, when a Skills Development Levy Number (SDL) number is inserted, other information about the employer will automatically be loaded to the survey.

Definitions will pop up when highlighting key terms such as hard-to-fill vacancies, skills gaps, and so on.

In addition, the platform will be excel-friendly. Employers have the option to complete the survey offline and upload to the system. The same validation rules will be applied to excel uploads to ensure a consistent level of data integrity.

Focus Areas

The employer survey will collect the following information:

Employer profile

Workforce profile (including educational levels and skills gaps)

Hard to fill vacancies

Skills gaps

The employer survey is much shorter and simpler to complete than the current WSP and ATR templates.

Individual employee data

A major change from the current WSP/ATR templates is that the survey requires that employers collect and provide their designated SETA with individual employee data[footnoteRef:8]. The current WSP/ATR templates require employers to provide their respective SETA with aggregated data of their employees. By migrating to a system of collecting and providing individual employee data, the accuracy, reliability and consistency of data received from employers is enhanced. It also compels employers to give individual attention to the skills needs of every employee in the workplace. [8: Individual employee data means that the employer must collect and submit data for each individual employee. The type of data to be collected is provided in the employer survey (Annexure A).]

Continuation from the WSP

The employer survey retains some of the items in the templates in Annexure 2 of the SETA Grant Regulations. However, it removes several items that are not valid for skills planning, and includes new items, to give a sharper focus and to make the instrument user-friendly.

9. Can SETAs include additional items to the employer survey?

There are two views to this question. Each view has merits and limitations. Some are of the view that the employer survey should not be altered in any manner. Others suggest that provision should be made in the employer survey for additional items that individual SETA may want to insert.

Since this concept note is in the discussion stages, all options are on the table. The feedback process will enable us to make an informed decision. Hence, comments from SETAs and their constituencies is necessary.

10. What is the structure of the employer survey for skills planning ?

The ESSP comprises the following sections:

SECTION A: Administrative Details - This section requires standard information about the employer. The information requested is like that in the existing Annexure 2 of the SETA Grant Regulations.

SECTION B: Workforce Profile - This section requires the following:

(i) Biographical data about each employee, which includes information about age, race, gender, citizenship and disability.

(ii) Occupation-related data, which includes data about job title, OFO code, employment status, new entrant, and highest level of education attainment.

To speed up the completion of this section, data from a MS Excel spreadsheet or payroll system can be uploaded to the web-enabled platform of this section.

SECTION C: Hard-To-Fill Vacancies (HTFVs) - This section requires information on HTFVs by OFO 6-digit code; reasons for HTFVs; and number of HTFVs.

SECTION D: Skills Gaps - This section requires information on the top THREE most common skills gaps (top-up skills) identified by employers, by major occupation levels.

SECTION E: Declaration - This section requires employer and employee representatives in the organisation to declare that the data provided is correct.

11. The data collection and analysis process for this survey?

The process of data collection and analysis for this survey is as follows:

DHET

Quality assure SETA upload

Integrate data from SETAs

Weight the data

Process and analyse data

Produce reports and sector briefs

Complete database is made available on electronic platform

EMPLOYER

Complete employer survey

Submit survey to SETA

Address occupational shortages and skills gaps

SETA

Quality assure employer data

Process Mandatory

Grant payment to employer

Data is automatically sent to central database

SETA

Analyse data and use sector briefs for:

Stakeholder consultations

SSP development

Strategic Planning

Other

DHET

Use information for:

Enrolment planning

Identification of occupational shortages and skills gaps

Career Guidance

1

2

5

4

3

1. The employer completes the survey and submits data to the relevant SETA.

2. The SETA verifies data received from employers; uploads to DHET central database; and makes mandatory grant payment to employers, if all requirements are met.

3. The DHET integrates employer survey data of all SETAs; produces reports and Sector Briefs, and disseminate these to SETAs.

4. The SETA uses reports and sector Briefs for stakeholder consultations, research for sector skills planning and strategic planning.

5. The DHET uses reports for identification of occupational shortages and skills gaps; enrolment planning; financial decision-making and career guidance.

ANNEXURE A: EMPLOYER SURVEY FOR SKILLS PLANNING

The employer survey is the actual instrument/tool/template that is used to collect data from employers. The data collected from the survey will be used for skills planning.

All employers who are registered as taxpayers are expected to complete this survey.This includes the following: all levy-paying employers; all government employers;all non-levy paying employers who are registered to pay tax.

Employers who are not registered to pay tax, are EXCLUDED from completing this survey.

The employer survey is presented in a MS Word format to give the reader a clear picture of the items.

Please keep in mind that the actual survey will be in a web-enabled format with spreadsheet upload functionality.

Page | 2

SECTION A is a straight forward form that requires employer information and bank details for the payment of the mandatory grant. The important information required is the number of employees, which is linked to other sections of the instrument.

SECTION A: ADMINISTRATION DETAILS

(A1) EMPLOYER DETAILS

Name of employer

Skills Development Levy (SDL) Number

Physical Address

Street

City

Post Code

Searchable

Province

Postal Address

PO Box/ Street

City

Post Code

Searchable

Province

Total Number of Employees[footnoteRef:9] [9: The period for calculating the Total Number of Employees is different for private employers and public entities. The financial year for private employers is from 01 March to 28 February as per the Companies Act, 2008. The financial year for public entities is from 01 April to 31 March as per the Public Finance Management Act, 1999. Private employers must provide the Total Number of Employees as at the 28 February, whilst public entities must provide the Total Number of Employees as at the 31 March.

]

Standard Industrial Classification (SIC)

SIC Code

Searchable list

SIC Description

Automatically completed based on SIC Code

SETA

Automatically completed based on SIC Code

Annual Payroll for Previous Financial Year

(A2) DETAILS OF PERSON WHO COMPLETED THE SURVEY

To be available in the event of later confirmation and quality assurance.

Title

Surname

First Name

Position (Job Title)

ID / Passport Number

Telephone Number (Work)

Cell Number

Email

(A3) EMPLOYER BANK DETAILS

Name of Bank

Account Number

Name of Account Holder

Branch Name

Branch Code

SECTION B requires individual data to be captured for each employee. Respondents should enter a key word associated with the job. The tool will do a word search of occupation, title and alternative title and presents a list of matches. Once an occupation is selected, either a list of tasks or the descriptors will be shown for the respondent to verify that the occupation selected matches the job in question.

SECTION B: WORKFORCE PROFILE[footnoteRef:10] [10: The period for calculating the Workforce Profile is different for private employers and public entities. The financial year for private employers is from 01 March to 28 February as per the Companies Act, 2008. The financial year for public entities is from 01 April to 31 March as per the Public Finance Management Act, 1999.]

Unique identifier

OFO Occupation

Title

Employers

Job Title

Race

Gender[footnoteRef:11] [11: As per ID book]

Disability

Nationality

Country of origin

Year of Birth

Highest level of Education Attainment

Field of study for post-school qualification

Employment Status

Nature of employment

Province in which employed

Is this employee a new entrant[footnoteRef:12] to the workforce [12: A box will pop up with a definition for a new entrant to the workforce.]

This will include a unique number e.g. employee number

A 6-digit occupation title from the latest OFO version

This is the job title that the employer gives to the employee in the organisation. It is a job title that is unique to the employer organisation.

Refer to drop down to be provided.

Refer to drop down to be provided.

Refer to drop down to be provided.

Refer to drop down to be provided.

Refer to drop down to be provided.

Type in numeric text

Refer to drop down to be provided.

Refer to drop down to be provided.

Refer to drop down to be provided.

Refer to drop down to be provided.

Refer to drop down to be provided.

Refer to drop down to be provided.

SECTION C requires the respondent to provide information on Hard-To-Fill-Vacancies (by 6-digit OFO occupation codes) in the last financial year[footnoteRef:13]. [13: Financial Year refers to: a) The period from 01 March to 28 February for private companies as per the Companies Act, 2008 b) The period from 01 April to 31 March for public entities as per the Public Finance Management Act, 1999. ]

SECTION C: HARD-TO-FILL VACANCIES

A HARD-TO-FILL VACANCY (HTFV) refers to an occupation in your organisation that takes longer than 06 months to find a suitably experienced and qualified candidate.

List occupations in your organisation that were HARD-TO-FILL VACANCIES in the last financial year (indicate the occupations as per OFO 6-digit title).

Identify the main reasons why the listed occupations were HARD-TO-FILL VACANCIES. (select no more than three)

State the number of HARD-TO-FILL VACANCIES

Select the PROVINCE in which the HTFV is being experienced

Drop down box will appear for each line

to identify reasons for HTFVs by province

Drop down box will appear for each line

to identify HTFVs by province

Drop down box will appear for each line

to identify reasons for HTFVs by province

EXAMPLE:

Project Manager

Lack of relevant qualifications Unsuitable job location

Poor remuneration

5

Gauteng

Unsuitable job location

Unsuitable working hours

8

North West Province

Drop Down List

Drop Down List

Drop Down List

Occupational titles from OFO latest version will appear here

Lack of relevant qualifications

Gauteng

Lack of relevant experience

North West

Poor remuneration

Mpumalanga

Unsuitable job location

Limpopo

Unsuitable working hours

KwaZulu-Natal

Equity considerations

Eastern Cape

Do not know

Northern Cape

Other, please specify reason:

Western Cape

Free State

A SKILLS GAP refers to skills that are needed by an employee to carry out job tasks competently. It is also referred to as top-up skills.

SECTION D requires the respondent to provide information on SKILLS GAPS of employees.

SECTION D: SKILLS GAPS

Please list the Top 3 most common SKILLS GAPS by major occupation level.[footnoteRef:14] [14: The period for calculating the Skills Gaps is different for private employers and public entities. The financial year for private employers is from 01 March to 28 February as per the Companies Act, 2008. The financial year for public entities is from 01 April to 31 March as per the Public Finance Management Act, 1999.]

Major Occupations

No

List the Top 3 Most

Common Skills Gaps

Identify up to a maximum of 3 reasons per skills gaps

Managers

1

2

3

Professionals

1

2

3

Technicians and Associate Professionals

1

2

3

Clerical Support Workers

1

2

3

Service and Sales Workers

1

2

3

Skilled Agricultural, Forestry, Fishery, Craft and Related Trades Workers

1

2

3

Plant and Machine Operators and Assemblers

1

2

3

Elementary Occupations

1

2

3

Allocative efficiency

Drop Down List

Lack of relevant qualifications

Lack of relevant experience

Poor remuneration

Unsuitable job location

Unsuitable working hours

Equity considerations

Do not know

Other, please specify reason:

SECTION E: is the final section which represents the DECLARATION on behalf of the employer

SECTION E: DECLARATION

(E1) SUBMIT THE COMPLETED SURVEY WITH THIS SECTION TO RELEVANT SETA BY NO LATER THAN 30 APRIL

DECLARATION

We the undersigned, submit this document in fulfilment of the SETA Grant Regulations Regarding Monies Received by SETAs and Related Matters, N. R. 990, 03 December 2012 (DHET, 2012). We declare that, to the best of our abilities, the information contained in this document is accurate and up-to-date. We recognise that any inaccurate statement in this document may constitute fraud and be subject to the full penalty of the law. We hereby grant permission to our designated SETA to conduct an on-site audit to verify the data submitted to it. We agree to co-operate fully with our designated SETA, by providing the SETA representatives all supporting evidence in relation to the data submitted.

SIGNATORIES

Designated Signatory

First Name and Surname

Telephone and email

Signature

Date

Person who completed the form

CEO/Head of Organisation

Labour Representative