SKILLS DEVELOPMENT

 Applicability

The Skills Development Act (SDA) applies to all employers operating in South Africa, irrespective of their size or industry. If your business has an annual payroll exceeding R500,000, you're required by law to comply with the provisions of the SDA.

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Skills Development Levies (SDL)

Employers subject to the SDA are mandated to contribute a percentage of their annual payroll to the skills development levy. This levy currently stands at 1% of the total amount paid to employees annually. For instance, if your annual payroll is R1,000,000, your SDL contribution would be R10,000. These levies play a crucial role in funding various skills development initiatives aimed at addressing workforce skills gaps and enhancing productivity.

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Discretionary and Mandatory Grants

As an employer, you have the opportunity to claim back a portion of the levies paid in the form of grants from the relevant Sector Education and Training Authority (SETA). These grants come in two forms:

• Discretionary Grants: SETAs allocate these grants based on specific criteria, which may include industry needs, priority skills areas, and the quality of proposed training initiatives.

• Mandatory Grants: Employers who meet certain compliance requirements, such as submitting Workplace Skills Plans (WSPs) and Annual Training Reports (ATRs), are entitled to claim mandatory grants. The current mandatory grant rate is 20% of the total skills development levy paid by the employer.

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WSP/ATR Reporting

Employers are required to submit two key documents to their respective SETAs with the deadline being 30 April of each year:

• Workplace Skills Plans (WSPs): This document outlines your organization's skills development priorities and planned training interventions for the upcoming year. It provides a strategic roadmap for addressing skills gaps within your workforce.

• Annual Training Reports (ATRs): ATRs detail the implementation of the WSPs, reporting on the training conducted, outcomes achieved, and expenditure incurred. These reports are crucial for assessing the effectiveness of your skills development initiatives.

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Reporting Deadlines

It's essential to adhere to the reporting deadlines set by your SETA to avoid penalties or the loss of eligibility for grants. Deadlines for submitting WSPs and ATRs typically fall between April and May each year. Ensure timely submission to maintain compliance with the SDA requirements.

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Learnership Registrations and Agreements

Learnerships are formalized structured learning programs that combine theoretical knowledge with practical workplace experience. As an employer, you can register learnerships with your SETA to provide employees with valuable training opportunities. Learnership agreements outline the terms and conditions of the program, including roles, responsibilities, and the qualifications to be obtained upon successful completion.

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By understanding and complying with the provisions of the Skills Development Act, you can effectively harness its benefits to develop a skilled and competitive workforce, driving sustainable growth and success for your organization.