Section 14 of the Main Agreement provides that every employee is entitled to leave enhancement pay calculated on the basis of 8.33 percent of actual earnings excluding allowances. This pay is calculated on a 40-hour work week or upon the actual normal hours worked on the date that the employee actually goes on leave.
Exemptions procedure
SEIFSA is aware that the current economic environment may pose severe constraints on some member companies’ ability to pay the leave enhancement pay. Members are advised, in this regard, that the industry’s current leave enhancement pay exemption procedure continues to apply.
A company that is unable to pay the leave enhancement pay may submit an application to its local Regional Council for exemption from paying the leave enhancement pay.
The exemption procedure is outlined in Appendix A.
It is important to note that an exemption application must be lodged with the bargaining council by no later than 31 October 2022.
This means that companies wishing to apply for exemption must do so without delay, failing which the trade unions may refuse to consider any such late applications.
Exemption application questionnaire
A pro-forma exemption questionnaire is contained in Appendix B.
A company wishing to apply for an exemption must complete the questionnaire in its entirety and return all the necessary documentation to the bargaining council by no later than 31 October 2022.
Management’s attention is drawn to the importance of the Council’s requirement that an application must be accompanied by the following important information in order for the application to be considered:
- A fully detailed motivation explaining the difficulties that the company is experiencing and hence the need for the application. This motivation is not the same as the business plan (see point 2 below).
- Audited Financial Statement for the financial year ending 2021/ 2022. In the case of a closed corporation – a full set of Financial Statements which are to be signed by an Accounting Officer and the latest Management Accounts for the last three months. If the Financial Statements are older than six months, then the Management Accounts for the recent three months are required.
- Formal confirmation that employees were informed of the company’s decision to make an application for exemption.
- Where employees reject the company’s approach, they are to be informed of their right to submit written reasons for objecting to the exemption application and such reasons should be attached as an annexure to the company’s application.
- The signature of at least two employees who accept being the representatives for the workforce and who will be affected by the application. Representatives of the workforce are to sign the form, contained in the exemption application questionnaire, consenting to this.
- The signatures of employees accepting that they have been informed of the implications of what the firm is proposing to the Council.
- Where the employees are trade union members, the company should inform the local trade union office of the intention to apply for an exemption and request, in writing, a meeting with the local official to discuss the impact of the exemption on the company and the members of the union.
- Where employees have elected a trade union representative or representatives (shop stewards) these persons should be requested to sign that they were consulted and that they understand the need for applying for the exemption. Where the local trade union official and/or shop stewards have been consulted and where they reject the application, such refusal must be recorded in the application and countersigned by at least two witnesses.
- Where the local trade union official and/or shop stewards and affected employees support the exemption application, this signed agreement should be included with the application.
- It is recommended that all meetings in this regard between management, employees, shop stewards and union officials be minuted and that the minutes of such meetings be submitted with the exemption application.
- The application itself is to be signed by either a Director of the firm, Member, Owner or a Senior Accountant – neither a Bookkeeper nor the Human Resources Manager’s signatures will be acceptable.
- The savings in cost to company should the application for exemption be granted and the workings in arriving at this cost.
Please Note:
- The exemption application will not be considered or processed by the bargaining council unless all the above requirements are met.
- It is not a condition of the exemption that employees accept the proposed exemption. All that is required is that employees and their representatives are fully informed of the company’s intention to apply for exemption and that this consultation process and their response thereto is formally recorded and submitted with the application.
- If granted, the employer shall then be obliged to become a compulsory contributor to the Bargaining Council’s monthly contribution scheme.
Condonation application
- Where companies have failed to make the exemption application before 31 October 2022, they may apply for condonation.
- In the application, companies will be required to inform the Bargaining Council of the following:
- Degree of lateness (days/months)
- Reason for lateness;
- Prospects of success;
- Potential prejudice to be suffered by the company if the application is not granted; and
- Any other information that may be relevant in assisting their application.
Please note: that the Condonation Application must be signed before a Commissioner of Oaths.
- A copy of the Condonation Application is attached marked Appendix C
Application Forms
Download forms below