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									                                                                      “Working together for a skilled tomorrow”




                                    Learning Materials

             Unit Standard Title:                           Examine the application of the Basic
                                                            Conditions of Employment Act and its
                                                            effect on earnings in own contract.


             Unit Standard No:                              10717


             Unit Standard Credits:                         2


             NQF Level:                                     2



                                      Facilitator Guide

                             This outcomes-based learning material was
                                             developed by
                                   Andy Reinecke and associates
                                            and reviewed by
                                   INHLE Business Solutions and
                                            Skills Initiative
                             with funding from INSETA in October 2003.


                                The material is generic in nature.
                 Its purpose is to serve as a guide for the further development
                     and customization of company-specific, learner-specific
                          and situation-specific learning interventions.


                                                     Disclaimer:
  Whilst every effort has been made to ensure that the learning material is accurate, INSETA takes no responsibility
  for any loss or damage suffered by any person as a result of the reliance upon the information contained herein.



Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                          Page 2




Index                                                                                              Page No.


Pre-planning – learner material .................................................................. 3

Planning the learning ................................................................................. 4

The learning day ........................................................................................ 5

Preparing learners for assessment........................................................... 12

Assessment rubric.................................................................................... 13




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                          Page 3




Important notes to the Facilitator

 This Facilitator Guide should be read in conjunction with the User
  Guide provided by Inseta.
 The material provided by Inseta is generic. The Facilitator should
  modify it where appropriate.



Pre-planning – learner material
Facilitation of training should take place around a facilitated learning experience (i.e. a training
day). The recommendation is that learner’s are given material at least one week in advance
along with strict instructions to prepare for the training. The learning experience will be greatly
enhanced in the learners have completed this preparation. The development plan allows 2
hours for pre-reading and it is strongly recommended that these be fully utilised.

At least a week prior to the training you should provide the learner with a copy of the Learner
Guide. The distributed version of the Learner Guide includes a number of assessment
instruments. The Facilitator must decide whether to distribute these with the Learner or extract
them for later distribution as an Assessment Pack.

We recommend that at the same time you give the learners:
  1. The Basic Conditions of Employment Act
  2. A specimen payslip (if they do not have their own)
  3. A specimen employment contract or letter of appointment (if they do not have their own)

At a minimum you should have a copy of the Act for yourself. These items were made available
with the original distribution of this material.

If you are missing reference material you can consult the following sources:
     1. The Inseta website (www.inseta.org) which contains this material.
     2. The Department of Labour website (www.labour.gov.za) which contains most labour
        legislation.
     3. The SARS website (www.sars.gov.za) which contains tax tables for employees and
        other information about PAYE or UIF.




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                          Page 4


Planning the learning
We have not provided a detailed checklist of your needs for the training day – this will follow
your normal training regimen. We do not wish to prescribe how you set up the training room or
what media you use to convey concepts.

The training day is planned to run for a full 8 hours. If you allow 30 minutes for lunch and two
15 minute tea breaks, then the programme could look as follows:

Time          Topic                                                                                   Duration
08h00 to      Introduction
                                                                                                       0h15m
08h15
08h15 to      Purpose of the Act
                                                                                                       0h45m
09h00
09h00 to      The Act and its impact on financial elements in your contract
                                                                                                       1h00m
10h00
10h00 to      Tea
10h15
10h15 to      The Act and its impact on financial elements in your contract –
                                                                                                       1h00m
11h15         continued
11h15 to      Your salary advice
                                                                                                       1h00m
12h15
12h15 to      Lunch
12h45
12h45 to      Your salary advice – continued
                                                                                                       0h30m
13h15
13h15 to      Financial responsibilities: Company to employee
                                                                                                       1h30m
14h45
14h45 to      Tea
15h00
15h00 to      Responsibilities of employee to company
                                                                                                       1h30m
16h30
16h30 to      Assessment instruments – preparing your portfolio of evidence
                                                                                                       0h30m
17h00
              Total learning time                                                                      8h00m

This is a very full and potential exhausting programme. We have tried to break it up by
including a reasonable amount of group work and discussion. However, time is tight and it will
be important to be very firm in keeping groups to their deadlines for completion of discussions.




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                          Page 5


The learning day
The learning day should follow the learner material fairly closely. What follows here are some
guidelines on how the various exercises could or should be answered. These are set out in the
order in which they appear in the learner material. Note that these guidelines are not
necessarily complete and it is legitimate to add your own ideas.

Task: Why do you think there is a law about the basic conditions of employment?
Why is it important for each of the stakeholders below (employees, employers, clients, the
community, government)?
                                                          Time: Maximum 20 minutes discussion
                                                                       20 minutes for feedback
Employees                                         Employers

   Security                                                 Clears up expectations
   Protection against unscrupulous                          Provides framework within which to deal
    employers                                                 with employees
   Satisfactory leave arrangements                          Provides guidance on appropriate forms
   Reasonable working hours                                  and procedures




The community                                             Government

   Meets their social and moral codes                       Meets social and moral obligations to
                                                              constituents
                                                             Creates sound environment for dealing
                                                              with employer/employee issues
                                                             Sensible arrangements support economic
                                                              development




Clients

   Confidence that goods that they buy are not the product of exploitative labour practices




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                          Page 6


Task: Go through the pre-work and identify answers to some of the questions
The questions relevant to this discussion are numbers 1 to 7. Discuss your answers with the
group.

                                                                Time: Maximum 20 minutes discussion
                                                                               20 minutes for feedback
No.    Question                                   Group answer
                                                  “Overtime” is work in excess of ordinary hours of
       Draw a mind map or similar                 work
       diagram to highlight when you are
       paid overtime. Indicate what the           Overtime has to be by agreement (employee can’t
       overtime rate is.                          be forced to work overtime)
 1
       Make notes in the block on the             Payment must be at least 1½ times ordinary rate.
       right and draw you mind map in
       the space below.                           On Sundays this goes to double.

Do you understand what a mind map is? Use this opportunity to clarify your understanding.

One of the assessment criteria requires use of a mind map, which is why an example is
included here. A simple map that shows and links various points is what is required.


                                                  Annual

                                                  Must be the equivalent of 3 weeks or more – check
                                                  contract

                                                  Sick leave

                                                  Must be at least 30 days per three year cycle –
                                                  check contract
       What leave does your company
 2
       offer?                                     Maternity

                                                  Law provides at least 4 months, starting any time
                                                  from four weeks prior to due date

                                                  Other

                                                  Consider paternity leave, family responsibility leave,
                                                  unpaid leave, etc.

       Does your company offer you a                  Yes
       medical aid (or medical scheme)?               No
 3     If yes, how much do you pay and
       how much does the company                  Check contract and payslip…
       pay?




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                          Page 7

                                                      Yes
       Does your company have any                     No
 4     scheme that pays out when you
       die?                                       Check contract and payslip…

                                                      Yes
       Does your company have any                     No
 5     scheme that pays out when you
       become disabled?                           Check contract and payslip…

       Does your company have any                     Yes
       scheme that pays out when you                  No
 6     retire? If yes, how much do you
       pay and how much does the                  Check contract and payslip…
       company pay?
                                                      Yes
       Does your company pay                          No
 7     bonuses? If yes, what conditions
       apply?                                     Check contract…


Task: Go through the summary of the Act and identify some key points
Answer the questions below in groups and then feedback to the general forum.

                                                                Time: Maximum 20 minutes discussion
                                                                               20 minutes for feedback
No.    Question                                   Group answer
                                                  Regulations are contained in section 32 of the Act
                                                   Pay in SA currency (Rand)
                                                   Paid daily, weekly, fortnightly or monthly
                                                   Paid in cash, by cheque or by direct deposit
                                                   Cheques or cash must be given at work, during
       What are the key regulations
 1     governing payment of                          normal hours and in a sealed envelope
       remuneration?                               Must pay not more than 7 days after completion
                                                     of work or termination of employment
                                                   (Reference to exclusion of Pension Fund
                                                     contributions not needed for part of checklist, but
                                                     not necessarily wrong)




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                             Page 8

                                                  Annual leave

                                                      Must be at least 21 consecutive days (or whatever is in the
                                                       contract)
                                                      Must be paid leave.

                                                  Maternity leave

                                                      Must be at least four months. Can start any time from 4
       What leave does the Act require                 weeks before due date.
 2                                                    Payment determined by Minister, subject to UIF.
       the company to give you?
                                                  Special leave

                                                      Could apply to sick leave or family responsibility leave. Sick
                                                       leave is at least 6 weeks in a 3-year cycle.
                                                      Family responsibility leave is 3 days when a child is born,
                                                       when a child is sick or in the event of death of a close
                                                       relative.
                                                      All these cases must be paid leave.

                                                  If you resign:
                                                        Normally you would have to give four weeks
                                                          notice (if you’ve worked for a year or longer)
                                                          in terms of the legislation. Some contracts
                                                          may differ from this, especially in the first
                                                          year.

                                                  From the employer’s side:
                                                   The employer has to pay you to the end of the
                                                     notice period (unless you agree with the
       What rules apply regarding the
 3                                                   employer any arrangement not to work out the
       termination of your employment?
                                                     notice, for example in order to start a new job
                                                     sooner).
                                                   The employer also has to pay you in lieu of any
                                                     accumulated leave.
                                                   There may be severance pay due (e.g. if
                                                     termination of employment is due to
                                                     retrenchment).
                                                   The employer has to give you, on request, a
                                                     certificate of service.


Quick exercise: Make up an example of how allowing unlimited deductions might be a
problem.

This exercise is intended to stimulate some creative thinking. The groups should come up with
ideas of what might happen to employees who have to pay more than 25% of their
remuneration to the employer to pay off loans.

If they are stuck for ideas then prompt them – for example consider a low-paid employee that
takes a salary advance and then needs a further advance etc. until they are highly over-
borrowed. At that stage they would be very exposed to the employer and open for
manipulation.


Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                          Page 9


Task: Go through the pre-work and identify answers to some of the questions
The questions relevant to this discussion are numbers 8 and 9. Discuss your answers with the
group.

                                                             Time: Maximum 15 minutes discussion
                                                                         15 minutes for feedback
No.    Question                                   Group answer
       Check your payslip. How much
       was deducted for income tax? In            R350,55 (in the specimen salary slip)
 8
       this example use the specimen
       salary slip provided.
                                                  Should include:
       Put all your deductions in a                Pension fund
       checklist. You should list the              Medical aid
       deductions that you have seen
                                                   Tax
       coming off your payslip. Tick
 9                                                 UIF
       those that you expect to see
                                                   Insurances
       coming off your next payslip. Are
       there any other deductions that             Union fees
       might come off?                             Garnishee order, if applicable
                                                   Etc (if more to include…)

Quick exercise: Sort the following into compulsory and voluntary:

Garnishee order – compulsory

Insurance – voluntary

Medical Aid – voluntary (although membership could be a condition of service)

Membership of staff club – voluntary

Payments to staff charity – voluntary

Pension Fund – voluntary (although membership could be a condition of service)

Staff loans – voluntary (you don’t have to borrow)

Tax – compulsory

UIF – compulsory

Union Fees – voluntary (you don’t have to join the union)


Quick exercise: Think of an example where you have traded your labour for remuneration.

Normally this would be by doing one’s own job. Learners can use any relevant example.




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                         Page 10

Task: Consider the value of different jobs.
As a group discuss the value of an employee’s labour in the work-place. Come up with three
examples of activities that an individual does that adds value. Suggest which of these adds the
most/least value per hour and give reasons for your answer.

                                                                   Time: Maximum 20 minutes discussion
                                                                               20 minutes for feedback
Some examples of ranking that may help:
 Wine taster more than grape picker (rarer skill)
 Accountant signing off audit more than bookmaker drawing up accounts (higher education
  and training level)
 International footballer entertaining crowd more than mediocre footballer maintaining fitness
  (higher performance level)
 Doctor healing sick more than carpenter repairing door frame (possibly all three reasons)


Quick exercise: Describe briefly what other costs your employer incurs as a result of employing
you.
Some examples:
 Pay employer’s share of:
      o Insurances
      o pension and/or provident fund
      o medical scheme
      o disability or accident cover
      o UIF
 Cost of training
 Cost of premises (workspace in office or factory)
 Cost of running premises (electricity, water, rates, etc.)
 Cost of work-station (desk, PC, working tools, etc.)
 Cost of management (supervisor, HR, support services)
 Cost of communication (telephones, faxes, eMail, etc.)
 Cost of work-related travel


Quick exercise: What is your cost to the company in this example?

Pension Fund = 10% of R3.000, i.e. R300 per month.
Total is R3.000 + R400 + R300 + R300 = R4.000 per month


Task: Consider the unproductive activities.
As a group discuss how unproductive activities harm your company. Take a sample of the
above activities and suggest how each of them costs the company money or prevents the
company from making a profit. See if you can come up with more examples of unproductive
activities.

                                                                   Time: Maximum 20 minutes discussion
                                                                               20 minutes for feedback




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                         Page 11

The costs should be described in terms of:
 Loss of productive time
 Business interruption
 Lost production
 Missed business opportunities
 Cost of repairs
 Wasted expenditure
 Loss of development opportunities,
 Etc.


Quick exercise: Practice this conversion by showing a rate of R1 per hour as a daily, weekly,
monthly and annual rate. Assume you work 8 hours per day and 5 days per week.

The figures are:
    R8 per day
    R40 per week
    R173,20 per month
    R2.078,40 per annum




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                         Page 12


Preparing learners for assessment
You should prepare learners for their assessments. If you have not done so give them the pack
of assessment instruments contained in the Learner Guide. Brief them on the assessor’s
contact details. You should also ensure that they have your contact details.

Evidence is collected in a portfolio that must then be submitted for final summative assessment.
Note that the last exercise during the facilitated learning provides space for learners to plan the
layout of their portfolios. The easiest may be a simple file with the assessment pack in it, duly
completed and signed off. The assessment instrument checklist, duly ticked off, should be
included at the front of the portfolio along with copies of information used (copy of payslip, copy
of employment contract or letter of appointment).

Note that the assessment instruments developed for this unit standard incorporate generic
headings and footers (learner name, dates, signatures, etc.). When using this material the
facilitator and/or assessor should fit the questions to a template that meets his/her requirements
for controlling the assessment. The assessment should take place in line with the assessment
and moderation policies of the relevant Training Service Provider.




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                         Page 13


Assessment rubric

The pages that follow correspond to each of the assessment instruments developed in the
previous section. The rubric indicates a “model solution” indicating what constitutes
competence and, where applicable, what does not constitute competence. The number of the
knowledge tests, the exercises and the group projects correspond to those given in the
assessment instruments. Header and footer information has been omitted.

The number of the relevant assessment criterion is given in each case in italics, e.g. AC2.1
relates to the first assessment criterion under specific outcome 2.




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                         Page 14


Knowledge test 1
No. Question                                      Answer                                          Assessment
    Name the two general terms used
                                                  Salary (monthly paid)
    to describe a person’s
                                                  Wages (weekly paid)
    remuneration. Hint: The one is
 1
    usually used to describe monthly
                                                  1 mark each
    pay and the other to describe
    weekly pay.
                                                     No tax
                                                                                                  AC1.1
       If you earn less than R30.000 per
 2     year, what income tax do you
                                                     SITE only
                                                                                 1 mark
       pay?                                          PAYE only                                   To be
                                                                                                  competent
                                                     SITE and PAYE                               candidate
       If you earn more than R30.000 per             No tax                                      should get 4 out

 3
       year but less than R60.000 per                SITE only
                                                                                 1 mark
                                                                                                  of the 5 marks
                                                                                                  available.
       year, what income tax do you                  PAYE only
       pay?                                          SITE and PAYE
                                                     No tax
       If you earn more than R60.000 per
 4     year, what income tax do you
                                                     SITE only
                                                                                 1 mark
       pay?                                          PAYE only
                                                     SITE and PAYE
                                                  a) Gross income                                 AC1.4
       A person takes a job at R5.000
                                                  R5.000
       per month. They pay UIF of 1%,                                                             To be
       staff club fees of R10 per month                                                           competent the
                                                  b) Net income
 5     and the tax deducted is R450,09.                                                           candidate
                                                  UIF = 1% of R5.000, i.e. R50.                   should get the
       What is his/her:
                                                  Net = R5.000 – R50 – R10 –                      gross right and
       a) gross income per month
                                                  R450,09 = R4.489,91                             be on the right
       b) net income per month                                                                    path for the net.
                                                  “Overtime” is work in excess of
                                                  ordinary hours of work
                                                                                                  AC1.5
                                                  Overtime has to be by agreement
                                                                                                  To be
       Outline the conditions of payment          (employee can’t be forced to work               competent the
       for overtime pay as set out in the         overtime)                                       candidate must
 6
       Basic Conditions of Employment                                                             mention the
       Act.                                       Payment must be at least 1½ times               higher rate and
                                                                                                  at least one
                                                  ordinary rate.                                  other point
                                                                                                  about overtime.
                                                  On Sundays this goes to double.




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                         Page 15


Knowledge test 2
No. Question                                      Answer                                          Assessment
                                                  It is an order of the court…

                                                  …for the employer to deduct money               AC2.5
                                                  from an employee’s salary/wages…                To be
 1     What is a Garnishee Order?                                                                 competent the
                                                  …to pay to a third party (e.g. creditor,        candidate must
                                                  ex-spouse receiving maintenance,                provide a
                                                  etc.)                                           reasonable
                                                                                                  explanation,
                                                                                                  taking the two
                                                                                                  answers
                                                      Court official serves notice               together. If the
                                                                                                  candidate
                                                      Employer has to comply…                    misses the
                                                      …by deducting the specified
                                                                                                  court
                                                                                                  involvement or
       Explain briefly the process that is             amounts from the employee’s                the deduction
 2                                                     wages…                                     from wages
       followed with a Garnishee Order?
                                                      …and paying it to the specified
                                                                                                  s/he is not
                                                                                                  competent.
                                                       party.




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                         Page 16


Knowledge test 3
No. Question                                      Answer                                          Assessment
                                                                                                  AC3.3
                                                                                                  To be
                                                                                                  competent the
                                                                                                  candidate
                                                                                                  should identify
                                                                                                  more than 1
                                                                                                  item from the
                                                                                                  contract (unless
                                                                                                  salary is the
                                                  Per range statement:                            only term). If
       In terms of your employment                 Basic salary                                  three or more
       contract (or the specimen
                                                   Annual salary review                          terms are
       contract) what financial
 1                                                 Leave pay                                     present then
       commitments does your employer                                                             the candidate
                                                   A monthly payment date                        should identify
       make to you?
                                                   Allowances                                    at least three.
                                                   Benefits
                                                                                                  The list given
                                                                                                  here is that in
                                                                                                  the unit
                                                                                                  standard range
                                                                                                  statement.
                                                                                                  Other financial
                                                                                                  obligations are
                                                                                                  permissible, if
                                                                                                  they are
                                                                                                  relevant.




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                             Page 17


Knowledge test 4
No. Question                                Answer                                                    Assessment
                                             Regular attendance (as                                  AC4.1
       List five key responsibilities that     contracted)
       an employee has towards his/her       Punctuality                                             Giving four
       employer. Note: These                 Productivity (within reason)                            relevant
 1                                                                                                    suggestions
       responsibilities should apply to all  Reliability (doing what you say                         would be
       employees and not just to one           you’d do)                                              competent
       particular job.                       Proper use of company resources                         (those listed or
                                             Due care of company resources                           similar).

                                             Pay employer’s share of:
                                                    o Insurances
                                                    o pension and/or provident
                                                        fund
                                                    o medical scheme
                                                    o disability or accident cover
                                                    o UIF                                             AC4.4
       When you are employed your            Cost of training
       employer pays you a wage or           Cost of premises (workspace in                          Giving four
       salary. Describe briefly what other     office or factory)                                     relevant
 2                                                                                                    suggestions
       costs your employer incurs as a       Cost of running premises                                would be
       result of employing you. List at        (electricity, water, rates, etc.)                      competent
       least five areas of cost.             Cost of work-station (desk, PC,                         (those listed or
                                               working tools, etc.)                                   similar).
                                             Cost of management (supervisor,
                                               HR, support services)
                                             Cost of communication
                                               (telephones, faxes, eMail, etc.)
                                             Cost of work-related travel

       List five activities that are not
       productive and that reduce the                                                                 AC4.5
       value that you add to your                   Sample answers:
                                                                                                      The examples
       employer. Choose three of these               Toilet time                                     given are by no
       activities and draw up a table in             Smoke breaks                                    means
       the space below that indicates the            Private phone calls (or abuse of                exhaustive
       cost of these three activities to the          phone calls, internet, eMail, fax)              although it goes
 3                                                                                                    beyond the
       company.                                      Failure to meet critical dates                  range
                                                     Damaging company property                       statement in the
       Note: When you fill in the table              Misuse of company property,                     unit standard.
       you do not need to give the                    including stationery                            The suggested
                                                                                                      list of costs
       amount of the cost. You only                  Training in irrelevant fields                   incurred is also
       need to identify how the activity                                                              not exhaustive.
       impacts on the company.
The assessor should evaluate #3 and its associated table by looking for at least three relevant non-productive
activities. The explanations given as to the cost incurred should be reasonable in at least two of the examples given
in the table. The candidate is not competent if:
          s/he cannot name at least three such activities, or
          s/he is unable to give a reasonable suggestion as to cost (or possible cost) areas, or
          s/he does not capture this information in a table.



Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                         Page 18

Table

 Activity Activity                                        What does it cost the company?
   No.
          E.g. Smoke breaks, toilet breaks,                  Loss of productive time
          time spent on private calls etc.
    1


             E.g. Missing critical deadlines                 Business interruption
                                                             Lost production
     2                                                       Missed business opportunities


             E.g. Damaging company property                  Business interruption
                                                             Cost of repairing or replacing broken
     3                                                        items
                                                             Lost production
                                                             Missed business opportunities
             E.g. Training in irrelevant fields              Wasted training cost
                                                             Lost development opportunities
     4




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                          Page 19


Exercise 1
No. Exercise                                      Answer                                          Assessment
                                                   Pay in SA currency (Rand)
                                                   Paid daily, weekly, fortnightly or
                                                     monthly
                                                   Paid in cash, by cheque or by                 AC1.2
                                                     direct deposit
       Read through section 32 of the              Cheques or cash must be given                 The checklist
                                                                                                  should contain
       Basic Conditions of Employment                at work, during normal hours and             three
       Act and set out a checklist                   in a sealed envelope                         (preferably the
 1
       showing the regulations governing           Must pay not more than 7 days                 first three) out
       payment of remuneration.                      after completion of work or                  of the five or six
                                                                                                  points that
                                                     termination of employment                    could be given.
                                                   (Reference to exclusion of                    Wording does
                                                     Pension Fund contributions not               not have to be
                                                                                                  “spot on” –
                                                     needed for part of checklist, but            scope for any
                                                     not necessarily wrong)                       reasonable
                                                                                                  interpretation of
                                                  Any 2 relevant reasons can be given.            section 32.
                                                  Some suggestions include:                       The candidate
                                                                                                  is not
                                                      Payment made in local currency             competent if
                                                                                                  s/he:
                                                       protects employee from                         does not
                                                       exchange rate fluctuations                      use a
                                                      Requires payment in familiar                    checklist
                                                                                                      produces 2
                                                       currency which means employee                   or fewer
                                                       does not have to deal with                      valid points
                                                       unfamiliar currency                             on the list
                                                      Direct payments (cash, cheque or
                                                       deposit) ensure employee                   As far as the
       Suggest 2 reasons why these                     receives the money on time (not            second section
 2     regulations help to protect you as              promised money for the future)             is concerned
                                                                                                  the candidate is
       an employee                                    Giving cash/cheque payments                competent if
                                                       during office hours at place of            any 2 valid
                                                       work helps provide a safer                 reasons are
                                                       environment in which employee              given.
                                                       receives payment.                          The candidate
                                                      Sealed envelope adds security              is not
                                                                                                  competent if
                                                       (cash less likely to go missing)
                                                                                                  fewer than 2
                                                      Sealed envelope helps maintain             valid reasons
                                                       confidentiality                            are given.

                                                      Prompt payment reduces the
                                                       chances of employer going
                                                       bankrupt prior to paying
                                                       employee




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                             Page 20

                                                  Annual leave

                                                      Must be at least 21 consecutive days (or
                                                       whatever is in the contract)
                                                      Must be paid leave.
                                                                                                      AC1.6
                                                  Maternity leave                                     The candidate
                                                                                                      should be able
                                                      Must be at least four months. Can start        to identify
       Refer to the legislation and your               any time from 4 weeks before due date.         everything in
       employment contract. Indicate                  Payment determined by Minister, subject        his or her
                                                       to UIF.                                        contract. If
       how much of each type of leave
                                                      May be unpaid leave.                           items are
       you make take. In each case, is                                                                omitted then the
       your employer obliged to continue          Special leave
                                                                                                      candidate
       paying you a salary? The types of                                                              should be able
 3
                                                                                                      to identify the
       leave include:                                 Could apply to sick leave or family            minimum
        Annual leave                                  responsibility leave. Sick leave is at least   entitlement in
        Maternity leave                               6 weeks in a 3-year cycle.                     the Act.
                                                      Family responsibility leave is 3 days
        Special leave                                 when a child is born, when a child is sick     If the candidate
        Unpaid leave                                  or in the event of death of a close            has not done
                                                       relative.                                      this then s/he is
                                                      All these cases must be paid leave.            not yet
                                                                                                      competent and
                                                  Unpaid leave                                        needs to update
                                                                                                      his/her answer.
                                                      Does not have to be granted in terms of
                                                       Act – can be negotiated with employer.
                                                      By definition, not paid.

                                                  Normally you would have to give four                AC1.7
                                                  weeks notice (if you’ve worked for a
       Refer to your employment                   year or longer) in terms of the                     The candidate
                                                                                                      should be able
 4     contract. If you want to resign            legislation. Some contracts may
                                                                                                      to identify
       what do you have to do?                    differ from this, especially in the first           everything in
                                                  year.                                               his or her
                                                                                                      contract. If




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                          Page 21

                                                                                                  items are
                                                                                                  omitted then the
                                                                                                  candidate
                                                                                                  should be able
                                                      The employer has to pay you to             to identify likely
                                                       the end of the notice period               provisions.
       When your service terminates                    (unless you agree with the                 If the candidate
       what are the employer’s                         employer any arrangement not to            has not done
       obligations to you under the                    work out the notice, for example           this then s/he is
       circumstances listed? To answer                 in order to start a new job                not yet
                                                       sooner).                                   competent and
       this question you should consider
 5                                                                                                needs to update
       your own contract and the Basic                The employer also has to pay you           his/her answer.
       Conditions of Employment Act.                   in lieu of any accumulated leave.
       You do not need to consider the                There may be severance pay due             Note that
       Labour Relations Act and its                    (e.g. if termination of employment         details of
                                                                                                  procedures for
       implications.                                   is due to retrenchment).                   dismissal fall
                                                      The employer has to give you, on           into the Labour
                                                       request, a certificate of service.         Relations Act
                                                                                                  which is outside
                                                                                                  the scope of
                                                                                                  this unit
                                                                                                  standard.
                                                  Payments to you:
                                                      Salary
                                                      Allowances
                                                  Payments deducted and paid over                 AC1.8
       List the items that make up the                Pension/provident fund contributions
                                                      Union fees                                 To be
       total payment that your employer:              Medical Aid                                competent the
        Makes to you.                                Tax (Paye)                                 candidate
 6
        Deducts from your salary and                 UIF                                        should come up
           pays over.                                 Garnishee Orders                           with at least
                                                                                                  one item under
        Pays on your behalf.                     Payments on your behalf
                                                                                                  each sub-
                                                      Employer contributions to:
                                                                                                  heading
                                                          o Pension/provident fund
                                                          o Medical Aid
                                                          o UIF
                                                          o Skills Development levy
                                                  The employer has no obligation to
                                                  provide an annual salary review.                AC1.10
                                                                                                  The candidate
       Does your contract provide for an          However. Common market practice                 is competent if
       annual review of your earnings?            is to review salaries on an annual              s/he is able to
 7     Does your employer have to give            basis. Increases could be                       point to the
       you a salary increase?                     inflationary or merit based.                    relevant section
                                                  The employer should have a process              of his/her
                                                                                                  employment
                                                  for granting increases, although they           contract.
                                                  may be listed as “discretionary”.
       Identify the key aspects of the            Items are referred to in Chapter 4 of
       Basic Conditions of Employment                                                             AC1.11
                                                  the Act §§32 to 35. Some key points:            To be
       Act that impact on remuneration.            Employer must keep record                     competent the
       Present these aspects in the form
                                                   Must follow rules of payments                 candidate must
       of a mind-map. Use the space on                                                            show at least
 8                                                 Must give employee payslip
       the right for your notes and the                                                           two of these
       space below for you mind-map. (If           Can only make deductions within               items in a mind-
       you don’t know, you may ask the                limits                                      map, with two
       facilitator or assessor to explain          Has to follow rules on calculating            extra branches
                                                                                                  off the points.
       what a mind-map is).                           remuneration

Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                         Page 22

Mind map – Example




                                                     Could be, but normally is not
                                                     guaranteed – check contract.
                                                                                                  AC1.12
       Are you entitled to a bonus? If
                                                     Bonuses are taxed along with normal
 9     you are paid a bonus how is it                                                             These two
                                                     pay. Often the tax is higher than on
       taxed?                                                                                     questions are
                                                     normal pay as it is subject to a tax         fairly
                                                     rate in a higher tax bracket.                challenging. To
                                                                                                  be competent
                                                     Deferred pay is any kind of pay that         the candidate
                                                                                                  does have to be
                                                     is delivered at a later date, e.g. on        able to answer
                                                     retirement or as part of a severance         both questions
                                                     package.                                     with a
       What is deferred pay? How is it                                                            reasonable
10                                                                                                degree of
       taxed?                                        Often these arrangements have                accuracy.
                                                     special tax benefits, e.g. a tax-free
                                                     portion, with the rest taxed at              See below
                                                     average rates rather than marginal
                                                     rates.
The candidate is competent against AC1.12 if s/he:
   Identifies whether or not s/he is entitled to a bonus (or under what circumstances)
   Knows that bonuses are taxed with pay
   Defines deferred pay reasonably accurately or gives an example
   Knows that there is favourable tax treatment

The candidate is not competent if s/he is not competent in any one of these four areas




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                         Page 23


Exercise 2
No. Exercise                                      Answer                                          Assessment
                                                                                                  AC2.1
                                                  Examples include
                                                                                                  To be
                                                   Pension Fund                                  competent the
       What standard deductions are                Medical aid                                   candidate must
       made from an employee’s salary              Tax                                           be able to name
                                                                                                  3 standard
 1     or wages? Give at least 3                   UIF                                           deductions and
       examples, and indicate if any of            Insurances                                    point out
       these are shown on your payslip.            Union fees                                    whether or not
                                                   Garnishee order, if applicable                they are listed
                                                                                                  on his/her
                                                                                                  payslip.

                                                  Compulsory = Tax, UIF and
                                                  Garnishee order

                                                  Voluntary = Union Fees, membership
                                                  of staff club, payments to staff                AC2.2
       What deductions on your payslip            charity, etc. (anything that can be             The candidate
       are compulsory and what are                shown as voluntary                              should identify
 2
       voluntary?                                                                                 at least three
                                                  Pension Fund, Medical Aid and                   items correctly
                                                                                                  as voluntary or
                                                  Insurance may be compulsory if they             compulsory.
                                                  are a condition of employment (see
                                                  contract)




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                         Page 24

                                                                                                  AC2.4
                                                  Income includes salary/wages,                   To be
                                                  overtime, bonuses, commissions,                 competent the
                                                  plus any allowances. These should               candidate must
       Refer to your payslip.                                                                     be able to verify
                                                  add up to “total pay”                           his/her payslip.
       List the items of income (name                                                             The candidate
       and amounts).                              Deductions should be those agreed               may get one or
                                                  (or compulsory). These can be                   two items
                                                                                                  wrong
       List all the deductions (name and          calculated as follows:
                                                                                                  (especially tax,
       amounts).                                   Pension Fund – percentage                     which may
                                                      specified                                   need to be
       Check that the deductions are               Medical aid – rate specified for              checked
 3                                                                                                against
       correct – show your calculation.               chosen plan, income level and               previous slip).
                                                      dependency status
       Note: You do not have to check              Tax – should follow from tax                  The candidate
       the amount deducted for tax                    tables (which may not be                    is not
                                                                                                  competent if
       unless you are given access to                 available)
                                                                                                  s/he does not
       the SARS tax deduction tables.              UIF – 1% up to a maximum of                   check at least
       Ask the facilitator or the assessor            about R80,99 (April 2002 figure)            one item under
       if you are not sure.                        Insurances – as agreed                        deductions or
                                                                                                  fails to balance
                                                   Union fees – as per union                     income against
                                                  Garnishee order – as per court order            deductions in
                                                                                                  order to check
                                                                                                  the balance (net
                                                                                                  pay).




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                         Page 25


Exercise 3
No. Exercise                                      Answer                                          Assessment
                                                  Any employment contract (verbal or
                                                  written) will do, from school time              AC3.1
       Give an example of where you               helping someone out for small
 1     have traded your labour for                change through to a formal full-time            Any
       remuneration.                              job.                                            employment
                                                                                                  example is “OK”


                                                  §34 of the Act deals with this. A
                                                  summary is:

                                                      Employer may not deduct without
                                                       employee’s agreement in writing            AC3.4
                                                       (subject to exceptions).                   The candidate
                                                      There are special rules about              is competent if
                                                       deductions to repay the employer           s/he gets the
                                                       for loss or damage.                        general gist of
                                                                                                  this model
                                                      If in respect of goods purchased           answer or a
                                                       the nature and quantity of goods           relevant
                                                       purchased                                  alternative.
       Outline the regulations that related
       to deduction of money from your                Deductions for payment to third
                                                                                                  The candidate
 2                                                     parties must be paid over
       pay. Refer to examples in your                                                             is not
                                                       promptly.                                  competent if
       payslip.
                                                      There are special rules/limits             s/he does not
                                                       concerning what an employer can            mention at least
                                                                                                  one relevant
                                                       or cannot require of the                   (and existing)
                                                       individuals as far as deductions in        regulation or
                                                       favour of the employer are                 does not relate
                                                       concerned.                                 at least one
                                                      In the reference to examples in            matter to
                                                                                                  his/her payslip.
                                                       the payslip tax and UIF rank as
                                                       the exceptions the first item.
                                                       Others should be subject to a
                                                       written agreement




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                         Page 26


Exercise 4
No. Exercise                                      Answer                                          Assessment
     Company A offers you:
      A cash salary of R4.000 per
         month                                                                                    AC4.2
                                                                                                  The costs are
                                                  Under A it is R4.000 per month.                 both R4.000pm.
       Company B offers you:                                                                      The candidate
        A salary of R3.000 per month             Under B it is:                                  is competent if
        A pension fund where it                        Salary        R3000                       s/he gets both
                                                                                                  answers
 1       contributes 10% of your salary                 Car allowance R500
                                                                                                  correct.
        A car allowance of R500 per                    Pension       R300 (10%)
         month                                          Medical       R200                        The candidate
        A contribution to your medical                 Total         R4.000 pm                   is not
                                                                                                  competent is
         scheme of R200 per month                                                                 s/he gets one
                                                                                                  wrong.
       What is the cost to company of
       each of these contracts?
                                                  a.

                                                  R60.000 per annum = R5.000 per
                                                  month

                                                  b.                                              AC4.3
                                                                                                  The candidate
                                                  R4.330 per month = R1.000 per                   should be able
                                                  week                                            to get these
                                                                                                  answers. Note:
                                                  c.                                              Different
                                                                                                  answers for
       Convert the following salary                                                               daily and hourly
       packages:                                  R1.250 per week translates to R250              rates are
                                                  per day ASSUMING THAT WE’RE                     permissible if
       a. R60.000 per annum to                    TALKING ABOUT A 5-day working                   based different
                                                                                                  day/week
 2        monthly                                 week.
                                                                                                  lengths.
       b. R4.330 per month to weekly
       c. R1.250 per week to daily                d.                                              The candidate
       d. R240 per day to hourly                                                                  is competent if
       e. R40 per hour to annual                  R240 per day = R30 per hour                     s/he gets four
                                                                                                  out of five
                                                  ASSUMING THAT WE’RE TALKING                     correct.
                                                  ABOUT AN 8 HOUR WORKING
                                                  DAY                                             The candidate
                                                                                                  is not
                                                                                                  competent if
                                                  e.
                                                                                                  s/he gets two or
                                                                                                  more wrong.
                                                  R40 per hour = 40x8x5x4.33x12 =
                                                  R83.136, again assuming an 8 hour
                                                  working day and 5 day working week.




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                         Page 27

                                                  The task and the suggestion must be
                                                  reasonable. Some ways of                        AC4.6
                                                                                                  The candidate
                                                  improving productivity:                         only needs to
                                                   Automate                                      make one
       Consider your own job. Describe             Cut out unnecessary steps                     relevant
       a task that you perform and                 Remove obstacles or blockage                  suggestion.
 3
       suggest how you might do it more            Improve skills                                A candidate is
       productively.                               Practice tasks to be able to speed            not competent
                                                     them up.                                     is his/her
                                                                                                  suggestion
                                                                                                  doesn’t exist or
                                                                                                  is impractical

                                                  Brief job description should tie in with
                                                  employment contract or letter of
                                                  appointment.

                                                  Value added could be direct.
                                                  Examples:
                                                   Produce or do something of value              AC4.7
                                                   Sell something, thereby
                                                                                                  A candidate is
                                                     generating value                             competent once
       Describe your job briefly. How do                                                          s/he gives a
 4
       you add value to your employer?            Alternatively it could be indirect.             brief description
                                                  Examples:                                       of his/her job
                                                                                                  and finds
                                                   Supporting someone who                        something of
                                                      produces direct value                       value in it.
                                                   Providing general back office
                                                      support for the business that
                                                      improves the productivity of
                                                      others in the organisation.




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                         Page 28


Group exercises
No. Topic                                         Notes                                           Assessment
                                                                                                  AC1.3

       Four different types of                                                                    The candidate
                                                                                                  should show
       employment are:                                                                            some evidence
        Permanent                                                                                of having
        Temporary                                                                                completed a
        Contractual                                                                              group exercise
                                                                                                  and listed some
        Part-time                                The aim of this exercise is to get              points under the
                                                  candidates to explore the factors that          12 headings
       A. What are the financial                  go into setting up an employment
                                                                                                  given below.
          implications of each of these           contract. It is not necessary to have           To score the
          types of employment?                    a “right” answer, since circumstances           exercise the
       B. How does selection and                  and experiences may vary.                       assessor
 1        recruitment work for each of                                                            should count
          these types of employment?                                                              the number of
                                                  The attached table contains samples             blocks
       C. How does dismissal work for             of the kinds of points that the                 containing an
          each of these types of                  candidate should include in his/her             answer which is
          employment?                             final answer.                                   not blatantly
       D. What documents make up the                                                              wrong. A
          contract in each case and                                                               candidate is
                                                                                                  competent if
          what goes into these                                                                    there are at
          documents?                                                                              least 8 such
                                                                                                  blocks.
       You can use the space on the
       right for notes and the table below                                                        A candidate is
                                                                                                  not competent if
       for your answers.                                                                          there are fewer
                                                                                                  than 8 such
                                                                                                  blocks.




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                                     Page 29

Types of contract

 Type of contract            Financial                 Selection and             Dismissal                Structure of
                            implications                recruitment                                         contract
 Permanent                  Secure for                Formal                  Dismissal has to         Formal letter of
                             employee                   recruitment and          follow agreed             appointment
                            Payments usually           selection process        procedures               Specifies start
                             monthly or weekly                                  Normal                    date, salary,
                            Annual review of                                    resignation               position offered,
                             salary or wage                                      provisions                reporting line,
                            Often has                                                                     leave entitlement
                             employee                                                                      and notice
                             benefits attached                                                             provisions.
                            Normal PAYE                                                                  Subject to general
                             provisions                                                                    terms and
                            Could get bonus                                                               conditions,
                             or 13th cheque                                                                including staff
                            Paid annual leave                                                             handbook,
                                                                                                           negotiated
                                                                                                           agreements, etc.
 Temporary                  Less secure for           Can have less           Natural dismissal        Letter of
                             employee                   formal recruitment       at end of                 appointment,
                            Payments could             process                  temporary period          probably detailed
                             be as for                 Can be by means          – no need to              in order to deal
                             permanents but             of contacting            renew contract            with specific
                             could also be              agency                  Process for early         conditions of
                             hourly or daily                                     dismissal may             employment that
                            Wage set at                                         differ from               differ from staff
                             outset; not                                         process for               handbook
                             normally reviewed                                   “permanent”              Otherwise similar
                            Unlikely to attract                                                           to “permanent”
                             employee
                             benefits
                            PAYE may be
                             subject to special
                             provisions
                            No bonus
                            No annual leave
                            May pay a higher
                             wage in lieu of
                             benefits
 Part-time                  Usually as for            Same as for          Same as for                  Same as for
                             “permanent” but            “permanent”          “permanent”                   “permanent”
                             based on fewer
                             working hours
                            Salary levels
                             often “pro rata”
                             with full-time
                             employees
 Contract                   Low employment            Recruitment can         Natural dismissal        Contract drafted
                             security                   be through a             through not               to deal with
                            Payments per               tendering process        extending                 specific items
                             contract or on             or less formal           contract                  related to the
                             hourly or daily            recruitment             Early termination         project or task for
                             rate                                                of contract can be        which the
                            Wage negotiated                                     dealt with by             individual is
                             per contract; not                                   contract law or           employed.
                             reviewed                                            specific                 Contract would
                            No employee                                         provisions of the         cover:
                             benefits                                            contract signed.         - parties to the
                            Special                                                                       agreement
                             arrangements for                                                             - what has to be
                             PAYE                                                                          delivered
                            No bonus (usually                                                            - when it must be
                             – may have                                                                    delivered (or for
                             completion                                                                    how long it must
                             bonus)                                                                        be delivered)
                            No annual leave                                                              - the price to be
                            May pay a higher                                                              paid
                             wage in lieu of
                             benefits

Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                           Page 30

                                                    Basic salary
                                                    Employer contributions to
                                                         o Pension/provident fund
                                                         o Insurances
                                                         o Medical aid (or medical
                                                             scheme)
                                                         o UIF, Workmen’s
                                                                                                   AC1.9
                                                             Compensation and Skills
                                                             Development levy could                The four items
                                                             technically be included               should fall in to
       What can go into a remuneration
 2                                                 Allowances:                                    the list given.
       package? List at least four items                                                           The candidate
                                                         o Car allowance or                        should have at
                                                             company car                           least three
                                                         o Tool allowance                          correct.
                                                         o Entertainment allowance
                                                                                                   The list of costs
                                                         o Cellphone allowance
                                                                                                   and benefits
                                                         o Housing subsidy                         should be
                                                   Variable pay:                                  checked for
                                                         o Bonus/13th cheque                       reasonability.
                                                         o Share option or share                   The candidate
                                                                                                   should have
                                                             ownership schemes                     relevant
                                                  Cost to you                                      answers under
                                                                                                   at least three of
                                                      May also have to contribute (to funds)      the four
                                                      Possible fringe benefit tax on allowances   headings.

                                                  Benefit to you                                   Candidates are
                                                                                                   not competent if
                                                      Give answer relevant to chosen item         they:
                                                       (e.g. retirement provision, affordable          Do not
       Choose one of the remuneration
                                                       housing, etc.)                                   have at
       package items. Identify the cost                                                                 least three
                                                      May be tax efficient
       and benefit implications for you                                                                 points
       and your employer (assuming you            Cost to employer
                                                                                                        made in
       were offered this item in your                                                                   both #2
 3                                                                                                      and #3.
       salary package).                               Cost equals cost of benefit                     Do not
                                                      Note that with some, e.g. company car,           identify the
                                                       the timing of payments differs                   package
       Chosen item: <<Must be filled                                                                    item
                                                  Benefit to employer                                   discussed
       in>>
                                                                                                        under #3.
                                                      Benefit may attract good staff
                                                      Sometimes creates an incentive to good
                                                       performance or a sense of security in the
                                                       workplace
                                                      May support productive business
                                                       activities, e.g. entertainment allowance




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                         Page 31

                                                                                                  AC2.3
                                                  It is possible to give frivolous                Any reasonable
       There is a limit of 25% on salary
                                                  answers to this question, e.g.                  explanation
       deductions. Why is this? Create
                                                  “because the government says so!”               would render a
       a case example to illustrate your                                                          candidate
                                                  Competent candidates should be
       answer.                                                                                    competent. It
 4                                                able to advance a reason, notably
                                                                                                  should be
                                                  around the issue of protecting                  backed up by a
       Use the space on the right for
                                                  employees against over-extension                “case study”
       notes and the space below for
                                                  through debt traps etc.                         that illustrates
       your group answer.                                                                         the explanation
                                                                                                  given.

Reasons for limiting deductions

The case study can be fictitious (probably should be). A typical case would be one that includes
a low paid employee. The employer allows the employee to borrow against future earnings to
deal with short-term domestic issues (e.g. feeding the family). Because the employee has to
pay back the borrowings his/her take-home reduces (due to repayments on the loan) therefore
s/he has to borrow more. The cycle repeats itself until the employee is completely debt-trapped
– cannot borrow more because s/he has no income left to pay for further borrowings.

This can be aggravated by high interest rates. Given the power balances in an employer-to-
employee relationship it is possible that unscrupulous employers could bankrupt employees in
this way.

There Is much scope for alternative case studies, and what is written here is purely by way of
example.




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits
                                                                                                         Page 32

                                                                                                  AC3.2
                                                                                                  The candidate
                                                                                                  must give three
                                                                                                  examples, rank
                                                                                                  them by value
                                                                                                  per hour and
       As a group discuss the value of an                                                         give at least
                                                  The three examples could be drawn               one reason.
       employee’s labour in the work-                                                             Two of the
                                                  from a near infinitely wide range and
       place.                                                                                     examples have
                                                  even examples would be spurious.
                                                                                                  to be relevant.
                                                  The important fact is that they must
       Come up with three examples of
                                                  be value-generating activities, e.g.            A candidate is
       activities that an individual does
                                                  having tea is not (unless it is shown           not competent if
       that adds value.                                                                           s/he:
                                                  to add to staff morale, which makes
                                                                                                      Gives
 5                                                them more productive).
       Consider these three activities.                                                                fewer than
       Estimate which adds the most                                                                    three
                                                  Activities that rank higher in value                 examples
       value for every hour worked. Give                                                          
                                                  tend to be those involving higher                    Does not
       brief reasons for your answer.                                                                  have at
                                                  levels of education and training or
                                                                                                       least two
                                                  rarer skills. Some examples are                      relevant
       Use the space on the right for
                                                  given below.                                         examples
       notes and the space below for
                                                                                                      Hasn’t
       your group answer.                                                                              ranked
                                                                                                       them by
                                                                                                       value
                                                                                                      Hasn’t
                                                                                                       given a
                                                                                                       reason for
                                                                                                       the
                                                                                                       rankings
Examples of ranking:
 Wine taster more than grape picker (rarer skill)
 Accountant signing off audit more than bookmaker drawing up accounts (higher education
   and training level)
 International footballer entertaining crowd more than mediocre footballer playing a local
   match (higher performance level)




Facilitator Guide
Unit Standard 10717: Examine the application of the Basic Conditions of Employment Act and its effect on earnings
                     in own contract
Level 2, 2 Credits

								
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