In light of rising food prices following the nationwide drought and weakened value of the rand, employers can expect additional pressure from employees for annual salary increases. Many employees are desperate for an increase in order to make ends meet; however, the challenging economic climate makes it difficult for employers to provide an annual raise to their entire staff. Employers must therefore approach the situation very strategically.

This is according to Francois Wilbers, MD of Work Dynamics – a leading organisational psychologist consultancy in the country, who says that often the workforce doesn’t realise that employers are exposed to exactly the same circumstances and are also battling to keep a steady revenue stream. “Granted, in larger corporations, the extent to which they are exposed is less than in smaller organisations, as smaller establishments experience the economic changes with far more severe financial consequences.”

Wilbers says that it is important to note that salary increases are not regulated by labour legislation, except in as far as may be provided for in any agreement or collective agreement, where provision is usually made for annual wage or salary negotiations. “Essentially, in the absence of any such agreement, salary increases remain a matter of mutual interest between employer and employee, therefore, there is no obligation on the employer to grant annual increases. With that said, if any party in a relationship finds it necessary to refer to the ‘terms of a contract’ as a point of departure in engaging with each other, it says something about the nature of trust between the parties.”

Wilbers adds that in cases where employers cannot afford to pay an increase equal to the consumer price index (CPI), they need to be honest with their staff members and accept the premise of them seeking alternative employment. “It is absolutely essential to maintain an open dialogue rooted in transparency and honesty in order to handle the situation effectively. For example, don’t use the detrimental state of the economy as an excuse to not grant your employees annual increases if you are still increasing profitability.”

When trying to asses the best option for your organisation, the retrenchment of staff members is a pressing threat that must be avoided at all costs, he explains. “For organisations in financial distress one of the most common ways to solve the problem is to retrench staff. From a socio-economic point of view, employers should try to avoid retrenchments and rather think of more creative alternatives. This option is especially less desirable in our country, as our unemployment rate of 25% is of the highest in the world.

“In addition to the socio-economic impact of retrenching staff, the effects on employee morale can be devastating, especially if the process is not handled in a professional and transparent manner. First prize is to avoid retrenching staff altogether.”

Wilbers explains that there are a number of alternatives that can be implemented to avoid the process of retrenchment and that these could end up being a mutually beneficial solution. “One of the most common steps organisations take is to forfeit guaranteed year-end bonuses and to rather assign bonuses according to targets that are achieved.

This incentive system is a great tool for maintaining committed and hardworking employees, while weeding out those that are not target driven, says Wilbers “In extreme cases, organisations can also implement salary cuts rather than retrenchment. “Again the key here is mutual honesty between employer and employee. The employer could for example allow the employee to take on freelance opportunities in order to supplement his or her decreased salary.”

Wilbers continues that other tried and trusted alternatives to retain staff is to implement annual increases subject to affordability, on a ‘pay-as-you-go’ basis. “Here you would have to decide whether you can actually afford the increase. You would have to look at the company’s performance over the first quarter and then see whether you can afford to pay an increase for that quarter. Increase will be paid in the form of a cash amount for the first quarter or spread equally over the second quarter.”

Some orgnisations opt for a performance-based pay on top of current salaries. “In exchange for sacrificing annual increases, staff will be offered the opportunity to earn incentives if targets are achieved. These targets must be set in such a way that there will actually be enough money available to fund the incentives.”

Another effective way would be to pay certain allowances to key staff – despite the difficult economic times – is for companies to keep in mind that they still have to compete for talent, explains Wilbers. “If you are afraid you may lose some of your key staff, consider paying them an allowance to retain their services, without giving an annual increase to other staff.”

“Ultimately, organisations differ in their ability to sustain staff and afford salary increases. Retrenchments in harsh economic conditions should always be avoided. The key is to seek solutions that will be of mutual interest to the employer and employee and engage in a proactive and honest way to find creative solutions,” concluded Wilbers.

A petrol price hike of between 17 cents and 18 cents a litre is likely in May‚ according to the Automobile Association (AA).

Diesel and illuminating paraffin‚ however‚ are set for decreases of 11c to 12c a litre.

Commenting on unaudited mid-month data released by the Central Energy Fund (CEF)‚ the AA said on Monday that rising international oil prices were continuing to do battle with gains in the rand/dollar exchange rate.

“We are seeing a gradual‚ but sustained return of strength to petroleum prices‚” the AA says.

“On the international market‚ diesel and petrol prices have risen since late February‚” the Association explains.

“The appreciation of the rand against the US dollar has gone some way to offset this‚ meaning that diesel and illuminating paraffin are heading for reduced prices‚ while petrol is set to climb‚” it adds.

“Both the exchange rate and international oil prices continue to be volatile‚ and the month-end picture could be quite different from the current one‚” the AA says.

Source: www.bdlive.co.za

South Africa has the highest number of highly-skilled women professionals of any African country who are emigrating to other countries because of limited career opportunities at home.

This is according to an analysis of data by the Organisation for Economic Co-operation and Development (OECD), which shows the migration patterns between all African countries and OECD countries.

The OECD is made up of 35 countries, including the United States, Australia, New Zealand, the United Kingdom and several European countries.

This, combined with the analysis of data from the Institute for Futures Research at the University of Stellenbosch and the Commission for Gender Equality, shows that the number of women leaving South Africa for the world’s most popular immigrant destinations is growing faster than the men who are moving to the same countries.

Out of 86 countries that South Africans emigrated to, those that experienced the highest migrant influx were the United Kingdom, Australia and the United States.

These three countries received 967,619 migrants from South Africa from 2010 to 2013. Of these, almost half — 486,134 — were women. In the 2010-2011 period the number of women migrants to these countries outnumbered men.

Commission for Gender Equality commissioner Janine Hicks said women professionals were likely to seek career opportunities in other countries because their representation in managerial positions and directorships were still disproportionately low.

“If you ask about a push factor, it’s that we are out there but we are not getting access to senior positions. Gender transformation groups have put out figures that point to poor gender transformation,” Ms Hicks said.

While women made up 46.8% of the employed population in 2013/2014, their representation was at 29.3% among executive managers, 9.2% among private sector chairpersons of boards and as low as 2.4% among CEOs of JSE-listed companies, she says.

Also at issue were rigid attitudes in the professional environment regarding the inclusion of women in key decision-making. And there was a failure on the part of the private sector to recognise the needs of women when fulfilling their corporate social responsibility obligations, especially in rural areas where access to services was limited.

“Mining companies in Mpumalanga claim they struggle to retain women professionals. Mining companies in South Africa are based in rural areas, so some would joke that there is no Woolworths in Secunda so it would be hard to retain a woman there,” Hicks says.

“But they don’t seem to want to talk about investing in services that women working in these rural areas need, such as schools to send their children to, and gynaecologists. In fact I challenge you to find one gynaecologist in Secunda,” she says.

Mienke Steytler of the South African Institute of Race Relations said women were most affected by the lacklustre performance of the South African economy, which hampered their employment prospects.

“Young women tend to take advantage of the opportunities offered to them and if these opportunities are in other countries, they will take them, especially if they face such a high chance of not finding work,” Ms Steytler said.

Australia, Canada, New Zealand and the United Kingdom favoured highly skilled female migrants, and there were also fewer concerns for women over crime, healthcare, and education among other things, she said.

By Khulekani Magubane for www.bdlive.co.za

Fears of a further slowdown in the economy and political risks pushed the rand over the R15/$ level again yesterday, and a key index showed that private companies are battling to survive, write Ntsakisi Maswanganyi and Maarten Mittner.

The Standard Bank whole economy purchasing managers’ index (PMI) fell to 47 from 49.1 in February — the most marked deterioration in operating conditions in more than a year and a half. Readings below 50 signal declines.

This means less investment, further job losses and limited support for economic growth — one of the reasons SA is at risk of a credit rating downgrade.

The average PMI for the first quarter was the worst since the inception of the survey almost five years ago.

The rand tanked more than 2% to R15.13/$ after President Jacob Zuma survived a motion to impeach him in Parliament.

Global risk aversion also dragged down the rand and the JSE which closed in the red.

Rating agencies would take the political situation in SA into account when reviewing its credit rating, Finance Minister Pravin Gordhan said after Parliament voted against impeaching Mr Zuma.

“Politics, economics and the fiscal situation are all things rating agencies watch out for. South Africans should be aware of that,” Gordhan says.

Source: www.bdlive.co.za

SA to brace for a tough April

In just a few days’ time, South Africans will feel the real impact of the struggling economy as inflation records a seven-year high, the drought deepens and several everyday items go up in price.

Already, non-governmental organisations are seeing increases in the number of poor South Africans experiencing malnutrition.

Next month, Eskom hikes the price of electricity by 9,4%, petrol and the new fuel levy will cost 80c more a litre and DStv subscription goes up by 8%.

Moreover, the prices of many foodstuffs have over the past few months been climbing, driven by inflation and the drought. The Reserve Bank said last week that inflation had reached 7% in February.

The poor are the worst hit. Already, one in four children go to bed hungry, according to data from the Human Sciences Research Council’s National Health and Nutrition Examination Survey.

“We expect life to get much worse for the poor,” said Mervyn Abrahams, CEO of the Pietermaritzburg Agency for Community Social Action. “People struggle to get by day to day.”

He said there was a pensioner who no longer bought vegetables because they had become too expensive as a result of the drought.

Abrahams said he also knew of a boy receiving food through his school’s feeding scheme. He said the boy brought his plastic container to school so he could take his lunch home to feed his three-year-old and five-year-old siblings.

Abrahams said his organisation had calculated that a basket of food containing enough protein and vegetables would cost a family of seven R4239 a month. An average household in Pietermaritzburg survives on R3200 a month .

On the West Rand, activist Cora Bailey said she had seen an increase in the number of hungry people approaching NGOs for food. In one instance, a grandmother approached an NGO with a baby.

“The mom has abandoned the child. The grandmother is [an illegal immigrant] from Lesotho and can’t apply for the child support grant. She didn’t have money for baby formula. The child looked [unhealthy] and she didn’t look too good herself,” said Bailey. “I had to split a food parcel for two with four people on Thursday.”

“I think we’re going to have a food revolution,” she added.

“When winter comes and people are both cold and hungry, we’re going to see huge problems. Honestly, I don’t know how people are coping.”

Economist Dawie Roodt said the situation looked bleak as more interest rate hikes were likely.

Already, a middle-class family with a R1-million bond faced a R300 increase in monthly mortgage repayment following the recent interest rate hike.

Interest rate hikes, he explained, meant people paid more for their debt and there was less money in the economy.

Less spending caused factories to produce less, which led to retrenchments Roodt added.

Middle-class families face further squeezes, with the petrol price increase at 41c a litre next month. But with increased taxes on fuel, it is likely to cost about 80c more, according to the SA Institute of Race Relations. The institute’s Ian Cruickshanks said with the rising food and fuel prices, the government had to realise it had to start spending what it had.

Roodt also said the weakening rand meant imported goods were more expensive. “High unemployment and the high cost of imported goods could be an opportunity for entrepreneurs to create jobs and factories to make things.

”But the government must stop harassing business owners and taxing them to death.”

By Katharine Child for www.timeslive.co.za

Alan Amron has invented a battery-powered squirt gun, a digital photo frame, even a laser system that may someday provide a visible first-down line for fans inside NFL stadiums. He holds 40 US patents, but he’s most interested in an invention for which he gets no credit: the Post-it Note, that ubiquitous sticky-back product made into a worldwide success by the 3M Company.

Amron, 67, says he invented what he called the Press-on Memo in 1973, a full year before 3M scientists developed what later became known as the Post-it Note. Although Amron settled a previous lawsuit against 3M, he’s suing again in federal court in Fort Lauderdale. He says the company breached its previous agreement not to take credit. The settlement is confidential.

Now Amron wants $400 million in damages – and something he says is even more important to him.

“l just want them to admit that l am the inventor and that they will stop saying that they are the inventor,” Amron says in a recent interview. “Every single day that they keep claiming they invented it damages my reputation and defames me.”

3M, based in Maplewood, Minnesota, is a one of the 30 companies that make up the Dow Jones Industrial Average on the New York Stock Exchange. The maker of Scotch tape, Ace bandages, sandpaper, films, office products, window insulation, paint remover and hundreds of other products earned more than $30 billion in revenue in 2015, according to the company’s website.

The company says Post-it Notes were invented by 3M scientists Arthur Fry and Spencer Silver, both members of the National Inventors Hall of Fame. Silver came up with the adhesive—one that could be used over and over yet not mar surfaces to which it attached—and Fry the idea of using it for the small, yellow squares of paper to become sticky-back notes.

“3M developed Post-it Notes without any input or inspiration from Mr. Amron and it is false and misleading for him to state or suggest that he created, invented, or had any role in the product’s development,” says company spokeswoman Donna L. Fleming Runyon in an email. The company declined to comment further on the lawsuit.

Alan Amron talks to a reporter in West Palm Beach, Fla. Amron is suing 3M Company in a South Florida federal court in a dispute over who invented the ubiquitous Post-it Note.

Fry, now 84 and retired, is named as a defendant in Amron’s lawsuit, but Silver is not. Fry did not respond to an email and a phone message seeking comment. Silver also is retired, Runyon says.

The history of invention is full of people competing for credit for the same idea, and often things come about because smart people are working separately. Take the microchip: Texas Instruments and Fairchild Semiconductor battled for a decade in court over who came first and deserved the patent, deciding amid the wrangling it was best to work out a licensing deal for both companies.

Amron says his idea in 1973 came about with chewing gum. He was looking for a way to stick a note on his refrigerator for his wife and used gum, providing inspiration for the adhesive he would use on his Press-on Memo. That year he took the sticky notes to a New York trade show and met briefly with two 3M executives, Amron says, but nothing came of the meeting.

Fry and Silver came up with what 3M originally called the Press ‘n’ Peel memo pad in 1974, but it wasn’t brought to the market until 1977 and didn’t really take off until 1980, when it was renamed the Post-it Note. It’s now one of the top-selling items in 3M’s consumer products division, which in 2015 earned $4.4 billion for all products, company figures show.

Post-it Notes have become so iconic that in the 1997 movie “Romy and Michele’s High School Reunion,” the title characters, played by Lisa Kudrow and Mira Sorvino, claim credit for inventing them to impress their former classmates.

It was also in 1997 that Amron sued 3M claiming he was the true inventor. The case was settled, and Amron agreed to release the company from any future claims, which intellectual property lawyers say could make his new Florida lawsuit difficult to win.

“I would predict what he has left perhaps is the enforcement of a settlement agreement but not the claims he is pursuing,” says Miami attorney Jeffrey Feldman, who is not involved in the case. “The first thing I would want to know is whether or not there was an agreement between them regarding who was allowed to say what.”

Amron says the agreement was that neither could claim credit because, years earlier, a Swiss inventor had supposedly devised a similar product. But that turned out to be a less-useful adhesive, not the entire sticky note, and Amron says he felt 3M used the Swiss tale to trick him into the settlement – and is now breaching that deal by claiming credit for the product.

No trial date is set for Amron’s lawsuit, which survived a 3M initial attempt last month to get it thrown out based in part on the prior settlement of similar claims. A federal judge has ordered both sides into mediation to possibly reach a settlement and set various legal deadlines through December of this year.

Meanwhile, 3M continues to invent things. According to the company’s year-end 2015 statement, 565 U.S. patents were granted to 3M—bringing its total to more than 105 000.

By Kirk McKoy for www.cnbc.com

An employer can dismiss a worker for inappropriate, insensitive and racist content posted on social media, even if it does not have anything to do with the employer or company, says Werksmans Attorneys.

Company director Bradley Workman Davies explains that this was because companies could face a backlash from customers, prospective customers and other stakeholders because of association, through the employment relationship, with the social media content of employees.

“As such, employers are entitled to be concerned about and to take action for inappropriate content posted by employees, as this has a potential to harm the business of the employer,” Davies says.

“Equally, employees should realise that in the digital age, with regards to the employment relationship, nothing posted publicly is private or irrelevant,” he adds.

In recent weeks, several incidents made headlines when employees were fired or suspended for their social media posts, which employers deemed inappropriate, insensitive or racist.

One of the more prominent incidents was that of media personality Gareth Cliff who was booted off the Idols show for tweeting on freedom of speech during the Penny Sparrow race debacle.

Cliff had tweeted that people did not really understand freedom of speech, which led people to assume that he supported Sparrow’s right to label black beachgoers as monkeys.

Cliff lodged an urgent application in the High Court in Johannesburg and on Friday M-Net was ordered to re-instate him.

eNCA news anchor Andrew Barnes was also given a two-week suspension last month after he mocked Basic Education Minister Angie Motshekga’s pronunciation of the word “epitome”.

After receiving backlash on social media, he issued a public apology to the minister.

Action against an employee did not necessarily happen because of a breach of contract through their conduct, but because the employment relationship was based on trust. It could also be based on the broader category where the conduct could be seen to have the intention or effect of breaking the trust relationship between the two parties.

Davies explains that employers always had to afford the employee the right to make representations as to whether they were guilty before taking a decision on what action, if any, would be taken against an employee.

Davies says an employee’s social conduct outside of the workplace could also have an impact on the working relationship.

“This is a recognised principle of South African labour relations, which was acknowledged even under previous iterations of the Labour Relations Act (the 1954 Labour Relations Act, replaced in 1995), and applied by the Industrial Court historically.”

Davies used the example of an employee of Nehawu who was fired after being found guilty of misconduct after he consumed alcohol after hours while at a union congress.

“In this case, the adjudicator found that ’employees are considered to be employees 24 hours out of 24 hours at a congress’ and therefore, after hours consumption was as good as consumption during working hours.”

In another incident, an employer chose to fire colleagues who had had a fight outside of working hours.

“[This] resulted in a strained working relationship and the inability of a continued employment relationship,” Davies says.

He explained that the employment relationship was based on an inherent basis of trust and good faith and any action which caused a break in that relationship could justify the dismissal of the employee.

The same applied when an employee made a direct reference to his employer or colleague on a social media post.
Davies highlighted that the constitutional right to freedom of expression was not absolute. It was limited by Section 36 of the Constitution.

“It is important that when a person exercises the said right, she does not encroach on other person’s rights,” he says.

By Naledi Shange for News24

Amazon puts roots in SA

While global online retail company Amazon.com widens its net with online food shopping and walk-in bookstores, its Web services division is making inroads in South Africa.

Amazon Web Services says it is recruiting 250 people for its offices in Cape Town and Johannesburg.

The company offers cloud computing for other companies. Cloud computing refers to the on-demand delivery of IT resources and applications via the internet with pay-as-you-go pricing.

The head of technology and solutions architecture at Amazon, Attila Narin, says the company had recognised the potential for growth in South Africa where Cape Town and Jo’burg acted in perfect unison.

“Cape Town is ideal for the technical side of things, and Jo’burg is perfect for the customer-facing side of things. In fact, some of the core technology for Amazon’s cloud computing used across the globe was built right here in Cape Town,” says Narin, who is based in Luxembourg but worked in Cape Town from 2006 to 2008, and was back in the city this week.

“This city has an amazing pool of talent, as universities like UCT and Stellenbosch produce some of the finest engineering students on the continent. That is the main criterion for choosing our development centres, so Cape Town ticked the boxes.”

Narin says that Johannesburg, which opened its Amazon Web Services office last year, is “the economic heart of the country and the continent too, so it made sense to have our customer-facing presence there”.
Narin says the company’s successes in South Africa included Entersekt, Travelstart, and Medscheme.

Stellenbosch-based Entersekt developed South Africa’s first security solutions for mobile banking, resulting in a decline in credit card fraud.

Travelstart, an online booking service for flights and hotels, “shows how you go beyond the normal borders with cloud computing. It is now present in all of southern Africa and the Middle East”.

Medscheme uses cloud computing to keep patient records, making them “more accessible to medical service providers”.

Narin says South Africa was a “highly innovative and creative space for start-ups”.

By Tanya Farber for www.timeslive.co.za

Barclays puts Absa up for sale

UK banking group Barclays Group has made firm its intention to sell its 62,3% stake in Barclays Africa Group (formerly Absa).

The global banker listed as part of its rationale for the sell-down that, despite a strong returns profile locally, Absa’s contribution is significantly diluted at Barclays Group level.

The bank also carries 100% responsibility with only 623% benefits, it said at its results presentation.

Barclays said the sell-down will lead to further simplification of the group, resulting in cost reductions.

Barclays said it intends selling its African business over the coming two to three years “to a level which will permit us to deconsolidate it from an accounting and regulatory perspective”.

The intended sale is subject to shareholder and regulatory approvals.

Barclays Group said Absa is a well-diversified business and a high quality franchise.

“However the stake in BAGL presents specific challenges to Barclays as owners, such as the level of capital held in respect of BAGL, the international reach of the UK Bank Levy, the GSIB buffer, and MREL/TLAC and other regulatory requirements.”

Barclays Gropup Africa on Tuesday reported a 17% return on equity for 2015 in its standalone local currency results versus the 8,7% return reported for Africa Banking in Barclays’ results, the group said.

Source: www.fin24.com

E-commerce spending by South Africans via their mobile devices is set to grow by 70% in 2016, says a survey.

According to research organisation Ipsos, this figure is set to outpace overall e-commerce spend in SA which is forecast to grow by 29% this year.

E-commerce spending via mobiles accounted for 25% or R7-billion of all online transactions in 2015, says Efi Dahan, the Africa and Israel regional director for PayPal. Payment service PayPal commissioned the Ipsos survey.

The survey further reported that South African shoppers spent R28,8-billion online in 2015, which is expected to grow to R46-billion by 2017, of which mobile will account for R19-billion.

“There is no doubt that the rapid penetration of smartphones in South Africa will continue to be the driving force of online shopping in the upcoming years,” says Dahan.

Most South African online shoppers (59%) buy locally, with 37% buying both local and cross border and 5% buying exclusively from international providers.

The most popular online shopping destinations for locals are the US, UK and China, but Dahan warned that security was a challenge.

“I believe that the smartphone shopping experience will continue to evolve as consumers feel greater comfort and security.”

Security firm Trend Micro recently reported that hacked PayPal accounts with a guaranteed balance of $500 (R7 941.54) were traded for $6.43 (R102.51) on the Deep Web.

And Check Point reported that giant e-commerce platform eBay had failed to fix a security flaw dubbed “JSF**k” that allows cyber-crooks to use the platform as a phishing and malware distribution platform.

Dahan says that the online space made geographical borders irrelevant.

“Though international shopping is still less popular locally, with the growing variety of products, larger range of prices, improved shipping options and increasing confidence in e-commerce, we believe that South African consumers will continue to purchase online, regardless of physical borders.”

PayPal is the most popular online payment method for South Africans who shop internationally at 68%, followed by Visa Credit card at 37%, the survey showed.

By Duncan Alfreds for Fin24

Follow us on social media: 

               

View our magazine archives: 

                       


My Office News Ⓒ 2017 - Designed by A Collective


SUBSCRIBE TO OUR NEWSLETTER
Top