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Top facts about compliance and COVID-19

Staying on top of the compliance game can be tricky in this current environment and despite the obvious challenges, companies are still required to comply with BBBEE regulations.

  • Learners can be contracted in this measurement period, but train later

Spend on training for learners is still a requirement with agreements taking place for companies to either train online while strict social distancing is in place, or train in a blended/face-to-face scenario post-lockdown. The advantage of this is that you’re able to book training now which can be used in this period’s measurement, and only train learners later. We’re running a discounted offer in June that you can take advantage of, see below for more. *

  • Companies may need to adjust their annual BBBEE plans and targets

Owing to the fact that companies have mostly not been able to conduct their planned training, adjustments may need to be made to their BBBEE targets.

  • There will be no relaxation on BBBEE codes despite COVID-19

Absolutely no exemption has been made for the implementation or compliance to the BBBEE regulations and companies are expected to continue implementing measures to address their compliance targets.

  • Solidarity fund contributions cannot be claimed for BBBEE points

The Solidarity Fund was established to help those companies in need during the COVID-19 pandemic and contributions made cannot be claimed for BBBEE purposes such as SED or Skills development spend.

  • Proper recruitment is vital in order to claim for absorption

Online recruitment systems and partnerships (such as the partnership Summit has with Giraffe) can help companies to recruit quality candidates without actually meeting them in person. This is vital because 5% of unemployed learnership graduates need to be absorbed into an organization as a permanent employee, in order to qualify for the five points.

  • The 6% leviable amount for skills development will decrease

The 6% leviable amount for spend on skills development will decrease as companies reduce salaries, tax spend and headcount. This means that targets for spend on accredited training will be lower.

  • Less discretionary grant funding will be available from the SETAs

Less grant funding from SETAs will become a norm that companies will have to become used to as they reprioritise spending in the midst of COVID.

  • Online learning will become pivotal

It’s clear – social distancing will not be a temporary measure. Instead, companies will be required to continue complying with the distancing requirements for some time to come and as a result, online training will become a compliance imperative as companies continue to meet their training targets.

  • Due to the tax holiday, 20% mandatory grant refunds will be reduced

Quarterly grant refunds will be affected by the reduced tax income to SETAs.

  • There is a four-month tax holiday on payment of skills development levies

The 4-month tax holiday is a welcome relief, but it will reduce organisational budgets for skills development and the need will arise for adjustments for spending on training and bursaries.

*Summit is offering a 15% discount on training that’s paid in June for groups of 12 or more people. In other words, you can book now and train later while using this to comply with the current measurement period in terms of BBBEE requirements.

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