The Skills Development Act was developed in South Africa to address skills shortages among unemployed people that resulted from apartheid. It aims to develop skills of existing workers and improve business competitiveness. Key aspects of the Act include skills levies paid by companies to fund training through Sector Education and Training Authorities, learnerships to provide workplace training, and a framework for qualifications. The Act seeks to improve productivity while giving workers access to skills development.

1. IMPACT OF RECENT
LEGISLATION ON BUSINESS
SKILLS DEVELOPMENT ACT

2. NATURE OF THE SKILLS DEVELOPMENT ACT
(BACKGROUND)
• DEVELOPED IN RESPONSE TO THE DEMAND FOR REDRESS AND EQUITY IN
RELATION TO IMBALANCES CREATED BY THE APARTHEID.
• CAME INTO BEING TO DEAL WITH THE LACK OF SKILLS AMONGST THE
UNEMPLOYED PEOPLE THAT MADE IT HARD FOR THEM TO GET EMPLOYMENT.
• IT IS AN INTEGRAL PART OF THE NATIONAL SKILLS DEVELOPMENT STRATEGY
THAT AIMS TO: -DEVELOP SKILLS OF EXISTING WORKERS
- ENABLE EMPLOYERS TO BECOME MORE PRODUCTIVE AND
COMPETITIVE

3. PURPOSE OF THE SDA
• TO DEVELOP THE SKILLS OF PEOPLE IN SA IN ORDER TO IMPROVE PRODUCTIVITY
• TO ENCOURAGE BUSINESSES TO IMPROVE THE SKILLS OF THEIR WORKERS
• TO IMPROVE THE CHANCES OF GETTING A JOB FOR PREVIOUSLY
DISADVANTAGED PEOPLE
• TO REDRESS THE DISADVANTAGES THROUGH EDUCATION AND TRAINING

4. THE NATIONAL SKILLS DEVELOPMENT
STRATEGY
• A FRAMEWORK FOR SKILLS IMPROVEMENT DRAWN TO:
- PROVIDE FOR THE PARTICIPATION OF THE GOVERNMENT, ORGANISED BUSINESS
AND ORGANISED LABOUR.
- ENCOURAGE GOOD QUALITY TRAINING IN THE WORKPLACE
- INDICATE HOW SECTOR EDUCATION TRAINING AUTHORITIES (SETAS) SHOULD
USE THE MONEY ALLOCATED FOR SKILLS DEVELOPMENT LEVY.

5. THE NATIONAL SKILLS AUTHORITY (NSA)
• GOVERNMENT, TRADE UNIONS AND EMPLOYER ORGANISATIONS WORK TOGETHER TO
DEVELOP STRATEGIES TO FOLLOW WHEN EMPOWERING PEOPLE WITH SKILLS.
• ROLE: TO ADVISE THE MINISTER OF LABOUR ON THE FORMULATION OF NATIONAL STRATEGY
AND POLICY AND ON THE IMPLEMENTATION AND ALLOCATION OF SUBSIDIES FROM THE
NATIONAL SKILLS FUND.
• SECTOR EDUCATION TRAINING AUTHORITY (SETA): AN ORGANISATION THAT PROVIDES AND
PROMOTES THE EDUCATION AND TRAINING NEEDS OF THE EMPLOYERS AND EMPLOYEES. E.G.
AGRISETA, FOODBEV SETA
• DEVELOP SKILLS IN LINE WITH THE NATIONAL SKILLS DEVELOPMENT STRATEGY
• PROMOTE AND ESTABLISH LEARNERSHIPS

6. SKILLS DEVELOPMENT LEVY
• INTRODUCED IN 1999 TO ENSURE THAT PRIVATE COMPANIES CONTRIBUTE TO THE DEVELOPMENT
OF SKILLS IN SA.
• IT IS A LEVY PAID TO SARS FOR THE PURPOSE OF FINANCING THE SKILLS DEVELOPMENT STRATEGY
• A COMPANY MAKING MORE THAN R500 000 PER YEAR PAYS 1% OF THEIR EMPLOYEE'S
REMUNERATION (SALARY OR WAGES)
• 20 % GOES TO THE NATIONAL SKILLS FUND
• 10% USED FOR ORGANISATIONAL EXPENSES OF THE SETA
• 50% RECEIVED GRANTS BY BUSINESSES FROM THE SETA FOR PRODUCING WORKPLACE SKILLS PLANS
AND IMPLEMENTATION REPORTS
• NB: THE SETA ALSO RESPONSIBLE FOR PROVIDING LEARNERSHIPS AND OTHER SKILLS (20%)

7. CALCULATIONS
• ADD ALL THE SALARIES OF THE EMPLOYEES
• TAKE THE TOTAL AND DIVIDE IT WITH THE 1%
• THE NATIONAL QUALIFICATIONS FRAMEWORK (NQF)
• A FRAMEWORK THAT CLASSIFIES THE LEVELS OF OCCUPATIONAL
QUALIFICATIONS
• DESIGNED SO THAT PEOPLE CAN CHOOSE FORM VARIOUS OPTIONS HOW THEY
QUALIFY FOR A CAREER, AND ALSO CARRY TRAINING AND EXPERIENCE OVER
THOSE QUALIFICATIONS
• GIVES PEOPLE A CHANCE TO OBTAIN RECOGNISED QUALIFICATIONS IN
EDUCATION AND EMPLOYMENT.

8. LEARNERSHIPS
• THEORETICAL AND PRACTICAL TRAINING OPPORTUNITIES THAT CAN LEAD TO A
RECOGNISED OCCUPATIONAL QUALIFICATION

9. ADVANTAGES AND DISADVANTAGES OF SDA
ADVANTAGES
• IMPROVEMENT IN PRODUCTIVITY IN
THE WORKPLACE
• IMPROVEMENT IN THE QUALITY OF LIFE
OF WORKERS
• ENCOURAGES ONGOING SKILLS AND
DEVELOPMENT, LEARNING AND THE
ACQUISITION OF NEW SKILLS AND
WORK EXPERIENCE
DISADVANTAGES
• IS A BUREAUCRATIC (LONG
PROCEDURES) AND REQUIRES LARGE
AMOUNT OF PAPERWORK AND
ADMINISTRATION.
• LAWS AND ACTS SUCH AS THESE ARE
VERY DIFFICULT TO MONITOR AND
CONTROL.

10. RIGHTS OF THE BUSINESS AND EMPLOYEES
BUSINESS
• THE RIGHT TO EXPECT A BETTER
SKILLED WORKFORCE AND HIGHER
PRODUCTIVITY FROM EMPLOYEES.
EMPLOYEES
• WORKERS HAVE THE RIGHT TO
ACQUIRE SKILLS AND TRAINING IN
THE WORKPLACE TO ENSURE
GREATER PARTICIPATION IN THE
ECONOMY

11. COMPLIANCE AND PENALTIES IF THE
BUSINESS DOES NOT COMPLY (OBEY)
• BUSINESS SHOULD REGISTER WITH SARS
• BUSINESSES THAT DO NOT PAY THE PRESCRIBED RATES ARE RELIABLE FOR
PENALTIES
• LATE PENALTY = 10 % OF THE AMOUNT
• SERIOUS PENALTY = LEGAL ACTION
• COMPANIES NOT PAYING THE SKILLS DEVELOPMENT LEVY MAY NOT OFFER
LEARNERSHIPS OR CLAIM FOR GRANTS FROM THE SDFUND
• PAYMENTS AND PENALTIES ARE MONITORED BY SARS

12. ACTIONS REGARDED AS DISCRIMINATORY OR
FRAUDULENT IN THE SDA
• EMPLOYEES BEING DENIED APPROPRIATE SKILLS AND DEVELOPMENT
OPPORTUNITIES BECAUSE OF THEIR RACE, GENDER OR DISABILITY
• EMPLOYERS PROMOTING SKILLS AND DEVELOPMENT UNFAIRLY
• EMPLOYERS PROVIDING EMPLOYMENT SERVICES FOR GAIN WITHOUT BEING
REGISTERED AS AN EMPLOYER