Arrest the income gap bandit

Take a holistic approach to measuring income inequality.

Income inequality is still the elephant in the room. It is by far the biggest time bandit on Remuneration committees today and will continue to be for the foreseeable future.

The South African economy has historically been afflicted by income and wealth inequality. Given the income inequality and socioeconomic conditions in South Africa, it is not surprising that income inequality within companies has been the topic of much debate. The instrument most commonly used when measuring income inequality within a company is the Wage Gap.

There are many different angles to the wage gap and many different methods of calculating it. The aim of this article is to demystify these angles and methods, outlining the key features of each, and provide discussion to assist with the selection of the most appropriate measure.

Wage Gap

Although there have been a number of different methodologies used to calculate a “Wage Gap”, the methodology used by the United States Securities Exchange Commission is calculated as:

Wage gap calculated by USSEC

A, B and C band employees covers unskilled, semi-skilled (operational) and skilled (advanced operational) – stopping just short of managers and known collectively as the general workforce. This calculation provides the user with the ratio of how many times higher the CEO’s pay is than the median worker’s pay. The benefit of using this methodology is that it is simple to compute and easily understood. There are however weaknesses in the Wage Gap methodology, which include:

By simply halving the CEO’s pay, the ratio will halve even if there has been no gain to the worker’s welfare; and
The grade of the “median employee” is unknown and therefore an organisation with a high number of lower level employees is more likely to have a higher wage gap.

There are a number of measures of income inequality which can be calculated, all with their own benefits and limitations.

10 -10 Ratio

The 10-10 Ratio is often used as a crude measure of inequality within macroeconomics when all the data needed in order to calculate a Gini Coefficient is not available.

Calculate a Gini Coefficient

The benefits of this methodology include:

– It’s easy to calculate; and
– It’s more inclusive than the standard Wage Gap in terms of how the numerator is calculated.

The disadvantage:

– It doesn’t provide information regarding the other 80% of the sample.

Gini Coefficient

This measure is traditionally used in macroeconomics and measures the inequality within a distribution. In layman’s terms, it measures the area between the “Line of Equality” (when everyone earns exactly the same) and the Lorenz Curve which is the cumulative distribution of all incomes in the sample, ranked from lowest to highest. The greater the distance (area) between the Line of Equality and the Lorenz Curve, the more unequal the income distribution is.

The Line of Equality and the Lorenz Curve

Benefits include:

– It makes use of the entire population.

Associated weaknesses are:

– A small sample may result in biased results;
– It can be computationally difficult to calculate;
– It does not provide a measure of inequality within sub-sections of the population; and
– It counts the unemployed in the calculation, which is one of the reasons the Gini coefficient is so high in South Africa.

Coefficient of Variation

The Coefficient of Variation provides a measure of inequality between sub-sections. In statistics, it is defined as a normalised measure of dispersion within a sample and is calculated as:

The Coefficient of Variation

Benefits include:

– It can be used to calculate inequality within each grade or other sub samples;
– It can be used to measure macro and micro levels of inequality; and
– It is easier to calculate than other methodologies which analyse inequality within sub-samples.

The disadvantages are:

– A large enough sample within each sub-sample is required; and
– If the distribution of the data is far from a normal distribution, it can produce biased results.

The Coefficient of Variation has the potential to provide the most holistic view of income inequality of all the measures discussed. It is clear that each of these methodologies has its own strengths and weaknesses and, as a result, a “multi-measure” rather than a “single measure” approach is required in order to obtain a holistic view of income inequality.

Conclusion

The Wage Gap provides a good starting point for addressing income inequality within an organisation but it does not provide a holistic view. Several alternative measures of income inequality have been discussed, each with its own strengths and weaknesses – none of which can provide an accurate holistic view in isolation. This leads one to conclude that in order to obtain a holistic view of income inequality within an organisation, a number of inequality measures should be used in conjunction in order to obtain the true picture of income inequality.

To fix this is not easy. If one halved the CEO’s pay of every single company and distributed it to the works, they would each get only a few Rand each. We need to think about structural methods to address this, one of which is to give employees shares in the companies they work for. However, the government and DTI need to assist companies to spread the wealth and companies should be given tax incentives to do so.

Bryden Morton has a B.Com (Hons) Economics and is a Data Manager at 21st Century Pay Solutions Group and Chris Blair is the CEO of 21st Century Pay Solutions Group, www.21century.co.za. Chris has a B.Sc in Chemical Engineering. Dr Mark Bussin is the Executive Chairperson at 21st Century Pay Solutions Group, a Professor at University of Johannesburg, Professor Extraordinaire at North West University, Chairperson and member of various boards and remuneration committees, immediate past President and EXCO member of South African Reward Association, and a former Commissioner in the Office of the Presidency.

This article appeared in the July 2015 issue of HR Future magazine.

Fair does not necessarily mean equal

A one-size-fits-all policy is not the answer when it comes to developing female leaders.

In aviation, ‘service ceiling’ is used to describe the maximum altitude at which an aircraft can effectively operate. Above that, it can hardly climb, glacially edging upwards towards the point it can go no higher, the absolute ceiling.

The same phenomenon exists with regard to women’s careers, known as the ‘glass celling’, an invisible and subtle, yet unbreakable, barrier where the next level of career advancement can be seen but cannot be reached.

Is this intentional? I very much doubt it. Certainly British Airways have worked hard to raise the number of women pilots they have, with limited success, as have engineering, consulting, manufacturing and service companies. Recently, more nuanced views have arrived to help reflect on the relative lack of women in boardrooms and senior management. In 2012 research by EY with 1000 women leaders in the UK, four barriers emerged. They are age, lack of role models, motherhood, qualifications and experience.

For women pilots, just one of these, motherhood, has deep challenges for career continuity. A pilot, to progress, needs to build flying hours, to have current experience, to maintain high skill levels and to stay on the seniority ladder. Often a significant part of their salary is flying pay.

When pregnant, a woman must stop flying for at least part of her pregnancy. Then she will take maternity leave. In the UK, statutory maternity leave is six months and it can be up to a year. Depending on the airline, she may lose flying pay – in some countries, such as India, up to 75% of pay may be lost. And during this absence, no flying hours are built up, skills and flying currency is lost, and there is a good chance of slipping back on the career ladder and losing the chance of becoming a captain.

As if this were not challenge enough, EY says that the barriers can be experienced at any time and often together. Whilst the barriers clearly aren’t exclusive to women, the research showed that employers need to do a lot more to help women in particular overcome them. It’s not so much any particular person’s attitude where the problem lies, it’s more in the implicit structures, practices and assumptions in our organisations.

One of the killer assumptions is that fair means equal. We differ, in our personalities, in our gender and in what that brings, so a one-size-fits-all policy doesn’t necessarily cut it. Maria Miller, when minister for women and equalities in the UK, said, “It goes without saying that men and women are different. The workplace was designed by men for men but times have changed and, if we want women to be able to fulfil their potential, we need to modernise the workplace.”

Helena Morrissey, CEO of Newton Investment Management, said, “Men and women are different – equally intelligent but we behave differently and are motivated by different things.” Ignoring these differences can be plain insensitive and poor talent management.

But what about women pilots? Female pilot, Mireille Goyer, writing in AvWeb said, “Like I did, I bet that many little girls dream about flying like a bird. But, I would also bet that most do not dream of growing up to do a job that requires them to dress in men’s clothing complete with a straight-cut jacket, a cap designed to enhance male facial traits and a black tie. Given a choice, I suspect most little boys would not dream of doing a job that required them to wear women’s clothing on a daily basis either.”

How different is this to how women are treated in another traditionally male sector, the motorcycle industry? Goyer goes on to describe how Harley Davidson reserves an entire section of their website for women riders with subsections such as riding courses, mentoring, the right bike, and, yes, riding gear and apparel. And it was good business practice. From 2003 to 2008, Harley Davidson saw a whopping 29 per cent increase in the number of female motorcycle owners.

Communication is an endless challenge too. For example, gender patterns in talking vary hugely, even without taking into account intercultural differences. I’m paraphrasing Mary Turny and Ruth Sitler here – they wrote about Professor Deborah Frances Tannen, a world-leading researcher on speech patterns in gender. Tannen spoke to female surgeons. One such surgeon said, “I first modelled my behaviour on male surgeons. The operating room functioned like the military with the surgeon barking orders. I found that it didn’t work for me. Rather, by allying myself with nurses and respecting them as professional colleagues, they became my best allies”.

Tannen concluded that men can be authoritarian without loss of service support, but women cannot operate in the same way.

According to Sitler, ‘It seems we can learn though. Flight crew language was found to operate on both a propositional level (what is said) and a relational level (what it implies about the speaker’s relationships). The most effective crews attend to the relational level. This means that by using direct, but courteous language crew coordination improves. Awareness of power displays is important. Pilot-in-command responsibilities must never be given up in the face of loud or aggressive language. Courteous, thoughtful responses and consistent respect are most successful communication tools for a crew.

Women’s tendency to check and re-check information and to ask questions is useful in error management. We have found that instructor pilots need to adjust to meet women’s needs for more thorough understanding. Instructors should frequently ask women students if they understand a concept or manoeuvre. The answers will usually be candid, while male students will nearly always respond that they understand whether or not they do indeed understand.”

All this seems remarkably true of the boardroom and the general world of work too. The aim of a gender-friendly board and of intelligent, different individuals thinking intelligently together is certainly worth shooting for!

Jon Foster-Pedley is the Dean of Henley Business School, Africa, www.henleysa.ac.za. He is a former airline captain, and was a flying instructor and aerobatics pilot for 15 years as well as a senior executive in the European aerospace industry.

This article appeared in the July 2015 issue of HR Future magazine.

Create the companies of tomorrow

An integrated and systemic approach to learning and development will give you outstanding results.

Crucial to the ability of today’s organisations to thrive and excel in tomorrow’s world is their capacity to be continually learning and adapting rapidly.

This implies that all the different stakeholder groups have an important part to play. Whilst this might seem anidealistic notion to some, the fact is that, internationally, organisations which have adopted an integrated and systemic approach to learning and development are seeing exceptional results.

Peter Hawkins, Professor of Leadership at Henley Business School in the United Kingdom points outthat ” the world has moved beyond the time when major challenges could be met by the great individual leader (CEO) – Human beings have created a world of such complexity and global interdependence, and of continuous, fast-moving and volatile change, that leadership is beyond the scope of any individual (no matter how competent), and requires more effective collective leadership and high-performing leadership teams.”*

Some of the key themes experienced by a significant number of executive leadership teams include:

• Managing the expectations of all the different stakeholders, including regulators, board members, shareholders, key clients, partner organisations and, not least of all, their own divisions and functions;

• Leadership teams have to run and transform the business and its wider system, in parallel. This requires the process of collectively engaging the commitment and participation of all major stakeholder groups to radical change in the context of shared endeavour, values and vision;

• Teams need to increase their collective capacity for working through systemic conflict;

• Leaders have to live with multiple memberships and belonging. Rarely do senior leaders at this time belong to just one team. It is often psychologically difficult to commit equally to two or more teams;

• The world is becoming more complex and interconnected. We live in a world where it is increasingly harder to get the distance necessary to stand back, reflect, and see the bigger picture;

Virtual working has grown. The global working day operates 24/7 as activity moves to different parts of the globe as the day progresses. Communication is often electronic, which requires new communication skills and new ways of establishing and sustaining trust;

• Trust needs to be restored. Trust in organisations is at an all-time low, and so is the trust in the collective leadership by their employees;

• The major leadership challenges lie not in the parts, but in the connections between the parts – the interfaces between people, teams, functions, and different stakeholder needs;

• Increasing the quality of engagement. Executive leadership needs to be extremely effective in constantly engaging their direct reports (managers), employees, customers, the Board, regulators, unions, and other relevant critical stakeholders; and

• Leaders have to talk to all of their people, all the time, and all need to be saying and acting according to the same message. This requires a strategic narrative, engaged managers, listening to the employee voice and organisational integrity – clear and consistent alignment between what is said (values) and what is done.

Starting at the top, it is essential to the success of any system-wide learning change initiative that the organisation’s leaders are seen to take the lead in continually fostering their own collective and individual learning and improvement. How to transform organisations into adaptable, change-able learning systems, accountable, resilient and ready for tomorrow’s world, will be the focus of the next set of articles in this series.

Barbara Walsh is an executive coach and coaching consultant with Metaco, www.metaco.co.za. She has an MSc in Coaching and Behavioural Change from Henley Business School in the UK, and is an accredited Neuro-Semantics Meta-Coach and Coach Trainer.

Reference
*Peter Hawkins: Leadership Team Coaching: Developing Collective Transformational Leadership, 2014.

This article appeared in the July 2015 issue of HR Future magazine.

5 trends that will transform HR technology

HR executives need to get ready to manage these coming trends.

Over the past decade, we have seen how important technology has become in the space of HR, not only as a tool to capture, manipulate and analyse data but, more importantly, how HR technology has been instrumental in transforming the field of HR, and how changes on the near horizon have the potential for an even greater impact in the future.

In conducting my research, I came across some very interesting facts published by the Society for Human Resource Management Foundation (SHRM) regarding their predictions on what trends will transform HR technology. Although this research was not specifically mentioned with South Africa in mind, I found it comforting to see how closely we in South Africa are aligned to what is happening worldwide with regards to HR systems. According to the SHRM Foundation paper entitled Leveraging HR Technology for Competitive Advantage, the top five trends we can expect to impact our HR systems are:

Trend 1: Growth of social networking

One of the next challenges for HR executives is learning to integrate information from social networking sites. Potential benefits exist alongside problems of privacy and data accuracy. Challenges are evolving as new legislation and applications develop.

Trend 2: Expansion of compliance and reporting requirements

Organisations will increasingly need to adapt their HRIS in order to remain compliant with legislative requirements. Pending changes in tax codes, financial reports, EE compliance and Skills Development compliance all suggest that compliance and reporting demands will increase.

Trend 3: More renting, less buying of services

The use of hosted approaches, in which organisations rent services and software from vendors is booming in both America and Europe, with this trend sure to start picking up traction in South Africa in the near future. The growth of the Internet and web-based systems has enabled organisations to consider approaches such as cloud computing and software-as-a-service (SaaS). Such approaches can provide benefits, especially for smaller organisations that would like to access the capabilities of complex HR systems but are unable to afford a large system. Cloud computing and SaaS are likely to grow in market share and will provide added flexibility to organisations’ HRIS strategies.

Trend 4: Greater use of Business Intelligence (BI) and dashboards

One of the key challenges for HR professionals is how to turn HR data into a form that managers can use to measure HR’s contributions to organisational profitability. To address this problem, organisations will begin to use more sophisticated BI applications to analyse the large amount of data available through HRIS. HR dashboards are able to present high-level, real-time, graphically formatted data to executives and managers, and will become an integral part of the human capital management. In addition, firms will adopt more sophisticated web-based workforce analytic tools and will push data farther out to managers. This will enable managers to use the organisation’s personnel policies and practices to make better employee-related decisions.

Trend 5: Increasing HR data transparency, increasing privacy concerns

As noted above, HRIS can make increasing amounts of HR data more accessible to employees, along with more transparent policies and procedures. But with greater transparency comes greater concerns about privacy. News reports of data compromises and identity theft surface almost daily, and few entities manage more personal information than employers. As employers make data easier to access, risks of jeopardising employees’ privacy increase. Managing this risk is becoming even more complex as HR applications often link to systems outside the organisation (such as benefits vendors, online job search sites, distance learning providers).

In conclusion

Human Resource information systems have dramatically altered how HR services are delivered and managed by organisations. Used effectively, these systems make the HR function more efficient, better informed and better able to accurately communicate how it adds value to the organisation. However, to reap the full benefits of implementation, HR executives must combine the best of HR technology with effective HR management processes, and they must be ready to manage the challenges created.

Rob Bothma is an HR Systems Industry Specialist at NGA Africa, a non-executive director, Fellow and Vice President of the Institute of People Management and co-author of the 4th Edition of Contemporary Issues in HRM and member of the Executive Board for HR Pulse.

Source
Leveraging HR Technology for Competitive Advantage, SHRM Foundation.

This article appeared in the July 2015 issue of HR Future magazine.

Leadership is not all about achievement

Manage the impact of achievement drive on leadership effectiveness.

When you think about individuals with the need to achieve, who set challenging goals, raise the bar, improve standards – it all sounds like very desirable behaviour that could do nothing but good for a company’s performance.

In fact, we tend to promote those who exhibit this type of behaviour the most, and we normally give them the biggest bonuses and corporate prizes available to us with the intent of reinforcing the pattern of behaviour. This is very valid for instances when an individual’s job performance is linked to doing everything by themselves and their contribution to the organisation is an ‘individual’ contribution. Most organisations tend to promote these individuals to positions where, unfortunately, the ingredients that made them successful as individual contributors are almost in contradiction to what is needed to perform when the need is actually to deliver through others.

David McClelland, who had a major impact in allowing us to understand human motivation half a decade ago, differentiated between three types of motives which impact our behaviour. He called these the three social motives and labelled them Achievement, Affiliation and Power. Achievement refers to the need for setting high standards and goals, surpassing one’s previous performance and also being better than the ones we believe represent a standard of excellence. Achievement is a need that can easily be fulfilled by oneself and through one’ own actions. It doesn’t require an audience – except for when it comes to providing feedback, recognition and acknowledgement of what has actually being achieved.

So we normally find a group of leaders who have worked their way up the corporate ranks, most probably because of their Achievement need or drive. Their primary need for Achievement has not gone away just because they are now in a leadership position, which makes one think: what is the impact of this need in leadership performance and how does it translate into behaviour?

One of the characteristics of leaders with a high need for Achievement is that they will raise the bar – again and again and again. They can easily lose sight of whether individuals are ready for further change, if the standard is in line with people’s capabilities or just considering – in general – the impact that it has on individuals’ motivation and engagement.

Another way in which the Achievement need can impact behaviour is when people in leadership roles become apprehensive of delegating. Most opportunities for delegating seem more like an opportunity for something to go wrong. Even when there is an attempt at delegating, if the leader even slightly perceives that this will not be done to the highest standard, he or she will jump in and “rescue” the situation. This normally leaves team members with a high degree of uncertainty, wondering what is their accountability and what isn’t – because it seems that their portfolio can and will be interfered with at any given time.

There is also the risk of setting goals and standards that don’t have a close relationship with reality. Unachievable goals, far from motivating people, create a sense of helplessness where it doesn’t matter what one does or not – failure will take place anyway.

Now this is not to say that individuals with a high need for Achievement should never be promoted to leadership positions. Organisations just need to be more conscious of the personal characteristics that have allowed individuals to succeed in their individual contributor roles, and analyse the impact of such traits for the leadership role – both positive consequences and risks for the business.

Individuals in leadership positions don’t need to “lose” their Achievement drive but they need to be clear about their personal and natural desire for going higher, bigger and wider so that they can temper this with a concern for the impact of decisions on people, and ultimately the organisation as a whole.

Organisations would also be able to counter some of these risks if they put specific developmental efforts into allowing people to transition from one role to the next more effectively. Some of the most successful companies allow individual contributors to have a ‘taste’ of what a leadership role entails. This normally means being provided with an assignment where the future leader is expected to manage, coordinate and control other people’s performance. Further to the experience, the individual can reflect how much this is in line with one’s own aspirations, but the future leader can also receive valuable feedback from others to work on any leadership effectiveness gaps before being appointed to a role where it will matter.

When it comes to selecting individuals for leadership roles, the Achievement drive is something to value, but it is important to determine if the individual in question possesses other characteristics that will counter and balance the behaviours associated with a high need for Achievement. For example, is the individual also driven by Affiliation (the need for establishing and maintaining nurturing relationships) or even Power (the need to have an impact and influence in others)? One can also look at what the individual values – how important is it for individuals to perform through and with others? Even when this might not come naturally to them.

So, in the end, it’s about balance. High levels of achievement are needed, but other traits should create a well-balanced performance whereby leaders can demonstrate and adapt the leadership behaviour to what the situation calls for. And organisations can do a lot more to help individuals adapt to their roles more effectively.

Agustina Mendez is the Leadership and Talent Practice Head at Hay Group South Africa, www.haygroup.com/za.

This article appeared in the July 2015 issue of HR Future magazine.

Be an inclusive thinker

Overcome your fear of “other” and you will be a more insightful and effective leader.

Our ability to deal effectively with the different situations we face in life depends on the degree to which we are able to appreciate and comprehend the full picture.

It helps us find the most effective response, and we experience life in a richer and more fulfilling way, if we can broaden our insight with a sincere mind and heart. To grow a fuller and richer appreciation and understanding of the problems or challenges we encounter, particularly where people are involved, we have to open our minds, hearts, and most difficult of all, our will.

Look outside in and bottom up As Richard Rohr says, we are much more likely to find the truth at the bottom and the edges of things (of the social/political/economic structure) than at the top or the centre. In terms of the state, government would be at the top and the elite or upper class in the centre. Don’t expect them to give you the ugly truth. Xenophobia, a worldwide phenomena, can be defined as “the unreasoned fear of that which is perceived to be foreign or strange – it can involve the relations and perceptions of an ingroup towards an outgroup”. The poor, the foreigner, the outgroup, the dropout, the homosexual and the disabled, looking from the outside in, will have a more accurate view of the degree to which the country’s constitution is practised than would the rest of us. Wise leaders should therefore do their utmost and the counterintuitive to stay in touch with the marginalised – including saying, “No,” to the temptations of self-enrichment and abuse of power.

Similarly, wise organisational leaders would deliberately acquaint themselves with the experiences of employees from the bottom up, and the experiences of customers from the outside in. Notwithstanding their busy schedules and having to absorb the latest market indicators, they will consider the frustrations, disillusionment and anger of employees and customers complaining about the lack of freedom and self-expression or poor service from poorly trained and disempowered frontline people. Instead of lying awake thinking of their next strategic move, they should lie awake thinking how to lead more inclusively, empowering more people throughout their organisations.

Overcome your fears Inclusive thinking works both ways. As much as we may want to side with one group of people, the challenge of inclusive thinking is to sincerely want to grow a better understanding of those we find most difficult to associate with. The responsibility rests on each of us to bridge the divide that exists – whether we are in the middle or on the edges, inside or outside.

When we look deeper, and with brutal honesty, into the reason for our “natural” preference to attack or ignore the “other”, we discover that the negative feelings we have about “them” are not independent of our own fears and self-doubts. In fact, we are projecting our fears and doubts on them. We fear interacting with poor people because we are afraid of not being successful. We are frightened by the homeless because we fear being homeless ourselves. And we create a distance between ourselves and those who, by their mere existence, evoke the fears we have within but try to suppress or deny as a potential weakness or imperfection. It is hard to face the truth that all suppressed parts of ourselves will revolt and weaken us at some point, as individuals as well as societies.

We are all, some way or another, prisoners of our own fears. Our challenge is to recognise our fears in the “other” and overcome them in ourselves. By making peace with our own imperfections and shadows and accepting forgiveness and grace for our lives, our thinking and acting will become more inclusive and our lives richer and more fulfilling.

Dr Gerhard van Rensburg is a Leadership Coach, www.newlead.co.za, and author of The Leadership Challenge in Africa and Leadership Thoughts.

This article appeared in the July 2015 issue of HR Future magazine.

Who resolves breach disputes?

Labour court rules that the bargaining council has jurisdiction to entertain a dispute.

The labour court, in PSA (obo L Liebenberg) v Department of Defence, Public Service Co- Ordinating Bargaining Council and Maritz NO (2013) 24 SALLR 82 (LC), had the opportunity of considering the following important issues:

(a) In a scenario where there is a collective agreement regulating a matter such as the granting of temporary incapacity leave and an employee is dissatisfied with an employer’s refusal to grant such leave in terms of the said collective agreement, is such dispute to be resolved in terms of section 24 of the LRA so dealing with the interpretation or application of such collective agreement?

Overview

This review application is unusual in the sense that the parties agree that the arbitrator’s ruling is not sustainable and should be reviewed, set aside and substituted. However, they differ as to the nature of the substituted order.

The dispute turns on the question as to whether or not the second respondent (the bargaining council) had jurisdiction to entertain the dispute that the applicant referred.

That question, in turn, depends on the question whether the dispute can properly be categorised as a dispute over the application of a collective agreement as envisaged in s24 of the Labour Relations Act 66 of 1995 (“the LRA”) or whether the true nature of the dispute is one for substantive relief in which the application of the agreement is merely a matter in the dispute.

Both parties seek to review and set aside a jurisdictional ruling by the arbitrator (the third respondent, Adv Bill Maritz) in which he held that the bargaining council did not have jurisdiction to entertain the dispute that the applicant (the PSA acting on behalf of its member, Ms L Liebenberg) had referred to it.

The PSA seeks a substituted ruling that the bargaining council does have jurisdiction. The first respondent, the Department of Defence (“the Department”), seeks a substituted ruling that the bargaining council does not have jurisdiction, but for different reasons from those advanced by the arbitrator.

Pertinent facts of the case Collective agreement The broader dispute between the parties turns on a collective agreement of the bargaining council, Resolution 7 of 2000 (“the resolution”). The resolution deals with temporary incapacity leave, commonly referred to as “‘TIL” by the parties. The parties have encountered a mutual problem whereby the Department is faced with a large number of applications for temporary incapacity leave from its employees.

Approach of PSA

Where members of the PSA, such as Ms Liebenberg, have been unsuccessful in their applications for TIL, the PSA has referred a dispute to the bargaining council in terms of s24 of the LRA as a dispute over the application of a collective agreement.

It is the union’s view that, where the Department fails to timeously assess and determine such applications, it amounts to a failure to apply the resolution and the bargaining council has jurisdiction to consider the dispute in terms of s24 of the LRA. Section 24(1) of the LRA provides that:

“Every collective agreement – must provide for a procedure to resolve any dispute about the interpretation or application of the collective agreement. The procedure must first require the parties to attempt to resolve the dispute through conciliation and, if the dispute remains unresolved, to resolve it through arbitration.”

Duties of the employer into the collective agreement

The resolution provides for the following process for TIL:

(a) An employee whose normal sick leave credits in the cycle have been exhausted and who, according to the relevant practitioner, requires to be absent from work due to disability which is not permanent, may be granted sick leave on full pay, provided that:
(i) her or his supervisor is informed that the employee is ill; and
(ii) a relevant registered medical and/or dental practitioner has duly certified such a condition in advance, as temporary disability, except where conditions do not allow.

(b) The employer shall, during 30 working days, investigate the extent of the inability to perform normal official duties, the degree of inability and the cause thereof. Investigations shall be in accordance with item 10 (1) of schedule 8 in the Labour Relations Act of 1995.

(c) The employer shall specify the level of approval in respect of applications for disability leave.” The parties are ad idem that the Department has to investigate and decide on an application for TIL within 30 days.

Particulars in casu

Ms Liebenberg exhausted her sick leave credits and applied for TIL in terms of the resolution. Her application was refused, but the Department only notified her of the refusal more than two and a half years after she applied (instead of 30 days). The PSA then referred a dispute to the bargaining council on her behalf.

Nature of the dispute referred to bargaining council

The nature of the dispute was described as the application of a collective agreement, that is, PSCBC Resolution 7 of 2000. The outcome required was that TIL be approved for the period of 5 to 7 November 2008.

Point in limine raised at arbitration

The Department raised a preliminary point that the bargaining council did not have jurisdiction to consider the dispute. Its argument was based on the decision of the labour appeal court in Minister of Safety and Security v SSSBC and Others (2010) 31 ILJ 1813 (LAC).

In short, the Department argued that the interpretation and application of the resolution was only an “issue in the dispute” and that the real dispute was whether it was fair for the Department to have refused Liebenberg’s TIL application.

Findings of the court

The real question for determination

The labour court indicated that the real question for determination is the true nature of the dispute; and the precedent established by the labour appeal court in SSSBC and other cases.

The labour court also agreed with both parties that there would be little point in remitting the jurisdictional question to the bargaining council and that the labour court is in a position to substitute its own decision for that of the arbitrator.

The labour court is bound by the principle of stare decisis and, thus, had to consider whether the SSSBC judgment is in point and whether the import of that decision is to oust the jurisdiction of the bargaining council on the facts before it in this dispute. Subsequent to the arbitration (and the filing of the parties’ heads of argument), though, the labour appeal court’s judgment in PSA obo De Bruyn v Minister of Safety and Security [2012] 9 BLLR 888 (LAC) was reported.

SSSBC judgment

In SSSBC, the employee applied for a transfer within the South African Police Services (“SAPS”) which was refused. He referred a dispute about the interpretation and application of a collective agreement dealing with SAPS’s transfer policy and procedures to the Safety and Security Sectoral Bargaining Council (“SSSBC”). He challenged the decision of SAPS to refuse his application for transfer.

The issue before the labour appeal court was whether the SSSBC had jurisdiction to deal with the dispute. That issue had to be determined by how the court answered the further question of whether or not the arbitrator correctly classified the dispute before him as one concerning the interpretation and application of a collective agreement.

It was accepted by both parties that, if the dispute was a dispute about the interpretation or application of a collective agreement, the SSSBC had jurisdiction in respect of the dispute but that, if the dispute was about the fairness of the transfer, the SSSBC did not have jurisdiction.

City Parks judgment

On the same day as it handed down judgment in SSSBC, the labour appeal court handed down judgment in Johannesburg City Parks v Mpahlani NO and Others (201) 3 ILJ 1804 (LAC). In City Parks, the court offered the already-mentioned explanation between “a dispute” and “an issue in a dispute”.

SA Onderwysersunie judgment The labour court applied similar reasoning in SA Onderwysersunie v Head of Department, Gauteng Department of Education and Others (1) (2011) 32 ILJ 1413 (LC), having referred to City Parks and SSSBC judgments, when it held:

“It appears to me that the main dispute in this urgent application is not the interpretation and application of a collective agreement. The relief sought is for the head of department to refund the money deducted from the applicants’ members pending the compilation of a factually correct database. In the course of deciding whether the applicants are entitled to the relief sought, I have to consider various undertakings by the GDE, some of which are contained in collective agreements of the PSCBC. Those agreements form part of the issues in dispute; but the main dispute is not the interpretation or application of a collective agreement.”

Arguments of the respective parties

The Department argues that the SSSBC judgment is directly in point of the case before the labour court. It argues that the dispute before commissioner Maritz was whether the Department’s refusal of Ms Liebenberg’s application for TIL was unfair. The provisions of the collective agreement only had to be interpreted and applied in deciding that dispute. Therefore, the Department argues, the bargaining council did not have jurisdiction.

The PSA has submitted that the dictum in SSSBC should be narrowly construed so as to avoid the situation where most disputes concerning the application of a collective agreement are rendered nugatory.

It submitted that the clear purpose of s24 is to resolve disputes where a party is in breach of a collective agreement by failing to apply its terms, either correctly or at all.

Even though the union would be limited to a finding by the arbitrator that the Department had breached (or failed to apply) the collective agreement and a declaratory order that the Department should comply or rectify its non-application, that should not deprive the bargaining council of jurisdiction altogether.

Gcaba judgment and similar case law

This line of argument appears to the labour court to be consistent with the approach of the constitutional court in Gcaba v Minister for Safety and Security (2010) 31 ILJ 296 (CC).

The constitutional court pointed out that what ultimately determined the jurisdictional divide was the manner in which the dispute was pleaded (that is, the cause of action relied upon) and the nature of the relief sought.

Jurisdiction is determined on the basis of the pleadings, as the constitutional court held in Chirwa v Transnet 2008 (4) SA 367 (CC); (2008) 29 ILJ 73 (CC), and not the substantive merits of the case. A similar point was made by Nugent JA in Makhanya v University of Zululand 2010 (1) SA 62 (SCA):

“[71] [T]he claim that is before a court is a matter of fact. When the claimant says that the claim arises from the infringement of the common law right to enforce a contract, then, that is the claim, as a fact, and the court must deal with it accordingly. When the claimant says that the claim is to enforce a right that is created by the LRA, then, that is the claim that the court has before it, as a fact. When he or she says that the claim is to enforce a right derived from the Constitution, then, as a fact, that is the claim. That the claim might be a bad claim is beside the point.

[95] We know this [that is, what the claim is] because that is what it says in the particulars of claim. Whether the claim is a good one or a bad one is immaterial. Nor may a court thwart the pursuit of the claim by denying access to a forum that has been provided by law.”

Application of the above principles to the facts in casu

In the present case, the applicants formulated the claim before the bargaining council as one concerning the application of Resolution 7 of 2000. If that was the true nature of the dispute, the bargaining council had jurisdiction to consider it. The judgments in City Parks and SSSBC must also be reconsidered in the light of the more recent decision of the labour appeal court in De Bruyn. It is the opinion of the court that the De Bruyn judgment is directly in point with the current one. The PSA also acted on behalf of its member, De Bruyn who applied for temporary incapacity leave. The employer approved TIL for one period and disapproved it for another period.

He referred an unfair labour practice dispute to the SSSBC. However, the dispute was not pursued and remained unresolved. The PSA then approached the labour court for the review and setting aside of the employer’s decision to disapprove the application for TIL in terms of s158(1)(h) of the LRA.

The labour court held that temporary incapacity leave is governed by the provisions of a resolution of the PSCBC which is a binding collective agreement. The appropriate forum to challenge the decision of the employer refusing the employee temporary incapacity leave, the court held, was the bargaining council. It also expressed the view that the cause of action for the applicant (the PSA on behalf of its member) rested in the application and/or interpretation of the provisions of the PSCBC resolution.

On appeal, Mlambo JP considered sections 158(1)(h) and 24 of the LRA and concluded: “[31] The appellant’s complaint clearly concerns the denial of incapacity leave. The alleged right the appellant seeks to assert derived from the provisions of the PSCBC resolution as the labour court, correctly in our view, found. The resolution deals with leave of absence and what steps an employee should take in case of a dispute arising regarding attendant matters. There is no doubt that the aspect of leave of absence is an issue falling squarely under the PSCBC resolution. In deciding whether the relief sought ought to be granted, the court a quo had to have regard to the provisions of the resolution.

[32] Therefore, the court a quo – correctly proceeded to consider whether the LRA required the kind of dispute which existed between the appellant and the respondent to be resolved through arbitration. The court concluded that leave, including incapacity leave and temporary incapacity leave at the respondent’s organisation, is governed by the provisions of Resolution 5 of 2001 of the PSCBC which is a binding collective agreement. This means that the dispute between the parties was required to be submitted to arbitration, as it concerned the application and/or interpretation of the provisions of the PSCBC resolution.

[34] It follows therefore that where an employee – is dissatisfied with a decision by the employer with regard to the issue of leave of absence – his remedy lies in the provisions of the resolution. It follows that the appellant is confined to its remedy in terms of s24 of the LRA.”

The labour court held that the above dictum is directly applicable to the facts of the matter before it and that it is bound by that decision. The De Bruyn judgment makes it clear that, in a case such as the current one, where the employee and her union are dissatisfied with the employer’s refusal to grant temporary incapacity leave, and the procedure for granting or refusing TIL is governed by the collective agreement of the bargaining council, her remedy lies in the referral of a dispute over the application of the resolution to the bargaining council in terms of s24 of the LRA.

The labour court also took into account that De Bruyn is the most recent decision of the labour appeal court on this point. For the reasons set out above, and given the judgement in De Bruyn and the principle of stare decisis, the labour court held that the bargaining council did have jurisdiction to entertain a dispute over the application of Resolution 7 of 2000 in terms of s24 of the LRA. The dispute was remitted to the bargaining council to convene an arbitration hearing on the merits.

Dr Brian van Zyl is a Director at labour law firm Van Zyl Rudd and Associates, www.vanzylrudd.co.za.

This article appeared in the July 2015 issue of HR Future magazine.

New angle on xenophobia

Consider xenophobia from a different angle.

Xenophobia has been dominating headlines in our media over the last while. It may be worthwhile attempting to highlight a different perspective and take on this topic. It is a given that xenophobic attitudes are reprehensible and cannot be allowed and more so xenophobic attacks on the property, life and limb of foreign nationals.

Three categories of foreign nationals find themselves within the confines of the borders of the Republic of South Africa:
• Legal migrants;
• Asylum seeker and refugees; and
• Illegal and undocumented migrants.

Before embarking on a discourse regarding these three categories, let’s deal with the premise underlying xenophobic attitudes and that is the misguided conception that foreigners “steal” jobs from South Africans and “steal” their women. A further extension to this is that all foreigners are engaged in “criminal activities”.

All of these premises are largely misconceptions and incorrect. We will address this in due course. To deal with these premises, one must look at the background of skills migration within a global village context.

Scarce skills are in short supply within the global village and this has become the trend over the last decade and caused an increase in migration of skills globally. Skilled migrants, in the technical and other spheres, have become a much wanted commodity worldwide and it is not only South Africa suffering from this skills shortage, which can be cured to a certain degree by the importation of such skills.

During the past three decades I have seen the most unbelievable array of skills coming into the country. Employing a South African citizen must always remain a priority and be first prize for any prospective employer. However, where that skill cannot be sourced locally nor produced locally, a bridging measure always has to be the importation of such skills.

Highly skilled individuals from other parts of Africa have steadily migrated to South Africa since the advent of the new South Africa, and one cannot paint them with the brush of “stealing” jobs from South Africans where South Africa simply has not produced sufficient, or any, of the skills concerned. By way of example, one could look at the engineering profession. The comment is however not only restricted to the engineering profession.

Employers have a right to employ the best qualified and the best trained candidates for positions in order to maintain and retain a competitive edge in
business. The controls and checks and balances that come into this scenario are provided for in the Immigration Act 13 of 2002 (as amended) “the Act”.

Stringent requirements exist in this legislation, which requires that a prospective employer must advertise in the national printed media for a position and be able to provide sufficient proof that they were unable to secure the services of a South African citizen or permanent resident for the position. It is generally required that an employment agency should be approached in this regard and, as a further control, the Department of Labour must conduct an investigation to determine, based upon information and documentation provided by the prospective employer, to try and secure the services of a South African citizen or permanent resident for the position. In addition the Department of Labour must also do a salary benchmarking exercise in order to provide proof that the remuneration to be offered to the prospective foreign employee not be less favourable than that which would have been paid to a South African citizen in the position.

It is only after all of these hoops have been jumped through that in fact a job offer can formally be made to the foreign national candidate.

It is then that the application should be submitted to the Department of Home Affairs which in itself will take some time.

It is my belief that, had the South African Immigration Act visa process been on a par with the processes in other countries, this would be sufficient a safeguard.

A further provision is made in the Immigration Act for the creation of a “critical skills visa” in which certain defined professions, trades and occupations are declared by the Minster of Home Affairs, ostensibly in consolation with the Department of Labour, Science and Technology and Trade and Industry, which declare a list of such trades, professions and occupations. In terms of the critical skills visa category, it is not necessary to advertise, and the Department of Labour requirement also falls away. The purpose of this is to attract these skills, trades and occupations into our country to attempt to bridge a critical skills gap.

Again, these checks and balances, in my opinion, are adequate and in line with international best practice.

The above however only deals with the formal labour sector and with those foreign nationals who are on valid and proper work visas. There remains an “informal” sector, which I will deal with shortly which must be viewed in a different light.

The second category relates to Asylum Seekers and Refugees. South Africa is a signatory to all the United Nations conventions on Refugee Affairs and adheres to the protocols flowing therefrom. In addition, there are various African Union Conventions in this regard to which South Africa is also a signatory and must honour and respect such Conventions.

A foreign national who had fled their country of usual residence under the fear or threat of death, torture or persecution as a result of their political, religious beliefs, ethnic origins or sexual orientation may claim asylum from the reception country, in this case South Africa. Once an asylum application has been made and such grounded fear of persecution has been declared, then such foreign national enters the stream of process under the Refugees Act and is given an Asylum Seeker temporary permit. This permit must be extended on an ongoing basis pending the outcome of a final determination of refugee status, whether approved or denied.

Until that final determination takes place, the Asylum Seeker is entitled to work or study and certainly to reside in South Africa pending the outcome of such application. He or she is then free to enter the job market on the strength of the Asylum Seeker Temporary permit.

Once an asylum application has been refused, the applicant would have to return home or leave within the defined period and, in the event of a successful determination of refugee status, would be entitled to remain on in South Africa permanently, with the obvious requirement of extending their Formal Refugee Status on an ongoing basis.

Unfortunately, circumstances in certain countries north of South Africa have been such that there has been a massive influx of foreign nationals seeking
asylum in South Africa. One of the other realities of this situation is that many of these migrants who apply for asylum do not really qualify for such asylum as in reality they are economic refugees. A classical example of this would the influx of Zimbabwean nationals into South Africa.

However, an applicant applying for asylum under the Refugees Act must be duly considered and allowed to process their application for asylum up to the final determination phase.

Statistics and numbers are not readily available but the amount of refugees is huge, given the constant queue that exists at the various refugee reception
centres and the enormous backlog that exists in the processing of such applications.

The third category consists of illegal or “informal” migrants who are simply slipping across our very porous borders into South Africa and absorbing
themselves predominately into urban areas. Perhaps a better definition of this category would be that of “undocumented” migrants.

The Minister of Home Affairs in 2010, in an attempt to try and document these undocumented migrants from Zimbabwe, predominately granted to any Zimbabwean national who was in the country illegally or on fraudulent papers an opportunity to legalise themselves under the Zimbabwe Dispensation Project “ZDP” which was followed at the end of last year by the renewing and extension of the project to the Zimbabwean Special Project ‘ZSP’ which legalised them for a further four-year period.

It is not known whether or how successful this project was in bringing these persons into the realms of being documented migrants as the figures declared by the Minister of Home Affairs seem to indicate 250,000 plus migrants availed themselves of this opportunity. The Institute for Security Studies (ISS) was quoted in the media as saying that there were potentially more than two million Zimbabweans alone who have not availed themselves of the process. One has to factor in those who come from other sub-Saharan African countries and further north.

It is almost impossible to gauge those numbers. The magnitude of this situation therefore becomes more apparent. Another factor which must be brought into the equation relates to the high levels of unemployment in South Africa, the current economic situation, the recessive tendencies of a lot of Western economies and also the government to come up with effective strategies and programmes to place this problem into a proper perspective.

One of the unfortunate realities is that crime is rampant in South Africa, but to accuse foreign nationals of being the only perpetrators would be doing an injustice to all. It carries the premise misguidedly that South Africans are therefore squeaky clean and that there are no South African criminals in this situation.

Xenophobia is not unique to South Africa and is regrettably and unfortunately a mind-set which has permeated so many of the darkest periods in world history.

The only solution to sorting the problem out is to effectively deal with strategies to educate our masses, to teach and preach tolerance to them, to speak out publicly against xenophobia and to begin this process within schools, tertiary education institutions, cities, townships and informal settlements alike.

The previous waves of xenophobic attacks and intolerance, together with the current, cannot be tolerated, must be condemned and constructive and proactive action must be taken by government NGOs and citizens of the country alike.

As a second generation descendant of refugees who fled to South Africa to avoid the xenophobic and racist attacks in Eastern Europe before and during the Second World War, I am particularly aware of the dangers and consequences of misguided xenophobic attitudes.

Julian Pokroy is one of South Africa’s leading immigration specialist attorneys, www.immigration.org.za, and currently heads the Law Society of South Africa’s Immigration and Refugee Law Specialist Committee and the Immigration, Nationality and Refugee Law Committee of the Law Society of the Northern Provinces. He is a member of the South African Law Reform Commission Committee.

This article appeared in the July 2015 issue of HR Future magazine.

 

Good parents set an example for their children

If your children were to be asked if they considered you a good example, would you be embarrassed or proud of their answers?

One of the most powerful ways of shaping the behaviour of children is through example. Most responsible adults would like their children to consider them to be people who set an example as parents. One of the ways that we can set such an example is through demonstrating integrity. People generally have a fairly good idea of what integrity means. They will tell you that it refers to being honest, ethical and moral. Few go much further than that, so never consider that the word also refers to a state of being sound and the quality or condition of being complete, whole or undivided.

If you asked most parents if they considered themselves to be people of integrity, you would probably get a resounding, “Yes!”

The reason they would give you is that few people see themselves as dishonest so they want their children to grow up to be honest and ethical and therefore think it’s a good idea to act as an example for them. That’s very good. What many parents don’t realise, though, is that the example they set is not necessarily a good one.

Do parents intentionally set a bad example for their children? I think not. But they often do so unintentionally.

The “do as I say” is a very convenient way of parenting very young children who have to accept their parents’ word as law. They have no other frame of reference in the form of media and friends and other friends’ parents so you’re able to get away with a lot with the, “Because I say so,” answer when questioned.

That won’t however cut with children who have started to think for themselves and certainly not for teenagers who see their friends’ parents in action and have something with which to compare your parenting efforts. That’s why, if you want to be a good example, you have to adopt the “do as I do” approach to parenting.

If you want your children to display exemplary behaviour, you have to display exemplary behaviour to them. For example, if you want your children to be courteous, YOU have to be courteous. If you want your children to be kind, compassionate and considerate, YOU have to be kind, compassionate and considerate. If you want your children to treat other people with respects, YOU must treat them and their mother/father with respect.

That’s what “do as I do” means – you expect them to do it because you are already doing it, not going to do it – maybe – in future.

It’s easy to tell your children that you expect them to be honest. It’s another to demonstrate honesty in everything you do. And honesty doesn’t mean you have a licence to tell people what you think of them (often in a derogatory manner) in the name of being “honest”. That’s not honesty, that’s often just a lack of consideration.

If you don’t start the “do as I do” style of parenting while your children are still young, you’re going to have difficulty getting them to buy into your example when you one day decide to give it a try.

Quite simply, this is one of the main reasons for parents not having influence over their teenaged children. Parents who parent by the “do as I do” method occupy the moral high ground and can hold children to account because they have already held themselves to account. And the beauty of it is that, while your children might not like to admit it to themselves, they will know it and respect you for it. When one day they are parents themselves and you hear them saying the same things to their children as you said to them, you will know you’ve made a success of your parenting!

Alan Hosking is the publisher of HR Future magazine, www.hrfuture.net, and an Age Management and Self- Mastery Coach to senior executives, and the author of best seller What nobody tells a new father.

This article appeared in the July 2015 issue of HR Future magazine.

Education will energise employment

Skills development programmes are crucial to reduce unemployment in South Africa.

According to Statistics SA, in 1994, low-skilled workers made up 43% of the disadvantaged community’s workforce. By 2014, this figure had declined by nine percentage points to 34%, with semi-skilled workers as a percentage of the total, this workforce having increased by six percentage points to 48%. It is undoubtedly clear that skills development programmes and initiatives are an urgently necessary solution to this problem.

The lack of qualified teachers, ineffective teaching and bad subject choices, weak administration, the unwillingness of business and the government to invest in employee training and skills development, and an underdeveloped education system – especially in disadvantaged areas where schools lack basic infrastructure – are all pertinent factors that have contributed to unemployment and poverty in our country.

The unemployment rate, according to Stats SA, has risen sharply in the first quarter of this year, with 26,4 % of potentially economically active South Africans not working. South Africa has nearly 36 million employable people, but only 15,5 million are currently employed. This figure bears testament to a critical situation in need of attention.

It is thus essential for multinational companies, together with other private companies and the government, to implement skills development and upliftment initiatives to help bridge our skills gap and contribute meaningfully towards reducing our large unemployment rate.

Education is the foundation of a successful and flourishing economy and it should be a fundamental component of the annual strategic initiatives of every organisation and the government.

There are several ways in which private sector organisations can contribute to skills development and upliftment and help bridge the large inequality gap in South Africa. Offering bursary opportunities to young graduates who wish to study, or who are already enrolled at various universities and tertiary institutions in South Africa, is one way of helping some of those without the means to gain the opportunity to be upskilled, marketable and employable.

Bursaries

Bursaries should be awarded to individuals on merit provided they have maintained an average grade as per the stipulations set out by the company. The studies for each degree or diploma can be closely linked to the core business of the company offering the bursary.

The bursary programmes should strive to:

– Enhance youth development and employability;
– Create a pool of talent to feed into the sponsoring company’s internship programme, thus providing on-the-job training; and
– Create a skills pool for scarce and critical skills required by the sponsoring company that are not readily available.

Learnerships

Learnership programmes are another way of targeting unemployed matriculants who qualify, depending on the requirements as set out by the sponsoring company. They offer graduates hands-on corporate knowledge and experience in specific fields, depending on the nature of the course and the company involved, thus preparing the learner for their chosen career. Learnership programmes are often structured to enable learners to experience classroom and practical on-the-job training.

Learners who successfully complete the programme are awarded with a qualification recognised by a tertiary institution and with this qualification they already have a much greater chance of finding employment than a matriculant without any specialised skills.

While it is important to have a tertiary qualification, practical expertise and on-the-job training also play a vital role in making an individual employable and marketable within the job market.

One of the main challenges facing youth after graduation is the lack of practical experience and on-the-job training. Companies are looking for experienced individuals who already have a certain number of years’ experience depending on the nature of the job.

Many companies seeking those with practical experience forget that, in order to obtain the required practical experience, the company needs to give the individual a chance to gain experience. A college or tertiary education will demonstrate an academic proficiency. An internship bridges the gap between theory and practical proficiency by providing on-the-job training.

Internships also provide an opportunity for youth to demonstrate their skills and work ethic and often lead to employment once the internship is completed, depending on how the individual has performed through the internship.

During an internship, employers want to see the multi-dimensional thinking necessary to succeed in the workplace. The process of successfully applying, interviewing, obtaining and fulfilling the responsibilities of an internship demonstrates an understanding and ability to sequence and carry out a complicated plan.

Skills development should be an integral part of each organisation’s key business goals – not merely for the purpose of helping to achieve business goals, but also by helping develop the broader industry and continent as a whole.

Developing a talented and qualified workforce is only achieved through a collective effort and we all have a vital role to fulfil in reducing unemployment within our country.

Tumi Zondo is General Manager of Human Resources and Transformation at Total South Africa, www.total.co.za.

This article appeared in the August 2015 issue of HR Future magazine.

Workplace privacy crisis undermines employee engagement

Beatriz Arantes tells Alan Hosking how and why workplace privacy keeps employees engaged.

What’s the connection between workplace privacy and employee engagement?

Most organisations know that they aren’t achieving the full potential of their workforce, but fewer have figured out how to achieve the level of engagement they need. New research sheds light on the impasse. The number one issue of employees’ dissatisfaction is lack of privacy. In addition to needing places that support group work, office workers around the world also need private places to focus and rejuvenate.

Around the world, CEOs recognise a clear correlation between employee engagement and business performance. Although the negative bottom-line impact of disengagement has been well documented by Gallup and others, few organisations can identify the factors that positively affect employee engagement, and even fewer know how to improve it.

As organisations struggle to create strong office cultures, the signals are stronger than ever that many high-potential employees are chronically disengaged at work – unmotivated, unproductive and overly stressed, with little capacity to think creatively, collaborate successfully and generate the innovative solutions that organisations desire.

What workers say they need most for productive work is what most offices today lack: privacy. Lack of privacy is workers’ number-one complaint about their workplace, and the imbalance between collaboration and privacy at many offices has reached crisis proportions.

Aren’t privacy and collaboration mutually exclusive?

Our ongoing research and work with leading companies continues to strengthen the insight that privacy and collaboration must coexist in the workplace. Collaboration remains essential for driving innovation, and workers’ needs for togetherness are as compelling as their needs for times of privacy. The key is to achieve a balance and provide workers with the ability to choose a work setting based on individual needs of the moment.

Are you saying that workplace satisfaction strengthens engagement?

A recent Steelcase-sponsored survey, conducted in 14 countries by the independent research firm IPSOS and including more than 10,500 workers, has confirmed that the majority of people working around the globe (69%) are not fully engaged. Significantly, the results show a strong correlation between employees’ satisfaction with their work environment and their level of engagement. Engaged workers are the most satisfied with their work environment (31%), while the least engaged are also the most dissatisfied with their environment (69%).

The most satisfied and most engaged workers (11%) say their workplace allows them to concentrate easily, work in teams without being interrupted, choose where to work within the office based on their task, and feel relaxed and calm with a strong sense of belonging. In contrast, 85% of workers are dissatisfied. They say they can’t concentrate easily in the office, and 31% go outside of their office to get work done.

What is your basis for saying privacy should be reinvented?

Our researchers recently completed a focused privacy project in North America, Europe and Asia that validated the importance of workers having private times and spaces to focus, reflect and rejuvenate during the workday.

Building on prior studies that explored the spatial properties of privacy (acoustic, visual, territorial and informational privacy), the new research sought to better understand people’s psychological needs for privacy and the types of privacy experiences that are important to people who work in online worlds as well as physical space. By administering surveys and conducting interviews and observational studies, the researchers concluded that that need for privacy exists across cultures, though it may be expressed differently and, within any culture, privacy is contextual to each individual – that is, depending on personality, mood and task. Today’s workers need both information and stimulation control to achieve the privacy they need, repeatedly shifting between revealing/concealing and seeking/blocking stimulation.

What types of privacy do workers seek and what should be done to accommodate these needs?

Researchers identified five distinct types of privacy experiences that workers seek. They are:

– Strategic anonymity: Being “unknown” or “invisible” for a while in order to avoid normal social distractions and restraints;
– Selective exposure: Choosing what others see by being selective about the personal information and behaviours that we reveal;
– Entrusted confidence: Sharing information confidentially within a trusting relationship;
– Intentional shielding: Protecting yourself from others’ sightlines to avoid being observed or distracted, or to develop a personal point of view without the influence of others; and
– Purposeful solitude: Physically separating yourself from coworkers in order to concentrate, express emotions, rejuvenate or engage in personal activities.

Because people experience privacy in these different ways, the key is to design a workplace that supports them all. The paradigm of workplaces dominated by enclosed offices won’t solve the engagement problem. The best way to support today’s workers is to provide the ability to move between individual time and collaborative time, fully leveraging the power of the workplace to strengthen satisfaction and engagement by an ecosystem of different kinds of spaces where people can select the right level of stimulation and informational control.

Beatriz Arantes is the Senior Design Researcher and Psychologist at Steelcase, based in France. She has a Master’s Degree in Environmental Psychology from the Université René Descartes (Paris V) and has previously worked as a Research and Teaching Assistant at Work Psychology and Ergonomics Laboratory/Universidade Federal de Santa Catarina. Beatriz speaks French, English, Portuguese and Spanish.

This article appeared in the August 2015 issue of HR Future magazine.

Get ready for “four second” projects

There’s a new trend on the horizon and it’s not about attracting and retaining employees.

Would you ever hire someone to do just four seconds of work? In the past, of course not! In the future, you probably will. This jarring scenario gives us a warning about how the nature of work is changing.

You may be wondering what kind of work only takes four seconds. Here are a few examples: tagging a photo, typing in the total from a scanned grocery receipt, answering a two-question survey or recording a name in your own voice. Of course, an entire project may involve thousands of photos, receipts, surveys or names. However, that project can be broken down into these tiny micro tasks and in the extreme, an individual worker might do just one task.

This radical deconstruction of work is possible due to talent platforms like Amazon’s Mechanical Turk which allow you to farm out micro tasks to an anonymous army of freelance workers who are paid just a few cents for each task.

This isn’t speculation: Amazon’s Mechanical Turk platform has half-a-million “Turkers” registered to do this kind of micro-work. It’s a specialised business, but a reasonably big one. You may be thinking that this isn’t relevant to you because none of your work can be deconstructed to micro-tasks. Here’s why I am interested, even though I’ll probably never use the platform myself: breaking up a project into thousands of four-second tasks seemed impossible; now it is being done. Whenever the impossible becomes possible, I pay attention.

Old ways versus new

In today’s world, the fundamental unit of work is a job and it typically takes 40 hours a week. When people have to commute to an office, packaging work into that 40 hour week makes sense – no-one wants to commute for just a couple of hours work (let alone four seconds). However, as soon as work can be done electronically from someone’s home, everything changes. A Turker might find an hour here and there in the day to do a whole series of micro-tasks. They make some money and its better than watching television.

As a leader, you need to decide if it makes sense to have work done by employees in full-time jobs or deconstruct the work into pieces and ship it out to specialist free agents. Maybe you could get your assistant to do a PowerPoint presentation for you, but will they do it as well, as quickly and as cheaply as a freelance PowerPoint specialist? Often deconstruction makes sense.

Most organisations get some of their work done by farming it out to free agents, some get most of their work done that way, and some get all their work done by free agents. This last category entirely eschews the use of full-time employees. Knowing what and how much to farm out will be a central facet of a leader’s job in the years to come.

Reconceiving work, reconceiving HR

In the forthcoming book Lead the work, not (just) the employees: the future of work lies beyond employment (Wiley Sept 2015), which I co-authored with Dr. John Boudreau and Tower Watson’s Ravin Jesuthasan, we argue that talent platforms like Mechanical Turk make deconstructing and dispersing assignments to free agents sufficiently easy that it is going to transform how work gets done. Yes, some assignments will be done by traditional employees in traditional jobs, but a lot will be done by free agents working on projects, tasks or micro tasks. For some assignments the performance of free agents – in terms of quality, timeliness and costs – will be so much better than employees that companies who are not skilled at deconstructing and dispersing work will be at a competitive disadvantage.

For HR, this means coming to terms with the fact that a good percentage of your workers, maybe most of your workers, will not be employees. If HR thinks its job is about attracting, retaining and motivating employees then it will be missing half the game.

David Creelman is CEO of Creelman Research, www.creelmanresearch.com. He works with a variety of academics, think tanks, consultancies and HR vendors in the Americas, Asia and Europe.

This article appeared in the August 2015 issue of HR Future magazine.

Curious discontent of finance workers continued …

What are the implications for HR?

Last month, I discussed the findings of a report published by my company that explores the unhappiness – with only 22% reporting being happy at work – of those in the finance industry.

For those who missed it, here’s a summary of the findings:

– Transparency is not the culprit: Research on employee happiness shows a strong relationship between employee satisfaction and organisational transparency. But findings indicate that transparency is abundant in the finance industry.

– Employee appreciation and recognition are low: A large driver of workplace satisfaction is feeling valued for a job well done. Our data showed that this was lacking with only 20% feeling strongly valued at work.

– There are low levels of satisfaction with managers: 53% of employees are indifferent or dissatisfied with their managers. Their responses revealed three distinct problem areas: 1) poor communication, 2) limited mentorship, and 3) minimal time given to them by managers, all leading to general unhappiness.

– There are low levels of satisfaction with colleagues: Nearly 50% reported indifference or dissatisfaction toward their colleagues. Again, their responses revealed three distinct reasons for their dissatisfaction: 1) poor attitudes (complaining too much), 2) not being motivated or taking responsibility, and 3) not being qualified for their role.

This is a group that, presumably, has everything in their favour: high wages, comfortable job-security and challenging work. Yet despite all this, they’re reporting startlingly high rates of unhappiness at work.

I cannot think of a case which better exemplifies the importance of HR. After all, according to traditional indicators of workplace happiness – wages, job security, challenge-level of the work – there should be no problem. If so, why are they so unhappy? What are they lacking? In my mind, it is this: the ‘value-add’ which only HR can provide.

But let me be clear: this is not simply a call for increasing the number of HR staff. Rather, this is a call for a more forceful, vibrant HR. Not simply assigned the role of regulator, HR should be empowered to bolster the productivity of employees.

This new aim of HR comes down to one word: culture. Don’t let the simplicity fool you. In reality, there is nothing simple about culture. Maintaining a vibrant culture requires dedication and no small amount of work. In what follows, I’ll discuss what HR can and should do to manage their organisation’s culture.

Hire (and fire) with culture in mind

During the hiring process, companies typically look for two things: skills and experience. Don’t get me wrong, these are important. But they should not be the total measure of a candidate. A candidate’s personality and values are just as critical, if not more so, than their skills and experience.

Organisations which neglect these other criteria are likely to dishearten and decrease the productivity of their employees. That’s why during the hiring process, it is so critical to question candidates beyond their skills and experience: What motivates them? What are their values? Are they satisfied with meeting expectations or do they desire to exceed them?

These are just a few qualities which affect a candidate’s ‘fit’. When it comes to gauging ‘fit’, no one is quite as well-positioned as HR. Who, after all, better understands the contours of the office – what motivates the team, what drags them down – than HR?

Promote leaders based on leadership-potential

Traditionally, management has been viewed as the top rung in the career ladder. HR needs to change that. With 53% of finance workers reporting indifference or dissatisfaction toward their managers, the problem couldn’t be more evident: some people just are not management material.

When seeking to promote from within, more should be considered than a candidate’s success in his/her past roles. Does (s)he communicate well? Does (s)he command respect from the team? Does (s)he possess the necessary strength and confidence?

HR needs to assess these aspects. And when push comes to shove, they need to be a strong advocate for making leadership promotions based on them.

Of course not everything hinges on the moment of promotion. When an employee is promoted to a leadership position, that should not be the end of the matter. HR should continually assess the performance of the manager and help them to grow in their role.

Create a culture of recognition

Finally, HR ought to actively work toward creating a culture of recognition in the office. Part of this is accomplished by promoting the right people. A manager with good leadership skills will naturally be better at doling out recognition and praise where it is due.

HR, however, should be more proactive than this. In addition to helping managers recognise their employees, HR should create a culture of recognition throughout the office. After all, one’s colleagues are often in a better position to see one’s good work. When that’s the case, everything in the organisation’s culture should compel them towards recognising that good work.

To accomplish this, HR should establish channels of recognition. In some instances, designating a cork-board to pin notes on will suffice. When that doesn’t cut it, there are a number of tech tools designed to easily facilitate recognition. The chosen medium is less important than that the action is taken. Once the action is taken, it can have a huge effect. Recognition can be quite infectious. By taking the lead, HR can start a chain reaction which may snowball into a culture of recognition among employees.

Zachary Sisco is a Communications Associate at Seattle-based employee engagement survey company TINYpulse, www.tinypulse.com.

This article appeared in the August 2015 issue of HR Future magazine.

Click here for part 1.

Curious discontent of finance workers

Four key findings about why finance workers are unhappy.

It’s commonly assumed that people who work in finance are, generally speaking, happy. After all, why shouldn’t they be? High wages, strong job-security, challenging and engaging work – that certainly sounds like the making of a satisfied employee.

But a report recently released by my company shows that this assumption is false. In fact, far from being the happiest industry, the finance industry ranks at number eight. Industries which ranked above it? Construction, technology, healthcare, and hospitality, to name a few.

After seeing how poorly finance performed relative to other industries, we investigated further. We were shocked to see the depth of their discontent. This statistic says it all: only 22% of finance workers reported being truly happy at work.

Major culprits hitting the financial services industry hard

Best industry happiness rankings

How happy are you at work

How could an industry known for generous and secure salaries be so unhappy? It was troubling really. So we dug through survey responses from more than 3,000 employees at nearly 60 organisations in an effort to uncover more. Here’s what we found.

1. Transparency is not the culprit

Transparency is an incredibly strong driver of happiness at work. So when we began examining the responses from finance workers, this is the first place we turned. Transparency, however, was not to blame. In fact the finance industry practically swims in transparency. Asked whether their manager has clearly communicated their roles and responsibilities, an overwhelming 85% of employees responded, “Yes.”

Do you feel that your manager has clearly defined your roles and responsibilities

In their comments, employees were quick to explain that their managers met with them frequently to discuss how they were performing relative to expectations:

– “[My manager] went over my job description with me. Anytime she has anything new for me to do, she takes the time to go through it and explain to me anything I may have questions on.”
– “I have regular catch ups with my manager and my objectives are regularly reviewed. We review my role within my area and I know how I fit in.”

Further illustrating this fact, 87% of respondents answered that their managers set clear company goals for them.

Does your management team set clear company goals

2. Workers are feeling unrecognised

Recognition is a vital component in maintaining employee morale. It’s deeply problematic then that recognition is thoroughly lacking in the finance industry. When asked to rate from 1 to 10, how well recognised they are for good work, a meagre 21% of workers responded with a 9 or 10.

How well are you recognised when you do great work
Perhaps more damning is this: only 20% of finance workers feel strongly valued at work. Their responses explaining this are concerning:
– “No recognition or acknowledgement for hard work, commitment and achievement. Extremely disappointing.”
– “One or two people may say, ‘Good Job,’ but for the most part, I feel as if the perception of me is that I am a waste of cubicle space.”

How valued do you feel at work

3. Leaders are failing their employees

There’s a saying which is commonly thrown about these days: “You don’t quit your job, you quit your boss.” Within the finance industry, it appears that there’s a great deal of truth in this. When asked how they felt about their manager, less than 50% of respondents indicated that they were satisfied, the rest indicating either indifference or dissatisfaction.

This raises the following question: what are managers in finance failing at? The comments from those surveyed indicated three distinct shortcomings:
– Poor communication styles;
– Failing to allocate time to their employees and teams; and
– Not allocating time to their employees’ professional development.

These comments illustrate the problem quite well:
“[My manager] doesn’t help with personal development. [My manager] will talk to employees when setting up goals and personal development but doesn’t help follow up on goals or personal development throughout the year so it’s always a surprise come review time.”

“Discusses confidential matters with another team member. Doesn’t relay important information. The team needs to do their job. Doesn’t stand up for or support the team. Any communication is done by email.”

How would you rate the performance of your direct supervisor

Top 3 reasons for dissatisfaction with direct supervisors

4. Colleagues are failing each other

This may be the most surprising result we found. When asked to rate their colleagues, a whopping 46% of respondents indicated they were indifferent or dissatisfied. This is particularly troublesome as we’ve found that one’s co-workers are the number one factor driving workers to go the extra mile.

Again, their comments indicated three distinct factors driving this discontent:

– Having poor attitudes (that is, complaining too much);
– Not being motivated or taking responsibility; and
– Not being qualified for their role.

How would you rate your colleagues and team members

Reasons employees are dissatisfied with their peers and colleagues

Here are a few of the responses these employees gave:

– “[My colleagues] seem to need a lot of hand holding and they are not taking responsibility of their own [projects].”
– “The skill set is definitely NOT up to par for the changing technology and systems, the poor and negative attitude brings down the rest of the team, and that does not create a positive reflection of [our product] for our customers.”

What’s to be made of all this? I’ll discuss the implications next month in Part Two.

Zachary Sisco is a Communications Associate at Seattle-based employee engagement survey company TINYpulse, www.tinypulse.com.

This article appeared in the July 2015 issue of HR Future magazine.

What’s important when working in Africa

Expats will benefit from intercultural training for African countries.

Africa is now viewed as the next big economic opportunity, as “Africa Rising”. A central feature of this is the positioning of the continent as either a source of near-immeasurable resources or as a growing consumer-driven market. Consequently, companies that wish to benefit from this growing revenue stream are feverishly analysing political risk, infrastructural constraints and other problems related to the cost of doing business in Africa.

While these factors, and the analysis thereof, are vital to business success in African countries; too narrow a focus on them overlooks that doing business in Africa, as in many other regions, is fundamentally about relationships and understanding the environment. To successfully operate in African countries, companies and their representatives must ensure that they build firm relationships both with the people with whom they do business and with the communities within which they are based.

Central to building such relationships is an understanding of local African cultures. As with people the world over, Africans have very varied and vibrant cultures. However, these cultures are not the fixed, unchanging ones they are so often thought to be. While they are generally rooted in past practices, African cultures are dynamic and rapidly evolving. One only has to look at the great range of youth cultures that are in evidence across the continent to realise that Africa is making a confident statement about its place in the world. To ignore such cultural expression would be to lose out on the opportunities inherent in the coupling of Africa’s very young population with its growing consumer class.

In Africa, causing offence through a lack of knowledge of local practice, custom or culture can have a negative effect on productivity and company image. An understanding of local cultures, communities or consumers is, therefore, of particular importance when doing business in African countries. In addition, accurate and relevant content for dynamic African countries is very difficult to obtain.

I am continually surprised, therefore, by the fact that companies that wish to do business in many Asian countries insist on intercultural training for their representatives, but seldom do so when sending their representatives to African countries. It is, perhaps, a result of the assumption that because much of Africa’s business takes place in a few languages of European origin that such companies feel there is little that needs to be done beyond choosing a representative who speaks one of these languages. To do so, however, is a mistake that even representatives of African companies regularly make when sending representatives to do business in other African countries.

Company representatives and expats should, at the very least, have some knowledge of the cultures of the country or community within which they plan to do business. Ideally, they should also have a relatively developed knowledge of the country’s history and socio-political structures.

In short, business people, African and otherwise, who wish to do business in African countries should take the time to learn about the country in which they plan to operate as well as the particular region of that country. Such learning should take the form of structured training that deals with all aspects of the society and not just some potted conception of a national culture.

Company representatives should familiarise themselves with a few aspects of Africa’s long and wonderful tradition of artistic output. They should take the time to read novels written by authors from the country the company is targeting or listen to that country’s music. This will give a sense of the country’s culture and history. Perhaps, more significantly, it will give representatives something to talk about and share with those with whom they plan to do business and, thus, help build the inter-personal relationships that are central to business in Africa.

The benefit for the company is that the expatriate is able to start their assignment with a good understanding of company and local cultures, thus alleviating potential misunderstandings and lost productivity due to cultural clashes involving expat and local employees.

For the expatriate, an awareness of local culture ensures fewer misunderstandings and potential negative perceptions at work. Having an independent support programme provides the expat with the certainty that the company is looking after them and cares that their experience is a positive one. This training makes it easier for the expat to make friends and function efficiently in the work place.

For the accompanying partner, discussing expectations reduces the fear of the unknown, enables them to integrate easier in the local society and empowers them to embrace new cultures.

Dr Sean Rogers has a Ph.D in African Studies and is with Bangkok-based Expats On The Globe and a Member of X2 Movers, www.x2logisticsnetworks.com.

This article appeared in the August 2015 issue of HR Future magazine.

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