1. 1 PRESENTATION TO THE PORTFOLIO COMMITTEE ON PUBLIC SERVICE AND ADMINISTRATION 1 June 2005 REPORT ON THE ABILITIES OF DEPARTMENTS TO DEAL WITH DEVOLVED AUTHORITY REGARDING REMUNERATION & CONDITIONS OF SERVICE PRESENTATION TO THE PORTFOLIO COMMITTEE ON PUBLIC SERVICE AND ADMINISTRATION 1 June 2005 REPORT ON THE ABILITIES OF DEPARTMENTS TO DEAL WITH DEVOLVED AUTHORITY REGARDING REMUNERATION & CONDITIONS OF SERVICE

2. 2 INTRODUCTION  The implementation of the new Public Service Regulations (PSR) with effect from 1 July 1999 ushered in a new approach to HRM in the Public Service.  Departments are expected to develop & implement departmental policies on various human resource related matters previously covered by national policies issued by the MPSA.  EA’s have the authority to develop policies that include –  remunerated overtime (prescribed); and  awarding of salaries above the minimum notches of salary ranges (implied).

3. 3 OBJECTIVE & METHODOLOGY  The objective of the investigation was to monitor, investigate & evaluate how departments deal with remunerated overtime and the awarding of salaries above the minimum notches of salary ranges.  Research focused on the period 1 July 1999 to 31 June 2001 in all national & provincial departments.  Information obtained from departments were analyzed and evaluated to determine:  compliance with requirements of the PSR; and  extent to which departments succeeded in dealing with the devolved authority.

4. 4 STATUTORY REQUIREMENTS: OVERTIME  Statutory requirements on overtime duty are as follows:  Resolution 3 of 1999 of the Public Service Coordinating Bargaining Council (PSCBC) - an EA may authorize compensation for overtime if a written policy is in place.  The PSR - employees to be compensated for duties performed in specific circumstances in excess of their normal hours of attendance.  Basic Conditions of Employment Act, 1997 – limits hours of overtime & specifies the basis of compensation.  Provincial circulars – indicating limitations & overtime tariffs.

5. 5 FINDINGS: DEVOLVED AUTHORITY ON OVERTIME  The cost of remunerated overtime was R1,7 billion during the 2000/01 Financial Year (source: PERSAL).  Only the departments of Agriculture, Government Communications (GCIS), Health, Justice & Constitutional Development and Public Enterprises developed and implemented overtime policies.  Only 21 out of 80 provincial departments (that responded to the request) have implemented overtime policies in the following Provinces: KZN, North-West, Gauteng, Mpumalanga & Free State.  In general, all departmental policies are user-friendly and conform to the statutory requirements.

6. 6 FINDINGS: DEVOLVED AUTHORITY ON OVERTIME (continued)  Monitoring of overtime and expenditure is not covered by the statutory framework or any of the departmental policies.  Many departments failed to develop policies on overtime. Raises serious questions about their ability to deal with the authority devolved.  Protracted negotiation process at departmental level impacted negatively in the implementation of policies.  This also points to the ripple effect that the implementation of the new PSR has had on the capacity required by departments to manage conditions of service.

7. 7 RECOMMENDATIONS: OVERTIME  A good practice example is provided in the report to assist departments in developing their own policies. The example provides for the following:  Scope of applicability.  Circumstances under which overtime work may be authorized.  Manner of compensation: Payment or time-off.  Procedure to obtain approval for compensated overtime.  Control measures, including the keeping of registers.  Claims for overtime compensation.  Rest, meal brakes and traveling.  Monitoring, evaluating and reporting.

8. 8 DEVOLVED AUTHORITY ON THE AWARDING OF SALARIES  The salary grading system implemented in 1996 provided that only the minimum of salary ranges could be awarded on appointment or promotion to employees.  However, the new PSR(1999) gave EA’s flexibility on the awarding of salaries on appointment and promotion.  In terms of PSR V.C.3 an EA may set the salary for a post or an employee above the minimum notch of the salary range indicated by the job weight-  if he or she has evaluated the job, but cannot recruit or retain an employee with the necessary competencies at the salary indicated by the job weight; and  he or she shall record the reason why the salary indicated by the job weight was insufficient.

9. 9 FINDINGS ON AWARDING OF HIGHER SALARIES  PSC found that 74% of the national, and only 34% of the provincial departments awarded salaries above the minimum notches of salary ranges to employees.  The number & percentage of officials to whom higher salary notches were awarded, are as follows:  46 employees (36%) were awarded the 2nd notch;  44 employees (34%) were awarded the 3rd notch; and  23 employees (18%) were awarded other notches e.g. the 1st and 2nd notches of the next higher salary range or the 2nd higher salary range.  It is of concern that only 36% of the posts were evaluated where higher salaries were awarded.

10. 10 FINDINGS ON AWARDING OF HIGHER SALARIES (continued)  Reasons provided by departments for awarding higher salaries are the following:  Making of counter offers.  Compensate for the loss of allowances previously received.  Recruit and retain Affirmative Action candidates as well as suitably qualified persons in scarce fields/ disciplines.  Compensate for additional responsibilities.  The focus is therefore on the retention of persons whose services might otherwise have been lost (this is in line with the intention of PSR).

11. 11 FINDINGS ON AWARDING OF HIGHER SALARIES (continued)  Only 3 departments have developed & implemented policies. The rest indicated that the following problems are experienced:  Development of other policies a higher priority.  The lack of capacity & knowledge (personnel practitioners).  Consultants appointed, but failed to deliver.  HR components recently established as a result of transformation.  The lengthy negotiation process.  Development of policies done centrally in certain provinces.

12. 12 RECOMMENDATIONS ON AWARDING OF HIGHER SALARIES  Given the financial implications attached, decisions in this regard should be based on an accountable framework.  To assist departments, a good practice example is provided in the report on the awarding of higher salaries that mainly deals with -  Principles to be considered when granting higher salary notches.  Responsibilities.  Specific conditions for granting higher salary notches.  It serves as a guideline and departments should customize it to ensure that their unique needs and circumstances are adequately addressed.

13. 13 FINDINGS: ABILITY OF DEPT’s TO DEAL WITH DEVOLVED AUTHORITY  Majority of departments have not put in place the systems necessary to deal with authority devolved to them on –  Remuneration (e.g: overtime)  Conditions of service (e.g: awarding of higher salaries)  The PSC is of the opinion that at the time of the investigation, many departments were not adequately equiped to effectively deal with all of the authority that has been devolved through the PSR.  This was recognized by the MPSA who put into place a number of key initiatives to support departments, including -  Integrated Implementation Programme (readiness & assistance).  Integrated Provincial Support Programme (needs driven).

14. 14 RECOMMENDATIONS: DEVOLVED AUTHORITY  To assist departments in complying with the Public Service rules and procedures, the following is proposed:  The DPSA should issue a list of all policies and procedural frameworks that should be developed emanating from the PSR, whether prescribed or implied.  Policies that have been implemented by departments should be made available on the DPSA web-site.  Departments that have not developed policies should use the examples provided by the DPSA.  Where assistance beyond the mere development of policies is required, the assistance of the DPSA through the Integrated Provincial Support Programme could be requested.  Departments indicate to the PSC on a 6 monthly basis on progress regarding implementation. The PSC would submit reports on all provincial and national departments to provincial legislatures and Parliament respectively.

15. 15CONCLUSION  Results of previous investigations by the PSC into HRM practices such as leave, overtime, career management, probation and performance agreements indicate that not all departments were coping with the demands placed on them through the new PSR.  The findings in this report indicate that at the time of the investigation this was still the case.