DEDICATION ANNUAL REPORT 2014_15... · vision for 2030, which aims to ensure that South Africans have access to training and education of the highest quality, characterised by signiﬁcantly

Education Labour Relations Council (ELRC)

ANNUAL REPORT2014 - 2015

Realising the importance of a unified determination to address labour imbalances that impedes

progress in public education.

HOPE

FUTURE

DEDICATION

SUCCESS

PEHOPEHOP

REGISTERED NAME:Education Labour Relations Council

REGISTRATION NUMBER:LR2/6/6/110

PHYSICAL ADDRESS:261 West Avenue

Centurion0046

POSTAL ADDRESS:Private Bag X126

Centurion0046

TELEPHONE NUMBER:+27 12 663 7446

FAX NUMBER:+27 12 663 9604

EMAIL [email protected]

WEBSITE ADDRESS:www.elrc.org.za

RP159/2015ISBN: 978-0-621-43659-4

Education Labour Relations Council | 2014/15 Annual Report 1

Education Labour Relations Council

(ELRC)ANNUAL REPORT

2014/15

RP159/2015

ISBN: 978-0-621-43659-4

Education Labour Relations Council | 2014/15 Annual Report2

CONTENTS

PART A: GENERAL INFORMATION

1. ELRC GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

2. LIST OF ABBREVIATIONS/ACRONYMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

3. STRATEGIC OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

3.1 Vision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

3.2 Mission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

3.3 Values . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

3.4 Strategic outcome orientated goals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

4. LEGISLATIVE AND OTHER MANDATES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

5. ORGANISATIONAL STRUCTURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

6. MESSAGE BY THE MINISTER OF BASIC EDUCATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

7. MESSAGE BY THE ACTING DIRECTOR-GENERAL OF BASIC EDUCATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

8. FOREWORD BY THE CHAIRPERSON . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

9. ACCOUNTING OFFICER’S OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

PART B: PERFORMANCE INFORMATION

1. STATEMENT OF RESPONSIBILITY FOR PERFORMANCE INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

2. OVERVIEW OF ELRC’S PERFORMANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

2.1 Service Delivery Environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

2.2 Organisational Environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

2.3 Key policy developments and legislative changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

2.4 Strategic Outcome Oriented Goals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

3. PERFORMANCE INFORMATION BY PROGRAMME . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

3.1 PROGRAMME 1: ADMINISTRATION SERVICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

3.2 PROGRAMME 2: DISPUTE MANAGEMENT SERVICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

3.3 PROGRAMME 3: COLLECTIVE BARGAINING SERVICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

4. SUMMARY OF FINANCIAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72

4.1. Revenue Collection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72

4.2. Programme Expenditure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72

4.3. Capital investment, maintenance and asset management plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73


PART C: GOVERNANCE

1. INTRODUCTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75

2. PORTFOLIO COMMITTEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75

3. EXECUTIVE AUTHORITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75

4. THE ACCOUNTING AUTHORITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76

5. RISK MANAGEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77

6. INTERNAL CONTROL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78

7. INTERNAL AUDIT AND AUDIT COMMITTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78

8. COMPLIANCE WITH LAWS AND REGULATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79

9. FRAUD AND CORRUPTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79

10. MINIMISING CONFLICT OF INTEREST . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79

11. CODE OF CONDUCT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80

12. HEALTH SAFETY AND ENVIRONMENTAL ISSUES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80

13. SOCIAL RESPONSIBILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80

14. AUDIT COMMITTEE REPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81

PART D: HUMAN RESOURCE MANAGEMENT

1. INTRODUCTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87

2. HUMAN RESOURCE OVERSIGHT STATISTICS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88

PART E: FINANCIAL INFORMATION

1. REPORT OF THE EXTERNAL AUDITOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93

2. ANNUAL FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97

3. STATEMENT OF RESPONSIBILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99

HOPE

FUTURE

DEDICATION

SUCCESSPart AGeneral Information


1. ELRC GENERAL INFORMATION

REGISTERED NAME: Education Labour Relations CouncilREGISTRATION NUMBER: LR2/6/6/110PHYSICAL ADDRESS: 261 West Avenue Centurion 0046POSTAL ADDRESS: Private Bag X126 Centurion 0046TELEPHONE NUMBER/S: +27 12 663 7446FAX NUMBER: +27 12 663 9604EMAIL ADDRESS: [email protected] ADDRESS: www.elrc.org.zaEXTERNAL AUDITORS: Auditor-General BANKERS: Nedbank


2. LIST OF ABBREVIATIONS/ACRONYMS

AET Adult Education and Training

AGSA Auditor General of South Africa

ANA Annual National Assessment

APP Annual Performance Plan

BCEA Basic Conditions of Employment Act

CAPS Curriculum and Assessment Policy Statements

CCMA Commission for Conciliation, Mediation and Arbitration

CFO Chief Financial Officer

CHE Council on Higher Education

CTU-ATU Combined Trade Union – Autonomous Trade Union

DBE Department of Basic Education

DoH Department of Health

DPS Dispute Prevention Strategy

DRPs Dispute Resolution Practitioners

DSD Department of Social Development

ECD Early Childhood Development

ECDoE Eastern Cape Department of Education

ETDP-SETA Education Training and Development Practices Sector Education and Training Authority

ESSP Education School Support Programme

EXCO Executive Committee

FPP Fraud Prevention Plan

FSDoE Free State Department of Education

GDE Gauteng Department of Education

GEPF Government Employees Pension Fund

GRAP Generally Recognised Accounting Practice

GS General Secretary

HEDCOM Heads of Education Departments Committee

KZNDoE KwaZulu-Natal Department of Education

LDoE Limpopo Department of Education

LSE Learner Support Education

LSEN Learners with Specialised Educational Needs

LTSM Learner Teacher Support Material

MEC Member of Executive Council

MoU Memorandum of Understanding

MDoE Mpumalanga Department of Education

MTEF Medium Term Expenditure Framework

NAPTOSA National Professional Teachers Organisation of South Africa


NATU National Teachers Union

NCDoE Northern Cape Department of Education

NCS National Curriculum Statement

NPDE National Professional Diploma in Education

NQF National Qualifications Framework

NWDoE North West Department of Education

OSD Occupation Specific Dispensation

PED Provincial Education Department

PELRC Provincial Education Labour Relations Council

PEU Professional Educators Union

PFMA Public Finance Management Act

PILIR Policy on Incapacity Leave and Ill-Health Retirement

PMDS Performance Management Development System

PPN Post Provisioning Norms

PSA Public Servants Association

PSCBC Public Service Coordinating Bargaining Council

QLTC Quality Learning and Teaching Campaign

IQMS Intergrated Quality Management System

RBP Relationship Building Process

RPL Recognition of Prior Learning

SACE South African Council for Educators

SACPO South African College Principals’ Organisation

SADTU South African Democratic Teachers Union

SAOU Suid-Afrikaanse Onderwysersunie

SARS South African Revenue Service

SBA School Based Assessment

SCM Supply Chain Management

SIP School Improvement Plan

SITA State Information Technology Agency

SOMAFCO Solomon Mahlangu Freedom College

TPA Teacher Performance Appraisal

TR Treasury Regulations

TSUD Teacher Supply, Utilisation and Development

ULP Unfair Labour Practice

UNISA University of South Africa

VSP Voluntary Severance Package

WCDoE Western Cape Department of Education

WSE Whole School Evaluation

WSP Workplace Skills Plan


3. STRATEGIC OVERVIEW

3.1 VisionTo improve the quality of teaching and learning through labour peace.

3.2 MissionQuality services for excellence in teaching.

3.3 ValuesThe ELRC has adopted the following values:

•• Professionalism: Promote behaviour that is generally accepted to be correct and proper

•• Transparency: Ensure access to information by citizens

•• Independence: The right to making informed decisions independently that minimise or avoid conflict of interest

•• Accountability: Accepting responsibility for actions and decisions taken with allowance for corrective action and penalty for

wrongdoing

•• Fairness and equity: Adjudication of grievances and disputes

•• Social Responsibility: Respond to the social issues of the day

•• Efficiency: Delivery of quality services economically

3.4 Strategic outcome orientated goalsGoal 1: Research and monitoring and evaluation activities provide an evidence base for improved policies and policy implementation in basic education.

Goal 2: Equal importance is attached to proactive dispute prevention and dispute resolution.

Goal 3: Collective bargaining processes maximise the scope of the parties’ shared interest.

Goal 4: Provide appropriate support and training for all involved in dispute resolution and collective bargaining.

Goal 5: Sound communication strategies, special initiatives and campaigns support and complement the core activities of the Council.


4. LEGISLATIVE AND OTHER MANDATES

The ELRC is delisted in terms of the Public Finance Management Act (PFMA) 1 of 1999 (as amended) and now operates in terms of the Labour Relations Act 66 of 1995 (as amended) from 01 April 2015.

Applicable Legislation

•• Labour Relations Act (LRA) 66 of 1995, as amended

•• Public Finance Management Act 1 of 1999

•• Employment of Educators Act 76 of 1998, as amended

•• Further Education and Training Colleges Amendment Act 3 of 2012

Other Mandates

•• Service Delivery Agreement of the Minister of Basic Education

•• Action Plan to 2014: Towards the realisation of schooling 2025


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4. MESSAGE BY THE MINISTER OF BASIC EDUCATION

This annual report of the Education Labour Relations Council (ELRC) is a record of the achievements of the organisation for the period 2014/15. I commend the report to Parliament and all stakeholders in the public education sector.

The Department’s chief commitment is to ensure that quality education becomes an actuality in the public education sector. This commitment is also encapsulated in the National Development Plan’s vision for 2030, which aims to ensure that South Africans have access to training and education of the highest quality, characterised by significantly improved learning outcomes.

The quality of education should be established at the core of the education system, which is basic education. Indeed, Early Childhood Development (ECD) forms a very important part of this foundational phase of education. The Department appreciates the Council’s effort to focus on research, which is geared towards addressing the conditions of service of ECD Practitioners in South

Africa. This research, which was identified during the period under review, will guide and inform policy decisions on the conditions of service for Grade R Practitioners.

The Council also recorded a major accomplishment for the public education sector during the period under review, which is the finalisation of revisions to the Personnel Administrative Measures (PAM). The revised PAM provides improvements in the conditions of service for educators employed in terms of the Employment of Educators Act of 1998 (as amended).

We are pleased that the overall achievements of the Council for the 2013/14 financial period relate to its core business.

Our obligation to education lies not only in our efforts to ensure improvement in the quality of education, but also to build the esteem of the teaching profession. The Council has always played a central role in celebrating and honouring teachers through our annual World Teachers’ Day celebrations. We commend the Council for supporting the programmes of the Department and collaborating with education stakeholders like the National Education Collaboration Trust (NECT) to strengthen celebratory initiatives during the period under review.

On behalf of the Ministry of Basic Education, I extend my gratitude to the Council for all its efforts to make a meaningful contribution to education, during the 2014/15 financial period.

_________________________

Mrs A Motshekga, MPMinister of Basic Education


7. MESSAGE BY THE ACTING DIRECTOR-GENERAL OF BASIC EDUCATION

It is gives me immense pleasure to introduce the Education Labour Relations Council’s annual report for the 2014/15 financial year. The report reflects the work of the Council in addressing matters of mutual interest between the Department of Basic Education and the organised teaching profession.

The Department appreciates the work of the Council during the period under review, particularly in relation to the monitoring of provincial collective agreements. A significant number of agreements were concluded during the 2014/15 financial year, which address combative issues such as the permanent appointment of temporary educators and educator incentives.

The Council demonstrated its support of economic transformation programmes, which the President emphasised in his State of the Nation Address in 2014, as a key area that requires the participation of all public entities. The Council has taken on interns on an annual basis since 2012, in a bid to contribute to the development of South African youth and provide newly graduated students with

the basic workplace skills that they require.

Although the Council is no longer a Public Entity with effect from 1 April 2015, the Department appreciates the commitment of the Council to better understand good corporate governance best practices, without compromising the already enshrined good governance learnt through the application of the Public Finance Management Act (PFMA).

The Council also continued its support of the Quality Learning and Teaching Campaign at national and provincial level during the period under review.

The Department acknowledges with great appreciation the work of the dispute prevention committees at provincial level, which played a major role in identifying potential disputes and affording the Council the opportunity to intervene and offer facilitation to resolve grievances.

I would like to thank the General Secretary of the ELRC and the staff of the Council for their resolute efforts during this financial year to fulfil the core objectives of the Council and for their dedication to the realisation of a quality public education sector.

_________________Mr SG PadayacheeActing Director-General of Basic Education


8. FOREWORD BY THE CHAIRPERSON

It is with great pleasure that on behalf of the Executive Committee (EXCO), I present the Education Labour Relations Council’s Annual Report for the financial year 1 April 2014 to 31 March 2015, which demonstrates our commitment to quality education in the public education sector.

The period under review was characterised by legislative changes which will influence the Council’s hierarchy of accountability. The Council’s delisting as a Schedule 3A public entity severs its association with the Public Finance Management Act (PFMA) 1 of 1999 (as amended) and the Council now solely operates in terms of the Labour Relations Act 66 of 1995 (as amended) as at the end of the 2014/15 financial year.

This legislative development heralds a new era for the Council as it seeks to improve operations and warrants the achievement of the Council’s core mandate to maintain and ensure labour peace in public education.

To demonstrate our commitment to transparency and accountability in the wake of transitioning to a centralised reporting structure, the Council established an in-house internal audit function during the period under review. The unit will ensure sustained management of risks and control processes and improve the effectiveness of our governance structures.

Quality education remains the basis of societal progression and the Council remains committed to ensuring that its operational efforts are geared towards improving conditions in public education.

I extend my gratitude to the ELRC management and staff for the strides made during the 2014/15 period to fulfil the Council’s mandate.

_________________Adv. L BonoChairperson, ELRC


7. ACCOUNTING OFFICER’S OVERVIEW

It gives me great pleasure to present the Annual Report and achievements of the Council for the financial year 1 April 2014 to 31 March 2015.

The Council recorded noteworthy achievements during the period under review in relation to its core operations which are Dispute Management Services and Collective Bargaining Services.

With regard to Dispute Management Services, a total of 762 disputes were referred to the Council during the period under review; a decrease of 14 disputes compared to the 776 disputes referred in the 2013/2014 financial year. This decrease is attributed to improvement in our efficiencies when dealing with disputes.

The Council implemented proactive measures during the period under review to deal with disputes, this includes our dispute prevention committees at provincial level, which continue to contribute to the reduction of disputes on alleged unfair dismissals as well as appointment and promotion disputes.

The Council increased its pool of interpreters and intermediaries during the period under review to circumvent postponement of cases and ensure the availability of skilled interpreters and intermediaries, particularly when dealing with disputes where a child is a victim or witness.

The Council also tabled significant agreements during the period under review to assist in reducing the number of disputes received and to ensure that a greater scope of Conciliators and Arbitrators are appointed with the requisite skills to finalise disputes expeditiously. These agreements are the draft Collective Agreement on ELRC Guidelines for Promotion Arbitrations and Collective Agreement No. 1 of 2015 on the appointment of a panel of Conciliators and Arbitrators.

The Council exceeded its target to train 240 Dispute Resolution Practitioners (DRPs), as 345 DRPs were trained. A total of 94 Panellists were also developed during the period under review. The training of Dispute Resolution Practitioners and Panellists improved the efficiencies of the Council in terms of the quality of the outcomes, arbitration awards, settlement agreements and rulings rendered.

The Council’s performance in terms of collective bargaining improved considerably during the period under review compared to performance in the 2013/14 financial year, particularly in relation to national collective bargaining.

Parties succeeded in addressing long-standing items on the agenda of the Council, including the Quality Management System (QMS) for School-Based Educators. Draft Collective Agreement No. 2 of 2014: QMS for School-Based Educators, seeks to provide coherence and synergy between all the agreements concluded on performance management.

The performance of provincial chambers remained on par with that of the 2013/14 financial year. This is evidenced by the collective agreements concluded in KwaZulu-Natal, Mpumalanga, Gauteng and North West.

The Council strengthened efforts during the period under review to develop and implement policies that cultivate staff welfare, this includes the Total Reward Strategy, Salary Benchmarking and Remuneration Policy which aligns the remuneration of staff with that of market standards. This policy was approved during the period under review and implemented at the beginning of the 2015/16 financial year.


Improvement in the Council’s Human Resources processes will ultimately benefit the operations of the Council and ensure that we maximise the impact of our efforts to improve the quality of public education.

As the Accounting Officer of the ELRC, I am satisfied with the output and delivery of the core business services of the Council. This report demonstrates the commitment of the Council to the principles of transparency, accountability and service delivery.

_________________Ms NO FocaAccounting Officer, ELRC

HOPE

FUTURE

DEDICATION

SUCCESSPart BPerformance Information


1. STATEMENT OF RESPONSIBILITY FOR PERFORMANCE INFORMATION

Statement of Responsibility for Performance Information for the year ended 31 March 2015In my opinion, the performance information fairly reflects the actual achievements against planned objectives, indicators and targets as per the strategic and annual performance plan of the ELRC for the financial year ended 31 March 2015.

The performance information of the ELRC set out on page 24 to page 91 is approved by the Executive Committee of the Council.

_________________

Ms NO FocaAccounting Officer, ELRC


2. OVERVIEW OF ELRC’S PERFORMANCE

2.1 Service Delivery EnvironmentThe ELRC is a bargaining council composed of the Department of Basic Education as the Employer and the admitted Teacher Unions.

It operates in the public education labour relations environment and over the years has managed to contribute towards labour peace in public education. In order to improve the delivery of services over the next three years, the Council has taken steps to improve the efficiencies in dealing with matters of mutual interest by revisiting its mandate and providing strategic direction.

Identified factors that negatively affect the performance of the Council will be addressed with the objective of improving areas considered important in contributing to Outcome 1: “Improved quality of basic education”.

2.1.1 Dispute Management Services

2.1.1.1 Dispute PreventionThe objective of Council in dispute prevention is to employ a proactive approach and intervene to resolve grievances, before they develop into disputes. Council provides training for practitioners - both panellists and Parties. Another mechanism put in place by the Council to prevent disputes is the functional Dispute Prevention Committees at provincial level.

The Committees contributed significantly to the reduction of grievances related to promotional posts at provincial level. The work of the Dispute Prevention Task Teams also focussed on the need for a comprehensive workshop on Discipline of Educators in KwaZulu-Natal and Gauteng.

2.1.1.2 Facilitation and InterventionNo intervention took place during the period under review.

2.1.1.3 Dispute ResolutionIn the rendering of Dispute Resolution services, greater focus was placed on improving the efficiencies relating to the resolution of disputes relating to Appointments and Promotions.

The nature of disputes referred to the Council during the period under review predominantly relate to Unfair Labour Practices relating to “Promotion and Appointments” and “Unfair Dismissals”. The Council intends to reduce the number of disputes referred by embarking on training for Parties on grievance and disciplinary procedures.

The Council received a total of 762 disputes for the 2014/2015 financial year.

The Council has adopted the following proactive measures to deal with disputes:

•• The Council established dispute prevention committees in all provincial chambers in the 2013/14 financial year with the

aim to analyse statistics on Promotion and Appointments and Unfair Dismissal disputes, in a bid to address these issues.

This measure is yielding positive results in relation to the nature of disputes referred, particularly disputes on alleged unfair

dismissals. There has been a noticeable reduction, from 776 disputes referred in the 2013/14 financial year, to 762 referred in

the 2014/15 financial year.

•• The Council is recruiting interpreters and intermediaries in order to overcome delays and postponement problems associated

with unavailability of such persons whenever they are requested. These persons are very critical in ensuring that the rights of

the child are protected in disputes where the child is attending arbitration processes, either as a victim or witness.


•• The Council continues to ensure that appropriate venues are booked for special hearings involving the child, e.g. Magistrate

Court, Children’s Court or Teddy Bear Clinic (Johannesburg) and the Department of Social Development in Free State and

Northern Cape. The Council also ensures that intermediaries are appointed to protect the rights of the child, as stipulated in

Section 28 of the Constitution, “The right of the child is of paramount importance in all matters concerning the child”. The

Council has also embarked on a recruitment process for interpreters and intermediaries to assist where required.

•• The draft Collective Agreement on ELRC Guidelines for Promotion Arbitrations, which was tabled in the fourth quarter of the

2014/15 financial year, will assist the Council to reduce disputes related to promotions and appointments.

•• A total of 345 Dispute Resolution Practitioners and 94 Panellists were trained during the period under review. The training of

Dispute Resolution Practitioners and Panellists improved the efficiency of the Council in terms of the quality of the outcomes,

arbitration awards, settlement agreements and rulings rendered.

•• Collective Agreement No. 1 of 2015 on the appointment of a panel of Conciliators and Arbitrators was tabled during the

fourth quarter of the 2014/15 financial year. The agreement will ensure that the Council has a greater scope of conciliators and

arbitrators allocated to each province, which will assist with the speedy finalisation of cases.

2.1.1.4 Collective Bargaining Services

2.1.1.4.1 Incentives for Educators

Parties to Council continued to monitor the implementation of the current policy on incentives in the 2014/15 financial year.

2.1.1.4.2 Research

The Council achieved its objective to identify one evidence based teacher welfare and national development issue, which was the need to embark on research to address the conditions of service of ECD Practitioners in South Africa. Council has approved the Concept document “Policy and Conditions of Service for Institutionalisation of Grade R Practitioners” and has appointed a researcher to conduct the research.

2.1.1.5 Other achievementsThe Personnel Administrative Measures (PAM) task team concluded its work during the 2014/15 financial year. The Revised PAM has been recommended to the Minister for publication and the finalised document will be published and disseminated upon approval in the 2015/16 financial year. This is another triumph for the Council, as the revision of the PAM has been another long standing item on the agenda of Council.

Parties succeeded in addressing another long-standing item on the agenda, Quality Management System (QMS) for School-Based Educators. Draft Collective Agreement No. 1 of 2014: Quality Management System (QMS) for School-Based Educators, is an important accord between Parties, as it seeks to provide coherence and synergy between all the agreements concluded on performance management.

The Council demonstrated its support of economic transformation programmes, which the President emphasised in his State of the Nation Address in 2014 as a key area that requires the participation of all public entities. The Council has taken on interns on an annual basis since 2012 in a bid to contribute to the development of South African youth and provide newly graduated students with the basic workplace skills that they require.


2.2 Organisational EnvironmentThe structures and processes of the Education Labour Relations Council are well established and matured and remain stable. The Council’s Supply Chain Management (SCM) unit became operational in the 2014/15 financial year and training on procurement was provided to officials to improve their competence and skills in supply chain management.

The establishment of the SCM unit has enabled the Council to comply with the PFMA, Treasury Regulations and Preferential Procurement Policy Framework Act (PPPFA). Standard operating procedures such as control measures were put in place to ensure compliance and accountability.

The supply chain management systems in place also allow the Council to identify critical risk factors, particularly relating to suppliers.

The Council recognises that its most valuable asset are its Human Resources. A great deal of time and money is invested in recruitment, training and development of employees and as such every effort is made to retain these employees who have critical skills.

Following the Work-Study Project that was conducted in the 2013/14 fiscal year, it was recommended that a Total Reward Strategy, Salary Benchmarking and Remuneration Policy be established to ascertain if the employees of the Council were remunerated in line with market standards. A service provider was identified and results were implemented accordingly with effect from 1stApril 2015.

As part of implementing the Council’s Retention Strategy, one employee was recognised for having served the Council for a period of 14 years as well as 10 employees who have served the Council for nine years. It is envisaged that initiatives like these will ensure that the Council retains its human capital and thereby continuously improve the services it renders.

Another significant achievement is that for the first time since the ELRC’s inception, the Council was privileged to have received a bursary for three employees to further their studies to the tune of R90 000.00.

The Council has made tremendous strides in its effort to fill critical positions and only six vacant positions are to be filled in the 2015/16 financial year.

The ELRC adopted a Recruitment and Retention strategy, which was implemented during the period under review to provide a framework that will ensure that the Council is properly resourced with human capital. This will contribute to the achievement of the Council’s strategic objectives.

The Council developed a five-year Employment Equity Plan, which has been submitted to the Department of Labour. This Plan only came into effect in the fourth quarter of the 2014/15 financial year, as Council now has a staff complement of more than 50 employees.

The Safety, Health and Environmental (SHE) Committee for staff was established during the period under review. The Committee will aid in improving working conditions for staff and to circumvent injuries in the workplace.


2.2.1 Internal Audit An in-house internal audit function was established during the period under review. The role of the internal audit structure is to improve the effectiveness of governance, risk management and control processes.

The following documents were approved during the period under review: the Internal Audit Charter; Three-year Internal Audit Rolling Plan and Annual Internal Audit Plan. The Internal Audit Plan was informed by strategy and key risks that may impair the realisation of strategic objectives and goals.

2.2.2 Building Refurbishment ProjectThe Council’s Building Refurbishment Project commenced in the period under review and significant progress has been made as 5% of the project work was recorded at the end of the 2014/15 financial year. The project is set to realise the completion date of November 2015.

2.2.3 Funding ModelThe funding model of the Council poses a challenge in that revenue is generated through contributions by the Employer and deductions from the educators. Although the rate of contributions is determined through negotiations by the Parties to Council, there is no provision for annual increases. This results in a static and fixed flow of secured revenue in an environment of increasing costs due to inflation. A proposal to address this challenge was tabled to Parties to Council for consideration.

A draft Levy Agreement was subsequently tabled in the fourth quarter of the 2014/15 financial year. The purpose of the agreement is to increase levies collected from the Employer and Employee Parties, in order to finance the operations of the Council and to ensure financial sustainability in the long term.


2.3 Key policy developments and legislative changesThe uncertainties on the future of the Further Education and Training Colleges Bargaining Unit (FETCBU) within the ELRC was addressed by Council during the 2014/15 financial year, as it approved the submission made by the FETCBU for the designation of the ELRC to include lecturers employed in terms of the Public Service Act and as per the FETC Amendment Act 1 of 2013 in its scope.

The Council embarked on a process to delist as a Schedule 3A Public Entity in the 2014/15 financial year. This process was finalised at the end of the reporting period as approval was obtained from the Minister of Finance. The Council’s delisting is effective from the 31st of March 2015.

2.4 Strategic Outcome Oriented Goals

Strategic Outcome Oriented Goals Progress

Goal 1:Research and monitoring and evaluation activities provide an evidence base for improved policies and policy implementation in basic education.

Council approved the research concept document on the Policy and Conditions of Service for the Institutionalisation of Grade R Practitioners and the appointment of a researcher to conduct the research.

Goal 2:Equal importance is attached to proactive dispute prevention and dispute resolution.

The Dispute Prevention Committees at provincial level played a major role in resolving grievances related to promotional posts, during the period under review.

Goal 3:

Collective bargaining processes maximise the scope of the Parties’ shared interest.

The following national Collective Agreements were concluded during the period under review:

•• Collective Agreement 1 of 2014: The Process of Acquiring Organisational Rights in the Education Sector;

•• Collective Agreement 2 of 2014: Quality Management System (QMS) for School Based Educators; and

•• Collective Agreement 1 of 2015: Appointment of a Panel of Conciliators and Arbitrators.

Goal 4:

Provide appropriate support and training for all involved in dispute resolution and collective bargaining.

The ELRC conducted professional training and development for 94 Panellists during the period under review.

The training was aimed at improving the quality of the Council’s Panellists by discussing: relevant legislation; case law; new developments; and problematic issues in the education sector.

The Council also arranged training for 345 Dispute Resolution Practitioners, which was facilitated by the Commission for Conciliation, Mediation and Arbitration (CCMA) and Nelson Mandela Metropolitan University (NMMU) on Labour Law Amendments and dispute resolution processes.


Strategic Outcome Oriented Goals Progress

Goal 5:

Sound communication strategies, special initiatives and campaigns support and complement the core activities of the Council.

The Council intensified its marketing activities during the period under review. A two-page advertorial was placed in the 5th Edition of the Education Handbook.

The Council published its Message of Support for the National Teaching Awards in the Teacher supplement (Mail & Guardian).

The Council also participated in national and provincial exhibitions. This includes African Education Week in July 2014 and exhibitions at national and provincial union conferences from 12 June to 16 July 2014.

The ELRC conducted survey research in the 2014/15 financial year. The aim of the research was to establish how the Council’s clients (educators in public education) perceive the Council.

Another objective of the study was to obtain recommendations to improve the Council’s visibility amongst teachers. A total of 1 862 educators responded to the questionnaire.

The Council is embarking on an awareness campaign in the 2015/16 financial year, to address the recommendations from the study.

Administration Services

“The recipe of any oraganisation’s success story embraces the efforts of support structures that work towards fulfilling its broader objectives.”

AchievementsThe ELRC adopted a Recruitment and Retention strategy, which was implemented during the period under review to provide a framework that will ensure that the Council is properly resourced with human capital. This will contribute to the achievement of the Council’s strategic objectives.

The ELRC conducted survey research in the period under review. The aim of the research was to establish how educators in public education perceive the Council. The objective of the study was also to obtain recommendations to improve the Council’s visibility amongst teachers.

In ensuring complaince and optimising the Council’s information systems, onsite and offsite backup equipment was purchased during the period under review, to ensure that the Council’s operations are not severely affected in case of a disaster. A ticketing system was also implemented during the period under review, to ensure that daily IT queries are streamlined and addressed timeously.

“The recipe of any oraganisation’s success story embraces the efforts of support structures that work towards fulfilling its broader objectives.” B.L

Finance Information Technology

Research & Media Human Resource Management

3 PERFORMANCE INFORMATION BY PROGRAMME


3.1 Programme 1: Administration Services

PurposeThe purpose of Programme 1 is to provide support services to the core operational functions of the Council, to ensure that it delivers an efficient and effective service based on its mandates.

Sub-programmes•• Financial and accounting services

•• Information Technology and communication services

•• Mobilising employee services

Strategic Objectives•• Maintain and improve financial and administrative systems

•• Procure goods and services within policies and guidelines

•• Maintain good labour relations

•• Train and develop staff

•• Ensure a healthy and safe work environment

•• Maintain and improve the premises and security systems respectively

•• Provide reliable information technology and communication systems

Strategic objective annual targets for 2015: Administration Services


Strategic objectives

Actual Achievement

2013/2014

Planned Target2014/2015

Actual Achievement

2014/2015

Deviation from planned

target to Actual Achievement for

2014/2015

Comment on deviations

Minimise fruitless and wasteful expenditure

Not applicable Reduce by 100% Not Achieved

154%

+54%

Increased by 54% from the 2013/14 financial year

Parties failing to attend meetings.

Eliminate irregular expenditure

Not applicable No irregular expenditure

Not Achieved

Irregular expenditure was incurred to the tune of R145 302.

100% The irregular expenditure that was incurred related to non-compliance with the requirements of Treasury regulations 16A3 and Practice note 8 of 2007/8.

The Council has implemented controls to ensure that all supply chain requirements are complied with.




Actual Achievement

2013/2014


Actual Achievement

2014/2015



2014/2015


Implement the Council’s Marketing Strategy to promote the image of the ELRC

Not applicable Conduct survey research to measure how the Council is perceived by educators

(Sample: 4 000 educators)

Achieved

Survey research conducted and findings presented to management

(Sample: 1 862 educators)

None

Establish a SCM unit and provide training

Not applicable SCM officials trained and developed

Not Achieved 100% Due to the finalisation of the refurbishment procurement, the training of SCM Officials has been deferred to the 2015/16 financial year.

Train and develop staff

Not applicable 30 Achieved

53

+23

Introduce and conduct employee wellness programmes

Not applicable 4 Achieved

4

None

Manage the property and assets of the Council with focus on increasing effectiveness, economy, transparency and integrity

Not applicable 80% of refurbishment completed

Not Achieved

100% demolition work done and excavation has commenced.

-75 % Site hand over was done on 26th January 2015 to the Contractor

Overview of the Administration Services Department’s performance for the 2014/15 financial year

Finance and administrative systemsThe Council finalised the process of changing banks during the period under review. The new bank account with First National Bank, is fully operational from 1st April 2015.

The South African Revenue Services refunded the Council an amount of R920 675, in relation to the R1,8 million that was incorrectly deducted from the ELRC’s bank account.


Information TechnologyThe majority of the Council’s IT findings were addressed in the 2014/15 financial year. Onsite and offsite backup equipment was purchased during the period under review to ensure that the Council’s operations are not severely affected in case of a disaster.

The ticketing system was also implemented during the period under review, to ensure that daily IT queries are streamlined and addressed timeously.

IT policies were also updated during the period under review, this includes an update of the Council’s Disaster Recovery Plan and IT Policy on Hardware and Software. New policies were also drafted during the reporting period, including the IT Change Management Policy and the Patch Management Policy.

CommunicationsThe Council compiled a research report in the fourth quarter of the 2014/15 financial year and the recommendations from the study will inform the marketing activities of the Council for the 2015/16 financial year.

The marketing activities for the period under review were intensified to ensure that educators in all provinces were reached through participation in provincial union exhibitions.

Building Refurbishment ProjectThe target for the refurbishment was set to be achieved at 80%; despite the non-achievement, the Council has handed over the site to the appointed Contractor (Bula Projects). This is a major stride in ensuring that the refurbishment is finalised by November 2015.

Strategy to overcome areas of underperformanceFruitless and wasteful expenditure

The Council will introduce a “Cost Order” process in the 2015/16 financial year in an effort to curb wasteful expenditure.

Changes to planned targetsNo changes were made to planned targets.

Linking performance to budget

2014/15 2013/14

Programme Name BudgetActual

Expenditure(Over)/Under Expenditure Budget

Actual Expenditure

(Over)/Under Expenditure

Administration Services R’000 R’000 R’000 R’000 R’000 R’000

Facilitation Services 384 200 184 5 511 3 979 1 532

Communication Services 1 883 1 149 734 1 557 868 689

Finance, Accounting Services and Facilities Management Services 12 629 12 072 557 8 481 6 320 2 161

Mobilising Employees Services 2 361 3 289 (928) 4 638 4 505 133

Total 17 257 16 710 547 20 187 15 672 1 515

Dispute Management Services

“The future will always be marked by the footprints of the young, who stand on the shoulders of giants that are simply called teachers. We endeavour to pave a smooth path for the teacher, to ensure the realisation of a prosperous future, commanded by educated leaders.” B.L

AchievementsThe Council recruited Interpreters and Intermediaries during the reporting period to overcome delays and postponement problems associated with the unavailability of such persons. Interpreters and Intermediaries are very critical in ensuring that the rights of the child is protected in disputes where the child is attending arbitration processes, either as a victim or witness.

Collective Agreement No. 1 of 2015 on the appointment of a panel of Conciliators and Arbitrators was tabled in the period under review. The agreement will ensure that the Council has a greater scope of Conciliators and Arbitrators allocated to each province, which will assist with the speedy finalisation of cases, particularly special cases involving the child.



“The future will always be marked by the footprints of the young, who stand on the shoulders of giants that are simply called teachers. We endeavour to pave a smooth path for the teacher, to ensure the realisation of a prosperous future, commanded by educated leaders.” B.L

AchievementsThe Council recruited Interpreters and Intermediaries during the reporting period to overcome delays and postponement problems associated with the unavailability of such persons. Interpreters and Intermediaries are very critical in ensuring that the rights of the child is protected in disputes where the child is attending arbitration processes, either as a victim or witness.

Collective Agreement No. 1 of 2015 on the appointment of a panel of Conciliators and Arbitrators was tabled in the period under review. The agreement will ensure that the Council has a greater scope of Conciliators and Arbitrators allocated to each province, which will assist with the speedy finalisation of cases, particularly special cases involving the child.

3.2 Programme 2: Dispute Management Services

PurposeThe purpose of Programme 2 is to manage disputes proactively. This includes prevention of disputes by, for example, defusing conflicts that can disrupt teaching an d learning; it also includes dispute resolution. Professional development and training is included in Programme 2 to ensure that Dispute Resolution Practitioners (DRPs) and Panellists operate effectively.

Strategic Objectives•• Provision of dispute resolution services

•• Training of Dispute Resolution Practitioners

•• Panellists Professional Development Services



Performance Indicator

Actual Achievement

2013/14

Planned Target

2014/15

Actual Achievement

2014/15


target to Actual

Achievement 2014/15


Provision of dispute resolution services

Conciliations finalised within 30 days

91% 100% Not Achieved

67%

464 disputes in jurisdiction, 309 were conciliated within 30 days

33%

155

Some cases are Basic Conditions of Employment Act (BCEA) cases, i.e.non-payment of salaries and do not require conciliation, only arbitration. Some cases continued beyond the end of the quarter, but were in line with the 30-day timeframe.

A number of cases could not be finalised due to school holidays and the shutdown period in December.

Training of Dispute Resolution Practitioners

Dispute Resolution Practitioners Trained

240 240 Achieved

345

+105 Parties responded positively to the invitation to attend trainings scheduled for the four quarters.

Budget representation was performed to meet the demand on this key target of the Council.

Panellists Professional Development

Panellists Professionally developed

None 80 Achieved

94

+14 The Panellist Recruitment Drive increased the number of attendees. Training was provided to Panellists in all nine provinces.

Overview of the Dispute Management Services Department’s performance for the 2014/15 financial year

Disputes Referred by Financial YearA total of 762 disputes were received by the Council for the 2014/2015 financial year. This marked a decrease of 14 disputes, compared to the 776 received in the 2013/14 financial year. The nature of disputes referred to the Council during the period under review predominantly relate to Unfair Labour Practices relating to “Promotion and Appointments” and “Unfair Dismissals”. The Council intends to reduce the number of disputes referred by embarking on training for Parties on grievance and disciplinary procedures.

Disputes Referred by JurisdictionFor the period under review, the ELRC received a total of 762 disputes. Of these, 464 disputes were deemed to be “In Jurisdiction” and 298 disputes were found to be “Out of Jurisdiction”.


Disputes referred by Province

149$

136$

133$85$

73$

59$

54$

44$28$ Eastern$Cape$

KwaZulu9Natal$

Gauteng$

Western$Cape$

Free$State$

Limpopo$

North$West$

Mpumalanga$

Northern$Cape$

The Eastern Cape Province referred the highest number of disputes, which was 149 of the total disputes referred. This was followed by KwaZulu-Natal with 136 and Gauteng with 133 disputes. Western Cape referred 85 disputes; Free State 73; Limpopo 59; North West 54; Mpumalanga 44 and Northern Cape referred 28 disputes and one national dispute.

The Eastern Cape Province remains the highest dispute-referring province even though the number of cases has dropped slightly (by 18 cases), when compared to the 2013/14 financial year. There has also been a reduction in the number of disputes referred by KwaZulu-Natal.

The following provinces: Northern Cape; Mpumalanga; Limpopo; Free State; and North West, however remained fairly consistent with the number of disputes referred when compared to the 2013/14 financial year.


Nature of disputes referred

Provinces ULP Promo/

App

Other

ULP

Unfair Dismissal

Special Disputes involving a learner

BCEA Interpretation and

Application of Collective Agreement

Mutual Interest

Total

EC 25 17 15 2 8 16 0 83

GP 25 19 23 12 9 4 0 92

FS 1 18 23 2 0 2 0 46

LP 5 11 14 2 5 3 0 40

MP 5 10 12 0 0 0 0 27

NW 5 11 15 0 7 1 0 39

NC 1 3 11 0 1 0 0 16

WC 25 7 15 1 3 4 0 55

KZN 17 20 20 0 7 1 0 65

Total 109 116 148 19 40 31 463

In jurisdiction as per nature of dispute

Of the 762 disputes that were received by the Council, 464 were found to be jurisdictional. Of the 464 that were jurisdictional, 109 related to ULP – Promotion and Appointments, 148 to Alleged Unfair Dismissal, 116 to Other ULP’s. A total of 40 disputes related to BCEA and 31 related to Interpretation of Collective Agreements. A total of 19 disputes involved a learner and one national dispute was received.

Out of Jurisdiction as per Nature of Dispute

Provinces ULP Promo/

App

Other

ULP

Unfair Dismissal

Special Disputes involving a learner

BCEA Interpretation Mutual Interest

Total

EC 12 21 8 0 2 23 0 66

GP 11 5 16 5 3 1 0 41

FS 5 6 11 1 1 3 0 27

LP 5 8 4 0 1 1 0 19

MP 1 9 7 0 0 0 0 17

NW 3 4 4 0 4 0 0 15

NC 1 2 6 2 1 0 0 12

WC 13 4 7 1 1 4 0 30

KZN 29 12 19 1 4 6 0 71

Total 80 71 82 10 17 38 0 298

Of the 298 disputes found to be out of jurisdiction, 82 related to Unfair Dismissal, 80 related to ULP-Promotion and Appointments, 71 were Other ULP’s, 17 were BCEA related, 38 related to Interpretation of Collective Agreements and 10 related to special disputes involving a child or learner.


Events Conducted for the Financial Year

Provinces Conciliation/Pre Arbitration Arbitration Total

KZN 69 155 224

GP 91 143 234

FS 50 108 158

EC 65 114 179

WC 47 76 123

NC 19 27 46

MP 19 57 76

NW 33 118 151

LP 29 73 102

Total 423 871 1293

* Only one National dispute was received.

A total of 1 294 events were conducted for the 2014/15 financial year. Of these, 423 were conciliations and 871 were arbitration processes. The statistics reveal that all conciliations were concluded in a single event. The Council had a decrease of 41 events in the 2014/15 financial year, compared to the 2013/14 financial year. This is due to the decreased number of referrals received in the 2014/15 financial year.

Dispute by OutcomesThe ELRC finalised a total of 486 disputes during the 2014/15 financial year. A total of 185 arbitration awards were rendered. A total of 98 disputes were settled at arbitration, whilst 40 were settled at conciliation. A total of 90 were withdrawn, with 32 being withdrawn at conciliation and 58 withdrawn at arbitration. A total of 13 cases were dismissed at arbitration and 52 rulings were handed down during this period.

Outcome of Special DisputesA total of 19 special disputes were referred to Council during the period under review. These disputes involved the child/learner as victim or witness. Eight awards relating to special disputes were rendered in the period under review. The speedy finalisation of special disputes are dependent on the complexity of the cases as well as the number of adjournments and postponements granted. Some of these special disputes are inherently complex and require a great number of witnesses.

Carried over cases per financial yearsA total of 164 disputes are being carried over to the 2015/16 financial year. Of these, 138 disputes relate to the 2014/15 financial year and 26 relate to previous financial years.

Postponements and AdjournmentsA total of 112 cases were postponed for the period under review and 136 adjournments took place. The adjournments are as a result of the complex nature of cases and these cases are not finalised during the first hearing. Postponements occur as a result of matters not sitting due to the fact that some Panellists are unable to conclude pre-arbitration minutes with the Parties (as they either come unprepared to the hearing or the person who came to the hearing was just appointed that morning and does not know much about the dispute). Clause 55 of the Council’s constitution however provides for the postponement of matters.


Labour Court ReviewsIn the period under review, a total of 22 Arbitration Awards/Rulings were referred to the Labour Court for review in terms of Clause 71 of the ELRC Constitution or Section 145 of the Labour Relations Act of 1995 as amended.

The Council received four Labour Court orders / judgments, namely:

Four review applications have been referred back to Council for De Novo (new) hearings.

The remaining 22 review applications are still in the process of being heard by the Labour Court.

Strategy to overcome areas of under performanceThe Council is recruiting interpreters and intermediaries in order to overcome delays and postponement problems associated with unavailability of such persons when they are so requested. These persons are very critical in ensuring that the rights of the child is protected in disputes where the child is attending arbitration processes, either as a victim or witness. Furthermore, in hearings where a child is a victim or a witness, the Council continues to ensure that appropriate venues are booked for these special hearings e.g. Magistrate Court, Children’s Court or Teddy Bear Clinic (Johannesburg) and the Department of Social Development in Free State and Northern Cape. The Council will also ensure that intermediaries are appointed to protect the rights of the child, as stipulated in Section 28 of the Constitution, “The right of the child is of paramount importance in all matters concerning the child”. The Council has also embarked on a recruitment process for the interpreters and intermediaries to assist where required.



2014/15 2013/14

Programme Name

Budget Actual Expenditure




R’000 R’000 R’000 R’000 R’000 R’000

Dispute Management Services 10 115 12 712 (2 597) 13,144 10,599 2,545

Total 10 115 12 712 (2 597) 13,144 10,599 2,545

Dispute Management Services – Higher Education And Training (FET)

Cases referredDuring the 2014/15 financial year, a total of 98 FETC disputes were referred to the Council. This marked an increase of 40 compared to the 2013/14 financial year. Of these, 63 were found to be jurisdictional, 31 were out of jurisdiction and four had condonation applications.


Referrals in jurisdiction by issue in disputeTwenty-nine of the disputes were in jurisdiction. Of these, seven related to Promotion and Appointment, 15 related to Dismissals, four to Other ULP’s and three related to Interpretation of Collective agreements.

ULP- Promotion/App Other ULP Unfair Dismissal Interpretation /Application

Total

7 4 15 3 29

Events ConductedDuring the period under review a total of 176 events were conducted as follows:

Conciliation Arbitration Total

59 117 176

CondonationTwelve applications for condonation were received for the period under review. Of these, five were granted and seven were declined.

Dispute Outcomes

Withdrawn Conc

Settled Conc

Withdrawn Arb

Dismissed Arb

Settled Arb

Award Rendered

Total

7 2 6 7 9 18 49

During the period under review a total of 49 cases were finalised. A total of 18 disputes were finalised through arbitration (award rendered), nine were settled at arbitration, two at conciliation, seven were dismissed at arbitration, seven were withdrawn at conciliation and six were withdrawn at arbitration.

Postponements and adjournmentsDuring the period under review 10 requests for postponement were received and granted. There were six adjournments to matters which were convened for a hearing.

Cases carried over from previous financial yearsA total of 21 cases are being carried over to the 2015/16 financial year, five of these cases relate to the 2013/14 financial year.

Training and development servicesThe purpose of training and development is to improve the knowledge and quality of services for ELRC Panellists and Dispute Practitioners. For this reason, Panellists and Dispute Practitioners are being professionally trained and developed to keep abreast of new developments in the field of Labour Law and to improve the quality of arbitration awards.


Professional Development and Training Workshops for Panellists in 2014/15 financial yearDuring the period under review the ELRC conducted professional training and development for Panellists. The Council commenced its training of Panellists in the second quarter and a total of 43 Panellists attended the training workshop. The other workshop continued in the third quarter and a total of 51 Panellists attended. A total of 94 Panellists attended the training during the period under review. The focus of the training was on amendments to the LRA and the Employment of Educators Act, and rules governing proceedings and promotion disputes. Furthermore, the training was aimed at improving the quality of the Council’s Panellists by discussing relevant legislation, case law, new developments, and problematic issues in the education sector.

Professional Development and Training Workshops for Dispute Resolution Practitioners in 2014/15 financial yearDuring the 2014/15 financial year, the Council arranged training facilitated by the CCMA on Labour Law Amendments to Dispute Resolution Practitioners as follows:

•• National Office: 26 May 2014

•• North West: 13 June 2014

•• KwaZulu-Natal: 20 June 2014

•• Mpumalanga: 27 June 2014

•• Northern Cape: 4 July 2014

•• Free State: 25 July 2014

•• Western Cape: 11 July 2014

•• Gauteng: 1 August 2014

•• Eastern Cape: 08 August 2014

•• Limpopo: 29 August 2014

The Council has also - through the Nelson Mandela Metropolitan University (NMMU) - trained 20 CTU-ATU Dispute Resolution Practitioners on Substantive Law; Ethics and Social Justice; Managing dismissals; Unfair Labour Practices; and Labour Dispute Resolution.

Further trainings took place in KwaZulu-Natal on 15 and 16 January 2015 and in Limpopo on 20 and 21 January 2015. This training covered discipline, grievance, conciliation and arbitration processes. A total of 59 Dispute Resolution Practitioners were trained in this regard.

The purpose of the Dispute Practitioners Workshops is to ensure that all Parties to Council are able to effectively and efficiently represent cases that are referred to Council. The training for Dispute Resolution Practitioners is an important component of the dispute resolution function of the ELRC.


The programme focused on the improvement of the skills of practitioners, expanding the knowledge base of practitioners in so far as the case law in the education sector is concerned, and consolidating the understanding of practitioners in relation to the constitution of the ELRC. The programme also served as a platform for discussion on possible amendments to the ELRC constitution in relation to streamlining the dispute resolution procedure; focussing on effective dispute prevention and management. The need for the effective resolution of grievances in the workplace would ensure a significant decrease in the number of disputes referred to the ELRC; this would in turn contribute to a more stable education sector.


Collective Bargaining Services

AchievementsThe Council identified one evidence based teacher welfare and national development issue, which was the need to embark on research to address the conditions of service of ECD Practitioners in South Africa. Council had approved the Concept document “Policy and Conditions of Service for Institutionalisation of Grade R Practitioners” and has appointed a researcher to conduct the research in the 2015/16 financial year.

The Personnel Administrative Measures (PAM) task team concluded its work during the 2014/15 financial year. The Revised PAM has been recommended to the Minister for publication and the finalised document will be published and disseminated upon approval in the 2015/16 financial year. This is another triumph for Council, as this has been another long standing item on the agenda of Council.

“Treaty is born in the meeting room of camaraderie, where the desire for a quality education system triumphs above all and is echoed in every line of our mutual agreements.” B.L


3.3 Programme 3: Collective Bargaining Services

Programme 3.1: Collective Bargaining – National

PurposeThe purpose of Programme 3 is to contribute to the Council’s vision of a strengthened social contract between government, teacher unions and civil society that helps to create a conducive environment for improved quality in teaching and learning, by promoting collective bargaining at national and provincial levels, to ensure the development of effective policies for quality public education in a non-disruptive environment for teaching and learning.

Sub-programmesCollective Bargaining (Provincial)

Strategic Objectives

•• Collective bargaining

•• Research Services

•• Quality Learning and Teaching Campaign (QLTC)


Collective Bargaining Services: National


Actual Achievement

2013/14

Planned Target

2014/15

Actual Achievement

2014/15


target to Actual

Achievement for 2014/15


Collective Bargaining

Conclude bargaining on identified matters of mutual interest in public education

5 4 7 +3 Council Achieved the following:

Management Plan for Bargaining 2014/2015.

CA: Quality Management System (QMS)

Revised PAM was recommended to the Minister for publishing.

CA: Appointment of a Panel of Conciliators and Arbitrators

CA: The Process of Acquiring Organisational Rights in the Education Sector

1+4 Intervention Project

FETCBU submission




Actual Achievement

2013/14

Planned Target

2014/15

Actual Achievement

2014/15


target to Actual



Research Services

A report on the factors that promote labour peace, educator morale and wellbeing is available

Not Achieved 1 Not Achieved 100% Council approved the research concept document on the Policy and Conditions of Service for the Institutionalisation of Grade R Practitioners and the appointment of a researcher to conduct the research, but no report has been tabled at Council.

Quality Learning and Teaching Campaign (QLTC)

Establish and empower all-inclusive and functional QLTC structures on all levels i.e. provincial, district, circuit/ward and school levels

Not Applicable 27 13 14 The training of districts only commenced in the second quarter of 2014 and it impacted negatively on achievement of the set targets.

The reasons cited for non-achievement are: the uncertainty regarding the secondment of the Quality Coordinating Team (QCT) members; difficulties with the internal coordination of the QLTC within the DBE, and the breakdown of communication between the DBE and stakeholders on the functioning of the QCT.


Key Performance Indicators, planned targets and actual achievements



Actual Achievement

2013/14

Planned Target

2014/15

Actual Achievement

2014/15


target to Actual



Collective Bargaining

Bargaining concluded on identified matters of mutual interest

5 4 7 +3 Council Achieved the following:

•• Management Plan for Bargaining 2014/2015.

•• CA: Quality Management System (QMS)

•• Revised PAM was recommended to the Minister for publishing.

•• CA: Appointment of a Panel of Conciliators and Arbitrators

•• CA: The Process of Acquiring Organisational Rights in the Education Sector

•• 1+4 Intervention Project

•• FETCBU submission

Research Services

A report on the factors that promote labour peace, educator morale and wellbeing is available

Not Achieved 1 Not Achieved 100% Council approved the research concept document on the Policy and Conditions of Service for the Institutionalisation of Grade R Practitioners and the appointment of a researcher to conduct the research, but no report has been tabled at Council.




Actual Achievement

2013/14

Planned Target

2014/15

Actual Achievement

2014/15


target to Actual



Quality Learning and Teaching Campaign (QLTC)

All-inclusive and functional QLTC structures on all levels i.e. provincial, district, circuit/ward and school levels established

Not Applicable 27 13 14 The training of districts only commenced in the second quarter of 2014 and it impacted negatively on achievement of the set targets.

The reasons cited for non-achievement are: the uncertainty regarding the secondment of the Quality Coordinating Team (QCT) members; difficulties with the internal coordination of the QLTC within the DBE and the breakdown of communication between the DBE and stakeholders on the functioning of the QCT.

Performance Overview of Collective Bargaining Services: National for the 2014/15 financial yearCouncil achieved its objective to identify one evidence-based teacher welfare and national development issue: the need to embark on research to address the conditions of service of ECD Practitioners in South Africa. Council had approved the Concept document “Policy and Conditions of Service for Institutionalisation of Grade R Practitioners” and has appointed a researcher to conduct the research.

Thirteen delegates participated in the Annual Conference of International Labour Organisation (ILO) in Geneva, Switzerland from 28 May to 12June 2014.

The following Collective Agreements were concluded during the period under review:

•• Collective Agreement 1 of 2014: The Process of Acquiring Organisational Rights in the Education Sector.

The agreement provides a procedure for the acquiring of organisational rights for all unions organising in the Provincial Departments of Education and the Department of Basic Education.

•• Collective Agreement 2 of 2014: Quality Management System (QMS) for School Based Educators.

The agreement seeks to provide a standardised framework for employee performance for educators.

•• Collective Agreement 1 of 2015: Appointment of a Panel of Conciliators and Arbitrators.

The purpose of the agreement is to ensure the appointment of Panellists to perform disputes resolution functions for the ELRC.


The following Provincial Collective Agreements were ratified:

•• Mpumalanga Collective Agreement 1 of 2014: Transfer of Serving Educators in terms of Operational Requirements and permanent Appointment of Temporary Teachers in Vacant Substantive Posts.

The agreement seeks to provide procedures for the equitable distribution of educator posts and the transfer of educators affected by operational requirements. The primary objective of the agreement is also to provide a procedure for the permanent appointment of temporary teachers in vacant substantive posts.

•• KwaZulu-Natal Collective Agreement 1 of 2014: Procedure for dealing with the placement of Further Education and Training (FET) College Lecturers who remain in Employment with the Department of Education KwaZulu-Natal in terms of Collective Agreement Numbers 4 and 5 of 2007.

The purpose of the agreement is to identify those FET College lecturers who are currently unplaced as of 01 January 2013 and who opted to remain in employment with the KZN Department of Education.

•• KwaZulu-Natal Collective Agreement 2 of 2014: Framework and Guidelines for Implementation of Educator Incentives in KZN.

The purpose of the agreement is to create a framework and procedure for the effective implementation of the Determination on Teacher Incentives for Educators within the Department of Education in KwaZulu-Natal, which takes cognisance of prevailing challenges in the Province that impact on the identification and payment of such incentives.

•• Gauteng Collective Agreement 1 of 2014: Collective Agreement 1 of 2014 on the Conversion of Temporary Appointment of Post Level 1 Educators into Permanent Appointment.

The agreement clarifies and formalises the processes in terms of which post level 1 educators in substantive posts have their posts converted from temporary to permanent appointments in public schools.

•• North West Collective Agreement 1 of 2014: The Provincial Procedures for Principals Displaced as a Result of Rationalisation, Merger and/or Closure of Schools in giving effect to Collective Agreement 2 of 2003.

The aim of the agreement is to give effect to National Collective Agreement 2 of 2003 on the transfer of serving educators in terms of operational requirements in so far as principals are concerned. The agreement also seeks to regularise the redeployment of principals held additional to the staff establishment of schools due to closure, merger or rationalisation of schools.


Strategy to overcome areas of underperformanceThe following are the proposed recommendations for considerations by the QLTC Coordinators to ensure the training programme is strengthened:

•• Close cooperation between QCT and provincial Coordinators to be strengthened to achieve the set targets of districts to be

trained

•• The provincial coordinators to assist in the dissemination and advocacy of the training of districts and stakeholders

•• A need to compile accurate data of all QLTC structures and stakeholders



2014/15 2013/14

Programme Name Budget

Actual Expenditure

(Over)/Under Expenditure Budget

Actual Expenditure

(Over)/ Under

Expenditure

R’000 R’000 R’000 R’000 R’000 R’000

Collective Bargaining Services

National 4 891 3 169 1 722 4 864 3 448 1 416

Special Projects 2 100 612 1 487 1 179 1 797 (618)

CB Provincial 10 180 9 126 1 054 9 627 8 032 1 595

Dispute Prevention Support Services 10 209 0 10 209 11 211 8 805 2 406

Governance Support Services 1 721 1 177 544 1 754 1 149 605

Research Services 1 500 1 096 403 576 - 576

Total 30 602 24 028 6 574 29,211 23,231 5,980


Programme 3.2: Collective Bargaining – Provincial

PurposeThe purpose of the provincial chambers is to promote collective bargaining at provincial level to ensure the development of effective policies for quality public education in a non-disruptive environment for teaching and learning.

3.2.1 Eastern Cape

Key performance indicators, planned targets and actual achievements

Collective Bargaining Services: Eastern Cape


Actual Achievement

2013/14


Actual Achievement2014/15



2014/15


Consultation, Implementation and Monitoring of Collective Agreements and Policies

Post Provisioning

A consolidated report on the consultation process for post provisioning is available.

Achieved

Consolidated report available

Consultation meetings: MEC

22nd August 2013

26th September 2013

30th September 2013

Consultation meetings: HOD

04th September 2013

11th September 2013

4 Meetings Achieved

4 Meetings


None

Incentives for Educators

Monitoring reports on the implementation of incentives for educators are available.

Achieved

Monitoring reports available.

6 939 posts were earmarked for incentives in the province; 3 784 posts received incentives

(55%).

4 Meetings Achieved

4 Meetings


None


Overview of the Eastern Cape Chamber’s performance for the 2014/15 financial yearThe Eastern Cape Chamber convened and facilitated PPN 2015 consultation meetings on behalf of the MEC for Education as per its constitutional obligation. The consultation ended with a declaration by the MEC for Education of 55 796 posts for the academic year based on the last declaration of 2014.

Parties to the Chamber were not happy with the declaration, raising concerns relating to the problems caused by the previous declaration of 2014.

The administrative arm of the department is causing delays and frustrations as they do not fill in the posts as declared. The MEC for Education was sensitised to the problem and implored that the posts are filled in schools as declared, as this would contribute to a great improvement in education.

The Chamber established a task team that monitored the implementation of the 2015 Post Provisioning process. Teams of the Provincial Task Team (PTT) on the monitoring of PPN 2015 called cluster meetings at districts to monitor the implementation of PPN 2015. The reports have to be submitted formally to the Chamber for adoption.

The Dispute Prevention Task Team proposed a workshop on Appointments and Promotions and the workshop took place on the 20th of November 2014.

The Task Team further facilitated the establishment of the project on Policy on Incapacity Leave and Ill-Health Retirement (PILIR) cases that was then established by the Department in November 2014.

Strategy to overcome areas of underperformance

Not applicable.



2014/15 2013/14

Programme Name Budget Actual Expenditure

(Over)/Under

Expenditure


(Over)/Under

Expenditure

R’000 R’000 R’000 R’000 R’000 R’000

Collective Bargaining Services: Eastern Cape 1 133 970 163 29,211 23,231 5,980

Total 1 133 970 163 29,211 23,231 5,980


3.2.2 Free State


Collective Bargaining Services: Free State


Actual Achievement

2013/14

Planned Target

2014/15

Actual Achievement2014/15



2014/15



Post Provisioning


Achieved

Consultation was concluded and staff establishments issued on 13th September 2013.

4 Meetings Not Achieved

3 Meetings

1 Meeting The Employer was not ready to consult parties as the budget was not yet approved by the Provincial Treasury. As a result, the meeting had to be postponed to await finalisation of DoE internal processes.



Achieved

Monitoring reports available

935 posts were identified, however, due to transfers and farm school closure, the number reduced to 754.


3 Meetings

1 Meeting The Employer was in the process of conducting an audit to determine and verify the reality in terms of the actual beneficiaries of incentives.

Overview of the Free State Chamber’s performance for the 2014/15 financial yearThe chamber remained consistent in executing its mandate in accordance with the set annual performance targets.

The Post Provisioning Consultation process was concluded on 12 September 2014, and before 30 September 2014 staff establishments were issued to all schools in the province with an overall number of 20 710 posts allocated for 2015.

Subsequent to the distribution of 2015 post allocation to schools, the chamber monitored the placement of educators additional to establishments. Despite challenges experienced with the transfer of educators due to operational requirements, the department worked tirelessly and made strides in placing 1 236 out of 1 912 educators declared in excess - and that is a remarkable reduction.

A total of 325 temporary educators occupying substantive posts have been converted into permanent appointments in line with Free State Collective Agreement 1 of 2009. Reports also highlighted that 61 departmental and 148 Funza Lushaka bursary holders were placed as of 31 March 2015.


The chamber monitored progress on the implementation of incentives policy and noted that the number of beneficiaries may vary from time to time due to the closure of non-viable farm schools and subsequent transfers to schools in urban areas as well as excess educators transferred from public to farm schools. An audit was conducted to verify beneficiaries of incentives and audit findings revealed that the initial number before the audit was 774, which reduced to 749 as a result of allowances of 25 educators that were stopped due to transfers to public schools and termination of service.

Significant progress has been recorded in monitoring the implementation of the Integrated Quality Management System (IQMS) and Performance Management Development System (PMDS) in respect of training for newly appointed educators; coordinating performance management system to ensure compliance; and coordination of IQMS outcomes on PERSAL. A total of 22 617 (99.14%) educators on the payroll were paid 1% pay progression at the end July 2014, while 197 (0.86%) were not evaluated due to various reasons. With regard to PMDS, 98% of officials complied in line with the policy and were paid 1% pay progression. Status of compliance in relation to 2014/15 performance monitoring in terms of quarterly reviews of office-based educators showed slow progress and that was noted as a challenge.

The chamber monitored progress on implementation of Employee Health and Wellness Programs and reports presented highlighted statistics that showed involvement and full participation by educators.

The Dispute Prevention Committee played a major role in resolving grievances related to promotional posts and the identification and placement of excess educators. In an effort to resolve grievances before they escalate into potential disputes, the committee managed to minimise disruptions at the school level and that resulted in the promotion and maintenance of labour peace in the province.

An induction workshop conducted for Parties contributed positively in terms of capacitating new delegates and enhancing harmonious working relations within the Chamber.

Strategy to overcome areas of underperformanceThe Employer made a commitment to adhere to timeframes provided for in the Annual Performance Plan and to ensure that reports are submitted timeously to avoid postponing discussion on issues. The management plan will be developed with clear timelines to ensure there are no deviations in future.



2014/15 2013/14


(Over)/Under

Expenditure


(Over)/Under

Expenditure

R’000 R’000 R’000 R’000 R’000 R’000

Collective Bargaining Services: Free State 1 159 1 059 100 29,211 23,231 5,980

Total 1 159 1 059 100 29,211 23,231 5,980


3.2.3 Gauteng


Collective Bargaining Services: Gauteng


Actual Achievement

2013/14


Actual Achievement

2014/15



2014/15



Post Provisioning


Achieved

The Chamber meeting of 26th November 2014 endorsed the PPN and a circular implementing the Post Provisioning Norms.

500 Growth Posts were distributed.


2 Meetings

2 Meetings The understanding on the matter was that Chamber was supposed to adopt the Post Provisioning as tabled by the employer. The issue was clarified that the mere tabling and discussion on Post Provisioning did not satisfy our performance indicator.



Not Achieved

Chamber could not adopt a circular geared towards implementation of the policy. No posts were identified as a result.


0 Meetings

4 Meetings Parties did not agree to actualisation of the policy given its perceived implications. No meetings were convened as a result.

The release of a set of selection criteria by the Department of Basic Education will hopefully help guide the Province in the implementation of the Incentive for Educators Policy. The Chamber of the 4th Quarter agreed to set up a Task Team with a view to engage and check the feasibility of utilising the selection criteria from the National Department.


Overview of the Gauteng Chamber’s performance for the 2014/15 financial yearThe Gauteng province successfully maintained cordial labour relations that contributed to the Province reclaiming its number one position in the 2014 Matric Class. The Province was awarded an excellence award with its Secondary School Improvement Programme (SSIP) by the United Nations Organisation. The award is a great feat. The achievements in the schooling sector cannot be alienated from the Collective Bargaining Process.

In the last quarter of the academic calendar, Chamber contributed to the Gauteng Department of Education releasing a Circular on Post Provisioning. In the fourth quarter, Chamber received an update on the absorption of temporary educators in the Province, this is against the backdrop of Collective Agreement 1 of 2014. The conclusion of Collective Agreement 1 of 2014 was a resounding victory for workers in the education sector as it regulated the absorption of temporary educators with a minimum service of three months.

The Dispute Prevention Task Team is on the verge of concluding a Circular that will give expression to the notion of Progressive Discipline. The current review of Collective Agreement 2 of 2005 will see an improved recruitment system in promotional posts in the Province.

The AET (Adult Education and Training) migration was handled with care and courtesy. A Circular concluded in the Chamber on 28 November 2014 gave emphatic protection to employees in the sector.

The Consultative and Collective Bargaining Workshops have introduced numerous policy intentions for engagements in the Chamber. The MTEF process once more raised problematic areas with regard to the timing.

Strategy to overcome areas of underperformanceIncentives for Educators remain like a mirage. If discussions that took place in the Chamber of 31st March 2015 are anything to go by, possibilities exist for a favourable outcome in the first quarter of the 2015/16 financial year. The Province will look into the selection criteria advanced by the Department of Basic Education and emerge with a selection criteria that will possibly avoid dividing labour in the work places.

Post ProvisioningThe current Annual Performance Plan refers as it requires a report for each quarter. The Office shall work to cause the employer to be responsive to the expectation which will see each Chamber meeting receiving a report on Post Provisioning.



2014/15 2013/14





R’000 R’000 R’000 R’000 R’000 R’000

Collective Bargaining Services: Gauteng

1 180 1 066 114 29,211 23,231 5,980

Total 1 180 1 066 114 29,211 23,231 5,980


3.2.4 KwaZulu-NatalKey performance indicators, planned targets and actual achievements

Collective Bargaining Services: KwaZulu-Natal


Actual Achievement

2013/14


Actual Achievement

2014/15



2014/15



Post Provisioning


Achieved

Consultations were concluded on 12 September 2013


3 Meetings

1 Meeting No Chamber meeting held to receive report on the conclusion of consultation process and the issue of staff establishment to all schools. Chamber meeting had been convened during the fourth quarter to receive and analyse report. However, the Chamber meeting adjourned before report was adopted and discussed.



Achieved

Monitoring reports available.7 343 posts were earmarked for payment, and 100% were paid.


3 Meetings

1 Meeting A Chamber meeting was convened during the fourth quarter to deal with this report. However the meeting adjourned before the report had been adopted and discussed. During the fourth quarter, a report incorporating information on grievances in respect of outstanding payments to recipients, had been presented, adopted and discussed.

Overview of the KwaZulu-Natal Chamber’s performance for the 2014/15 financial yearThe Parties to the KZN Chamber remain firmly committed to contribute towards the Quality Learning and Teaching Campaign (QLTC). To this end, the KZN Chamber has adopted this campaign as the over-arching theme for all programmes of the Chamber.

It is pleasing to report that the performance of the KZN Chamber for the period under review had been a productive one.

With the exception of the third quarter, during which the Chamber meeting had been convened to discuss reports on the standardised pre-determined objectives but had adjourned before adopting and discussing the relevant reports, the objectives set for all other quarters were met.


Having fulfilled its mandate to deal with the standardised pre-determined objectives, the KZN Chamber dealt with a host of other issues which affect the delivery of education in KwaZulu-Natal. There were also some successful workshops convened during this period.

Report of Dispute Prevention Strategies The Dispute Prevention sub-committee had been established in the KZN Chamber over many years. This sub-committee continues to make a significant contribution towards promoting labour peace in the Province. For the period under review, the dispute prevention sub-committee met on the following occasions:

•• 27 August 2014

•• 29 October 2014

•• 08 December 2014

The work of the dispute prevention sub-committee also focussed on the need to host a comprehensive workshop on the Discipline of Educators. The parties to the Chamber formulated the content of this workshop which was refined and presented by Adv. Bono on 15 and 16 January 2015.

Amongst other issues dealt with by the dispute prevention sub-committee were:

•• Presentation and analysis of reports on grievances and misconduct – Employer

•• Presentation and analysis of report on Disputes – Provincial ELRC

•• Status of Provincial Collective agreement 2 of 2008 (Displaced educators)

•• Amendment to Departmental HRM circular 15 of 2011 (which dealt with the delegation of authority to school principals to

invoke discharge of educators)

•• Discussion and agreement on centralisation of grievance handling for promotion disputes

Additional items tabled and dealt with at Chamber some of which remain a work in progress (In respect of staffing issues):

•• Release and monitoring of school-based promotions posts (HRM 15 and 31 of 2014)

•• Release and monitoring of office-based posts

•• Criteria used to appoint security personnel at schools (Grant received from Department of Public works) and further funding

and utilisation of Grant from Department of Public works

•• Report back – HRM 26 of 2014 : Implementation of PPN for 2015

•• Placement of Fundza Lushaka Bursary holders

•• Identification and placement of protected temporary educators

•• Placement of FET remainees

In respect of Teacher Development:

•• Roll out and analysis of programmes: Winter and Spring classes; Teacher development programmes

•• Creation of a Teacher Development institute


Employee Morale Boosting Task Team Over time, organised labour had complained at the level of Chamber that their members had become demoralised due to the failure/significant delays in the Employer dealing with their queries. These queries related to amongst others, processing and payment of salaries, processing of leave applications, medical boarding, temporary incapacity leave, the delay in processing promotion appointments, etc. Chamber was unanimous that Educators are central to the delivery of QLTC and it did not bode well when they had become demoralised and unproductive due to a failure of the Employer processing their queries timeously or, not attending to their queries at all.

It was decided therefore, that an Employee Morale Boosting (EMB) task team would be created. The brief of this Task Team was to conduct field visits to all 12 District offices and the Employers Head office to meet with personnel who worked at these offices. The purpose of the meetings was to ascertain the nature, type and extent of challenges and problems encountered by District and Head Office personnel which in turn, had impeded service delivery to educators. To date, the EMB Task Team has conducted the followings District visits:

Date Location/Details

29 April 2014 Ulundi to visit Uthungulu District personnel currently stationed in Ulundi

13 May 2014 Visit to Empangeni as a follow up to meet with Uthungulu District personnel based at Empangeni

19 May 2014 visit to Umkhanyakude District

19 June 2014 Vsit to Dundee (to meet with personnel from Uthukela, Amajuba and Umzinyathi Districts)

22 August 2014 Visit to Sisonke to meet with Sisonke and Umgundgundlovu Districts

17 September 2014 Visit to Durban surrounding Districts (Illembe, Pinetown and Umlazi)

17 November 2014 Ulundi to visit Zululand District

18 November 2014 Visit to Ugu District

Fruitful discussions have taken place with Department personnel in all meetings held thus far. The last meeting between the EMB Task Team members and personnel from the Employers Head Office will be held by April/May 2015. Thereafter, a comprehensive report together with recommendation ns will be presented to Chamber for consideration.


Workshops held

Date Workshop

20 June 2014 Amendments to the LRA

13 and 14 October 2014 KZN Operational Planning workshop for 2015/16

15 October 2015 Implementation of PPN 2015

15 and 16 January 2015 Discipline of educators

31 March 2015 Induction of KZN Chamber representatives

Strategy to overcome areas of underperformanceA Chamber meeting was held and would have otherwise adopted reports on PPN and incentives for educators if it was not for the adjournment of the meeting whilst dealing with other matters. Therefore - and for the future - Parties must be urged to make every attempt to complete meetings to avoid adjournment or else if it is likely that the meeting would be adjourned, then every attempt must be made to reprioritise the agenda to ensure reports pertaining to the Annual Performance Plan on standardised objectives, are presented and adopted.

Chamber meetings should be scheduled with reserve days identified. This would ensure that if adjournments are unavoidable, then Chamber could be reconvened before the expiry of the reporting period to ensure reports are adopted and presented within the prescribed reporting period.



2014/15 2013/14




(Over)/Under

Expenditure

R’000 R’000 R’000 R’000 R’000 R’000

Collective Bargaining Services: KwaZulu-Natal

1 250 965 285 29,211 23,231 5,980

Total 1 250 965 285 29,211 23,231 5,980


3.2.5 Limpopo


Collective Bargaining Services: Limpopo


Actual Achievement

2013/2014


Actual Achievement

2014/2015



2014/2015



Post Provisioning


Achieved

A consolidated report on the consultation process for post provisioning is available


2 Meetings

2 Meetings Consultations were concluded and staff establishments had been issued to schools.

The issue of implementation reports has been referred to the task team.

In the first and second quarters of the year consultations could not take place as employee parties needed further clarity on e.g. subject weighting.

Parties agreed finally that the post establishment that was initially meant for implementation in 2014 would be implemented in 2015.

The consolidated report on distribution of post provision for 2015 was received and analysed by the chamber.



Achieved


The Limpopo Department of Education re-instated the payment of incentives to educators in June 2013; 319 schools were reinstated and 400 were outstanding.

4 Meetings Achieved

4 Meetings


None


Overview of the Limpopo Chamber’s performance for the 2014/15 financial yearThe Chamber achieved the standard objectives set for the 2014/15 financial year. Parties agreed that the post establishment that was initially meant for 2014 would be implemented in 2015 as the 2015 post establishment.

Additional achievementsChamber monitored the processing of PILIR applications from educators. From January to December 2014, the Limpopo Department of Education (LDoE) reportedly received 515 applications for various categories of PILIR cases.

Three Dispute Prevention Task Team meetings were held in three quarters in the period under review.

IQMS and PMDSThe implementation of IQMS and PMDS was monitored by chamber in all four quarters. Among others, the following were observed: Out of 41510 educators, 38990 (94%) qualified and were paid for their performance in terms of the IQMS instrument. For PMDS, out of the expected 909 educators, 850 educators (93.5%) submitted evaluation forms. A total of 797 (93.7%) of them qualified and were paid for their performance in line with the PMDS.

Merging of schoolsThe process for the merging of small and non-viable schools was reportedly ongoing. A total of 301 schools were identified for merging. The above figure includes 25 schools that objected to the process of merging. Out of the 60 merged schools, 33 had moved to the absorbing schools. A total of 21 schools were closed and removed from the register as reported, 68 schools were in need of scholar transport and 159 schools were in need of mobile classrooms.


Fundza LushakaThe employer also shared, in all four quarters, information on the number of educators produced by the Fundza Lushaka program. The last report in the fourth quarter indicated that 355 of the above-mentioned educators qualified for appointment, 157 (44%) of them were reportedly appointed by the LDoE, and two were appointed outside of the LDoE.

The filling of vacancy listsChamber monitored, on a quarterly basis, the filling of the 2012 and 2013 vacancy lists for principals, deputy principals and HOD posts at schools. In the 2012 and 2013 vacancy lists, 645 principals posts were reportedly available for filling and 629 (97.5%) of them were successfully filled. In the 2012 vacancy list for deputy principals, 210 posts were available for filling, 208 (99%) of them were successfully filled as reported.

In the 2012 vacancy list for HOD’s, 614 posts were available for filling, 613 (99.8%) of them were reportedly successfully filled. The process of monitoring the filling of the above-mentioned vacancy lists is on going.

Employee wellnessChamber monitored, on a quarterly basis, the successful implementation of various wellness programmes. The following are among observations made:

•• A total of 6471 employees were reached for purposes of marketing the wellness programmes

•• Breast Cancer Awareness, Condom Week, Candle light Memorial Day and World AIDS Day were observed

•• A total of 225 (100%) requests and referrals on HIV/AIDS and Employee Assistance Programme (EAP) were attended to

•• A total of 701 employees were provided with HCT (Health Care and Treatment)

•• A total of 301 cases relating to the compliance with the Compensation for Occupational Injuries and Diseases (COID) Act 130

of 1993 were also attended to

•• A total of 19900 condoms were distributed to employees

•• A total of 3045 educators were reached through medical screening; these educators were enlisted to be dealt with in terms

of the Occupational Health and Safety (OHS) Act.


School safetyA total of 3638 schools were reportedly linked with police stations nearest to them for purposes of maintaining safety and reducing crime in schools.

Strategy to overcome areas of underperformance It was agreed in the bilateral meetings of February 2014 that the PPN projected for the 2014 academic year would be implemented and monitored in 2015.

Changes to planned targets No changes were made to planned targets.


2014/15 2013/14





R’000 R’000 R’000 R’000 R’000 R’000

Collective Bargaining Services: Limpopo

1 225 1 056 169 29 211 23 231 5 980

Total 1 225 1 056 169 29 211 23 231 5 980


3.2.6 Mpumalanga


Collective Bargaining Services: Mpumalanga


Actual Achievement

2013/14

Planned Target

2014/15

Actual Achievement

2014/15


target to Actual Achievement for 2014/15



Post Provisioning


Achieved

Consultations were concluded on 29 October 2013


2 Meetings

2 Meetings The misunderstanding between the Employer and Organised Labour resulted in meetings being rescheduled.



Not Achieved

The employer did not present both the management plans and reports on the implementation of incentives for educators for monitoring by chamber.


1 Meeting

3 Meetings The employer was not conversant with the quarterly targets as set in the APP. Training was conducted during the period under review to ensure that the employer understands how to implement the policy in accordance with the quarterly targets in the APP.

Overview of the Mpumalanga Chamber’s performance for the 2014/15 financial yearThe Mpumalanga Chamber managed to handle all designated meetings as scheduled, which were in a position to handle reports and various agreements. Task Teams were established to address the following issues: Teacher Education; Employee Wellness; Learners with Specialised Educational Needs (LSEN); Employment Equity and Skills Development. The Task Teams are currently operational and are supported by all Parties serving in the Chamber. The Chamber is pleased to appraise party members for their consistent attendance and support to all chamber and task teams meetings that were called at times at the eleventh hour. Both the employer and employee Parties were able to deliberate with a common understanding on all matters.

The Chamber managed to receive; analyse and adopt reports on the post provisioning norms and teacher incentives, which confirms that 234 educators have been incentivised.

Parties were briefed and accepted reports on the implementation of Collective Agreement 1 of 2014 (translation of temporary educators into permanent status and transfer of educators held additional to staff establishment) with 2223 temporary educators translated into permanent status.


In monitoring the implementation of IQMS and PMDS, the chamber was briefed that in both respective collective agreements, 25 908 school-based and 520 office-based educators were evaluated and paid.

The Chamber was consulted and accepted the introduction of training programmes for principals such as Organisational Leadership, Continuing Professional Teacher Development (CPTD), Curriculum Management, Teachers Curriculum and Assessment Policy Statements (CAPS), Information and Communication Technologies (ICT) and Early Childhood Development Institute (ECDI) training for practitioners. In addition Sasol has been allowed to adopt four schools for an introductory technical programme, which will see the teaching of technical subjects prioritised.

Parties were also consulted and accepted the employment and re-employment of Grade R practitioners and a training programme aimed at improving their qualifications.

The province successfully conducted two workshops on amendments to the LRA and the strategic planning workshop for the 2015/16 annual performance plan and budget.

Parties shared information on the recruitment campaign of Grade 12 learners into the teaching profession, and challenges which impede the performance of the LSEN, Employee Health and Wellness (EHW) and Employment Equity (EE) Task Teams and recommendations to maximise the achievements of set goals.

Strategy to overcome areas of underperformanceThe standing committee has decided to strengthen induction and training so that all members are on the same level with chamber’s expectations and resolutions; hence a consultative meeting on the 2015/16 Annual Performance Plan in the form of a special chamber has been arranged for 7 May 2015.



2014/15 2013/14




(Over)/Under

Expenditure

R’000 R’000 R’000 R’000 R’000 R’000

Collective Bargaining Services: Mpumalanga

1 056 984 72 29 211 23 231 5 980

Total 1 056 984 72 29 211 23 231 5 980


3.2.7 Northern Cape


Collective Bargaining Services: Northern Cape


Actual Achievement

2013/14

Planned Target

2014/15

Actual Achievement

2014/15


target to Actual Achievement for 2014/15



Post Provisioning


Achieved

The process was concluded on time and on the 30th September the draft school establishments were issued to all schools within the province

4 Meetings Achieved

4 MeetingsA consolidated report on the consultation process for post provisioning is available.

None



Achieved

Monitoring reports availableOut of the 1472 incentive posts marked, 1 453 educators against those posts had been paid and the rest would have been paid by the end of the quarter (99%).

4 Meetings Achieved

4 MeetingsMonitoring reports on the implementation of incentives for educators are available.

None

Overview of the Northern Cape Chamber’s performance for the 2014/15 financial yearFollowing the finalisation of the Post Provisioning Consultation process, 8694 posts were distributed for the 2015 academic year.

Employee wellness and HIV/AIDS information sharing meetings were held where the Employer tabled programs of their directorates.

The Chamber also conducted a Dispute Resolution meeting where the Northern Cape Department of Education has been embarking on a dispute prevention strategy to ensure that disputes are minimised in the province. The Employer tabled the following programs: misconduct workshops to be conducted for principals, circuit managers and line managers. Labour forums were also established as they seek to draw closer relationships between the employer and labour Parties.


In a special Chamber, the Employer presented to Labour Parties a draft on Regulations on conditions of service for educators in the province and the meeting agreed that Labour Unions must go and make inputs on the regulations presented by the employer; the final draft will be adopted in the 2014/15 financial year.

On the 17th of November 2014, in a Chamber meeting, the employer reported that they would be converting 514 educators in the 2015 academic year. The employer reported that upon checking educators who qualify for conversion, they discovered that out of the initial 514 only 329 educators qualify for conversion and those educators were converted.

The Employer reported that the backlog of the 2013 financial year acting allowance has been paid fully and they are busy processing payment for the third quarter of the 2014 financial year. A total of 143 educators were paid their first and second quarter acting allowance for the 2014 financial year.

The Employer reported that on the implementation of Occupation Specific Dispensation (OSD) for Therapists, there has been no movement on the payment of OSD for Therapists and they are awaiting allocation of funds from the National DBE. The Employer also reported on IQMS payment that is outstanding in the province.

The Employer also reported on the education infrastructural grant (budget) and explained the aim of this grant which is to help accelerate construction, maintenance, upgrading and rehabilitation of new and existing infrastructure in education.

Educators also received reports on the termination of service. A total of 394 educators resigned in the province and 211 educators retired.

The Employer reported on long service leave encashment under two categories:

20 Years category 60 educators benefited

30 Years category 17 educators benefited

The Employer also presented a report on schools Quintile in the province and it was accepted by Chamber.

The Provincial Manager served in the provincial task team of the School Governing Body (SGB) Launch in 2015.

On 14 August 2014 in a chamber meeting, the Employer reported on the updated delivery management plan of LTSM (Learner Teacher Support Material) in the province per district and committed that by end of October 2014 all schools in the province would have received their LTSM and would report 100% delivery to Chamber.

A report on Curriculum activities planned for 2014 was presented in an information sharing meeting about the analysis of underperforming schools in the province, which are predominantly from the previously disadvantaged communities. The Senior Management Team (SMT) engagement with underperforming schools and curriculum roadshows were held and teacher development sessions were conducted for learner intervention winter camps. Telematics and spring camps were also hosted. The Employer also reported on the 1+4 model and it was decided in the meeting that as per Council’s decision, the Employer should go back to their principals to inform them about the 1+4 model.

The Teacher Development employer reported on progress made on CPTD (continuous professional teacher development) and an updated report on Broader Teacher Recognition was presented. The employer also reported on logistics related to advocacy programs in rural areas for Funza Lushaka bursaries for poor communities.


Strategy to overcome areas of underperformanceNot applicable.



2014/15 2013/14





R’000 R’000 R’000 R’000 R’000 R’000

Collective Bargaining Services: Northern Cape 1 046 1 039 7 29 211 23 231 5 980

Total 1 046 1 039 7 29,211 23,231 5,980


3.2.8 North West


Collective Bargaining Services: North West


Actual Achievement

2012/2013


Actual Achievement

2013/2014


target to Actual Achievement

for 2013/2014



Post Provisioning


Achieved

The consultation that occurred on 16th August 2013 agreed that the draft be sent to schools and that has been done.

4 Meetings Achieved

4 Meetings


None



Achieved


4 212 posts were identified and 3 435 received incentives

(82%).

4 Meetings Achieved

4 Meetings


None

Overview of the North West Chamber’s performance for the 2014/15 financial yearThe period under review witnessed numerous meetings held by the North West Chamber, which sought to respond to directives of the ELRC constitution as stipulated by sub-clause 21.1 to 21.5 of the Annexure A of the said constitution. Chamber and STANCO meetings were aimed at receiving, analysing and adopting reports on unique objectives such as: ill-health, rationalisation of schools; IQMS/PMDS; resignations of educators; QLTC; temporary educators; AET; advertising and filling of posts; payment of capped-leaves and pension pay-outs). The meetings also had to reflect on and endorse provincial ELRC reports and resuscitate the Task Team on Collective Agreement for Temporary Educators, with the view of reviewing the waiting period qualifying them to be permanent; and the feasibility of including other categories of temporary educators who were not accommodated by the Provincial ELRC Collective Agreement 1 of 2010.

The reports flowing from the Task Team meetings and workshops such as Amendments to the LRA 66 of 1995 and strategic planning were noted and appreciated by these meetings. The signing of the North West Provincial Collective Agreement 1 of 2014, which sought to mitigate challenges related to displaced principals as a result of merger and/or closure of schools, including the preparations for a successful strategic planning held during October 2014, also found expression at these meetings.


One of the most critical and commendable works executed by Chamber is a decision seeking to identify a fixed pay-date of December salaries for educators, given that the pay-date for the said month is determined by the date of school-closure. The other observation that prompted this decision, is the notion that purports that during the festive season, there is a tendency of impulsive spending and transactions, which subsequently translate into adverse socio-economic consequences. Thus it was resolved that educators should receive their December salaries on the 20th from 2014 going forth.

The North West PELRC held four Task Team meetings on Dispute Prevention, and the tasks thereof were to receive and reflect on national and provincial ELRC, as well as that of the Employer, with the view of analysing them for the purpose of developing strategies congruent to sub-clauses 22.1 and 22.2 of Annexure A of the ELRC constitution urging, the Chamber “to maintain and promote labour peace “and “to mutually prevent and resolve labour disputes”.

In an attempt to advance the QLTC imperatives, promote labour peace in the education sector and marketing the ELRC, the Chamber honoured invitations from Parties where delegates were addressed on the modus operandi of the ELRC including labour related matters, such as misconduct, handling and management of disputes, grievances and cases and leave-measures. The Council was also represented at the Provincial QLTC meetings, and the programmes and information shared at these meetings are committal and resolute towards improvement of the quality of public education in North West. Other programmes that supports this commitment are, amongst others, the monitoring of examination processes and re-opening of schools; linking schools to police stations with the view of intensifying safety and security at schools; Letsema Cleaning; Campaigns War at Occult; Homework Assistant pilot programme; establishment of QLTC ward structures and Anti-Drug-Abuse campaigns.

ELRC material and survey questionnaires were distributed at some of the functions mentioned above. Parties to the North West Chamber gained valuable insights from the CCMA workshop held on 13th June 2014, which was aimed at alleviating frustrations endured by both Labour and the Employer across the sectors, by revisiting the applications of organisational rights; picketing; essential service; recession and review of awards - including the definition of temporary service.

Parties also participated in the strategic planning session held on 27 and 28 October 2014. The purpose of the session was to review the performance of the North West Chamber, with the view of realigning the Annual performance Plan (APP) with the budget for the 2015/16 financial year.




2014/15 2013/14




(Over)/Under

Expenditure

R’000 R’000 R’000 R’000 R’000 R’000

Collective Bargaining Services: North West 1 064 964 100 29,211 23,231 5,980

Total 1 064 964 100 29,211 23,231 5,980


3.2.9 Western Cape


Collective Bargaining Services: Western Cape


Actual Achievement

2013/14

Planned Target

2014/15

Actual Achievement

2014/15

Deviation from planned target

to Actual Achievement for 2014/15



Post Provisioning


Achieved

Consolidated report available

4 Meetings Achieved

4 Meetings


None



Achieved


1 301 permanent posts were marked to receive incentives, 1 085 received incentives (83%).


3 Meetings

1 Meeting One meeting not held during the third quarter of the period under review.

A report was submitted at the meeting held on the 4 March 2015 .

Overview of the Western Cape Chamber’s performance for the 2014/15 financial yearIn addition to achievement of the standardised objectives, the Chamber also achieved the following:

Employment Equity (EE)Employment Equity Consultative Forum (EECF) meetings were held quarterly and reports were presented on the progress made on EE targets. The Forum also serves as a platform where EE challenges are discussed and addressed. Quarterly EECF meetings took place. Quarterly EE scores for the period 1 April 2014 to 31 March 2015 were compiled and provided to the Directorate: Recruitment & Selection and Districts for further dissemination. A Disability Focus was brought into the fourth quarterly meeting of 2015, with a presentation from a disability expert relating to fears and prejudices towards disability. Gender Equality and Job Access Strategic Implementation Framework Reports for the period 1 July to 31 December 2014 were compiled, signed off by the Secretary General (SG) and submitted to the Department of Public Service and Administration (DPSA) at the end of February 2015.


Skills DevelopmentThe Monitoring and Public Service Sector Education and Training Authority (PSETA) Expenditure report was submitted to PSETA and relevant stakeholders for the period under review in line with the policies and procedures. The Western Cape Education Department’s Skills Development committee meetings were held regularly with the purpose of presenting implementation reports by the various Training Committees and Project Managers. The SG approved 20 In-Service Personnel Public Service Bursaries and the incumbents had an induction session. The Graduate Internship Programme currently has 17 interns in the programme and will continue until the end of March 2015. Pre-service educator bursaries were made available to 97 educators and are ongoing. The continuation and format is however under discussion.

Integrated Quality Management System (IQMS)Training on the IQMS for all first-time appointees was conducted by Performance Management (PM) Co-ordinators in each district. The due date for all baseline evaluations was 13th March 2015.

The circular minute on the “Importance of Sound Performance Management”, including management calendars for the IQMS, PMDS and Staff Performance Management and Development System (SPMDS) was disseminated on 9th March 2015.

All outstanding queries, particularly those cases resulting in educators being “in-between” salary notches have been resolved. Most pay progression queries for education therapists have been finalised.

Previous 2014 Pay Progression Queries

Nature of queries Number of cases Status

“In-between notches” 372 Resolved

Education Therapists, Psychologists & Councilors 168 Resolved

Office-based 14 Resolved

Further Education and Training Institute (FETI) 23 Resolved

TOTAL 577 Resolved

Quality Management System (QMS): Due to incomplete discussions nationally on the proposed QMS the current status for IQMS remains.

Whole School Evaluation (WSE)During the period under review WSE was conducted at one hundred and forty nine schools (149). These types of schools were High, Primary, Intermediate, Combined, Independent and Special Schools. Urgent findings were escalated to EXCO and the relevant Chief Directorates for follow-up action. Some of the strengths at functional schools are

•• An orderly and structured environment is created in the schools

•• Priorities are addressed in the School Improvement Plans (SIPs)

•• All policies and documents have been reviewed to ensure relevance to the schools’ context

•• LTSM is utilised to address the shortcomings highlighted in internal and external assessments

•• There is incremental improvement in learner performance in the external assessments


Some weaknesses were also identified which were amongst others, but not limited to the following:

•• Measures to improve the attendance rates of learners and teachers are ineffective

•• Although there are strategies to improve curriculum delivery, effective monitoring of implementation does not take place

•• The School Governing Bodies (SGBs) sub-committees are not functional and do not meet regularly

•• Learners’ computer skills are not developed as a result of under or non-utilisation of libraries and computer laboratories

•• Although educators present lessons in class, there is no reflection and consolidation of lessons

•• Interventions are ineffective as a result of inadequate follow up in subjects with unsatisfactory results

Employee Health and Wellness (EHW)

Employee Health and Wellness Operational Plans for 2015/16 were compiled and submitted to DPSA on 31 March 2015.

The following is a summary of the annual report submitted by the wellness service provider in respect of the utilisation of services for individual cases for the period 1 to 28 February 2015.

Case Management Activities

E-mail 52.2%

Task 40.2%

Phone Call 7.3%

The following is a summary of the annual report submitted by the wellness service provider in respect of the overall utilisation of services for the period 1 April 2014 – 31 March 2015

1. Cases attended - 188

2. Utilisation rate of 3.7%.

The following table summarises the types of services used by Western Cape Education Department (WCED) employees:

Services utilised Services utilised

Professional Counselling 66.3%

Life management 9.9%

Referral services 13.9%

Managerial service 9.9%

The following is a summary of the top five psycho-social issues employees experienced during the annual reporting period:

Psycho-social issues Cases attended

Relationship Issues 17.1%

Stress 14.6%

Trauma 12.2%

Mental Illness 8.1%

Legal Issues 8.1%


Transformation and Restructuring

The Department has 262 educators at ordinary public schools in excess as of 2 March 2015.

•• 124 educators have been declared in excess

•• 138 educators still to be declared in excess

The Directorate: Strategic People Management monitors the placement of excess educators on a monthly basis and provides the list of excess educators not yet placed to district offices through the office of the Chief Director: Districts.

The Department was provided with an initial list of 859 Funza Lushaka bursars for placement in 2015. The Department of Basic Education informed the WCED that 111 of 859 Funza Lushaka bursars have not completed their studies in 2014 (still to be verified by DBE). The WCED managed to place 455 (61%) out the 748 Funza Lushaka bursary holders that completed their studies in 2014 as of 2 March 2015.

The WCED is currently verifying the status of unplaced Funza Lushaka bursars, which may further reduce the number of eligible Funza Lushaka bursary holders for placement in the Western Cape.

Placement of bursary holders graduating in 2014

Employment status Number of FL Bursary holders placed

% Placed

Permanent 267 36%

Temporary 188 25%

Total 455 61%

The Directorate: Strategic People Management monitors the placement of Funza Lushaka bursary holders on a monthly basis and communicates the status of placements and provides a list of non-placements to district offices through the office of the Chief Director: Districts.

Conversion of Temporary Educators to Permanent was yet again addressed and the following represents the statistics as of 25 February 2015:

Total summary placements to date (approved appointments)

Category Number of Approved appointments

Total Excess Placed 57

Total number of FL Bursars (6A) 337

Total number of new entrants (6A) 630

Total number of Final Year Students (6A) 556

Total number of 6B Conversions 358

Total 1938

VL2 Nominations approved 257

Grand total 2195


National Teaching Awards (NTA)The advert for recruitment of employee appointed adjudicators has been circulated to stakeholders. The Directorate forwarded the draft provincial timelines, indicating important milestones as well as dates for provincial steering committee meetings for 2015 to all stakeholders on 11 November 2014. A successful mentoring session was held from 12 to 13 December 2014 in Arniston to prepare finalists for the national adjudication process that took place from 18 – 25 January 2015 in Isando. The National Teaching Awards Ceremony was held on the 7th of March 2015 at the Gallagher Convention Centre in Midrand, Gauteng. Two of the provincial finalists were awarded the following accolades:

•• Second place in Excellence in Special Needs and Inclusive Teaching

•• Third place in Excellence in Secondary School Leadership

The WCED has started with preparations for the 2015 process; however it is awaiting direction from the DBE on the 2015 process.

Safety at SchoolsSafety and Security measures were provided to 82% of the CSMs projects that have been completed. The rest of the projects are at various stages of completion. Holiday security was provided to schools for the period from 12 December 2014 to 21 January 2015. A total of 448 schools received 24-hour or 12-hour guarding. This decision is driven by the Safety Committee and SGB. During the period October 2014 to February 2015, a total of 61 schools were supported with emergency security as a result of burglary or vandalism or whilst school infrastructure was being repaired. Schools were also allocated emergency security to address the challenges presented by gangsterism and service delivery protests. Schools are being assisted by the district Safe Schools Coordinators with safety plans and assessments and safety and security audits to limit and manage security gaps.

Educators and learners are supported through various programmes that positively impact on their attitudes and discipline. The Safe Schools Fieldworkers (SSFW’s) under the guidance of the Safe Schools Coordinators, assist with holiday and after school programmes where learners are engaged in developmental programmes and participative programmes across the province throughout the year. The SSFW’s have also successfully assisted to re-integrate truant learners to school and in so doing have assisted the province to address the drop-out rate and improve school retention numbers and the number of successful learners. This also assists to keep learners from joining gangs as they are now back in school and positively engaged.

The following was achieved:

1. More than 10 972 learners had access to after-school and holiday programmes during the period October 2014 to January 2015. A further 4 868 learners participated in special events, such as the 16 Days of Activism programme.

2. Substance abuse training was offered to 72 schools, which equated to 559 educators and 1021 learners being trained.

3. A total of 618 educators were trained in the anti-bullying programme – the programme is on-going.

4. A further 16 schools were trained in the Occupational Health and Safety Act – these were mainly principals and the school safety officer; the training is on-going.

5. A total of 539 learners were tested for substances, of which 239 (44.3%) tested positive for a substance, mainly dagga and tik. The learners were supported through referrals by the Safe Schools Call Centre and are able to continue their schooling.

6. The Safe Schools Fieldworkers, as part of their job description, conducted home visits to 501 learners in October and December 2014 and 370 (74%) were reintegrated back to school.

The Safe Schools Call Centre, which forms an integral part of the Safe Schools Programme especially in crisis management, support and advice, received 1 173 calls during the period October to December 2014. A total of 815 cases were logged, which entailed referrals and the intervention of various intra and inter departments to support the learners and educators as well as the school.


Schools are benefitting from the School Local Police Station link. A total of 1 526 cases (verified) have been linked to their local police station. Schools are encouraged to add the contact number of their South African Police Service (SAPS) Sector Commander to their list of emergency telephone numbers. The SAPS, through the Sector Commanders conduct random visits to schools. School Safety Marshalls (SSMs) are deployed at 154 schools.

Incentives: Remoteness Incentives for Educators

The Department implemented the remoteness incentives for educators in 2012. The criteria to identify schools to receive the remoteness incentives were developed in consultation with employee parties. The remoteness incentives are currently paid to 286 schools and the expenditures incurred over the last three financial years were as follows:

Expenditure on remoteness incentives for educators

Financial year Expenditure incurred Number of teachers receiving incentives

2012/2013 R 20 174 334 1161

2013/2014 R 20 679 510 1117

2014/2015 R 22 780 195 1145

A report on the impact of the remoteness incentives to the 286 schools with regards to terminations, appointments and vacancy rate for the reporting periods above, will be completed by 31 March 2015. Provincial Departments were also requested to submit inputs for the draft incentive policy, which was signed by the Head of Education on 10 March 2015. Based on collaborative discussions between the WCED and employee parties in the education sector, the extension of the remoteness incentive policy provision to hard-to-teach schools will also be considered in the 2015/2016 financial year. The following criteria are supported in identifying schools to be categorised as hard-to-teach schools where the following is prevalent:

a. Violence, crime and gangsterism making conditions unsafe at a school and on route

b. Schools where educators are subject to physical or unacceptable and on-going verbal assault by learners and/or their property (e.g. cars) is damaged. This does not include isolated incidents, only areas where there are on-going problems should be considered.




2014/15 2013/14

Programme Name





R’000 R’000 R’000 R’000 R’000 R’000

Collective Bargaining Services: Western Cape 1 063 1 017 46 29,211 23,231 5,980

Total 1 063 1 017 46 29,211 23,231 5,980


4. SUMMARY OF FINANCIAL INFORMATION

4.1 Revenue Collection

2014/15 2013/14

Sources of revenue

Estimate ActualAmount

Collected

(Over)/Under Collection

Estimate ActualAmount

Collected

(Over)/Under Collection

R’000 R’000 R’000 R’000 R’000 R’000

Levies 48 000 49 212 ( 1 213) 48 000 49 298 (1 298)

Total 48 000 49 212 ( 1 213) 48 000 49 298 (1 298)


4.2 Programme Expenditure

2014/15 2013/14

Programme Name Budget ActualExpenditure


Budget ActualExpenditure


R’000 R’000 R’000 R’000 R’000 R’000

Dispute Management Services 10 115 12 712 (2 597) 9 201 7 931 1 270

Collective Bargaining Services 30 602 24 028 6 574 29 211 23 231 5 980

Executive Services 4 493 3 772 721 7 070 4 848 2 222

Corporate Services 12 764 12 938 174 13 117 10 824 2 293

Capital Expenditure 9 820 2 859 6 961 7 521 545 6 976

Total 67 794 56 309 11 485 66 120 47 379 18 741

4.3 Capital investment, maintenance and asset management planNot Applicable.

Strategy to overcome areas of underperformanceNot Applicable.

Changes to planned targetsNot Applicable.

HOPE

FUTURE

DEDICATION

SUCCESSPart CGovernance


1. INTRODUCTION

The overall performance of the Council for the 2014/15 financial period in terms of national collective bargaining activities indicates significant improvement, compared to the 2013/14 financial period, as the collective bargaining process was supported by Parties and three important national collective agreements were concluded. Collective bargaining at provincial level also improved considerably during the period under review.

In terms of Dispute Management Services, the Council implemented a number of measures to deal with disputes in a proactive manner, including the recruitment of interpreters and intermediaries to ensure speedy resolution of cases involving the child as a victim or a witness and a draft Collective Agreement on Guidelines for Promotion Arbitrations, which will assist the Council to reduce disputes related to promotions and appointments.

2. PORTFOLIO COMMITTEES

Dates of Meetings

Meeting Date

ELRC Budget Review and Strategic Plan (2015/16-2019/20) and Annual Performance Plan (2015/16)

24 March 2015

ELRC Annual Report Briefing for 2013/14 16 October 2014

3. EXECUTIVE AUTHORITY

The following reports were submitted to the Executive Authority during the period under review:

Quarterly Reports 2014/2015

Reports Submission Date

1st Quarter Report 30 July 2014

2nd Quarter Report 30 October 2014

3rd Quarter Report 3 February 2015

4th Quarter Report 30 April 2015

ELRC Strategic Plan (2015/16 to 2019/20) and Annual Performance Plan (2015/16) •• Submitted on 30th January 2015

Annual Report 2013/14•• Submitted on 28th August 2014


4. THE ACCOUNTING AUTHORITY

Committees

Committee No. of meetings held No. of members Name of members

Executive Committee 11 10 Department of Basic EducationMr A W KutumelaMs S GeyerMr R PretoriusMr S FakerMs K J MoshotleSADTUMr N DolopiMr M GaloraleMr M NdouvhadaCTU-ATUMr H HendricksMr D Lerm

Audit Committee 5 5 Ms T G MoeengMr M MahongaMr SA NgobeniMr M MalulekeMr N Maluleka

Finance Sub Committee 6 9 Department of Basic EducationMr S TshabalalaMs S GeyerMr M MahlareMr A W KutumelaSADTUMr S ThwalaMr S MogapiMr M JacobsCTU-ATUMr D LermMr N Mosia

Human Resources Sub Committee

4 7 Department of Basic EducationMs L MundayMr N NgcoboSADTUMr M GaloraleMr B ShanduMs K FrankCTU-ATUMr A V DlaminiMr N Mosia


Committee No. of meetings held No. of members Name of members

Legal Sub Committee 2 10 Department of Basic EducationMs KJ MoshotleMs S GeyerMr S TshabalalaMr R PretoriusMr A W KutumelaSADTUMr T SematleMr O SibiyaMr M NdouvhadaCTU-ATUMs C LotteringMr C Scorgie

5. RISK MANAGEMENT

Risk management is recognised as an integral part of sound organisational management. Risk management in the ELRC derives its mandate from the Public Finance Management Act (PFMA).

The Public Finance Management Act stipulates in section 38 that:

“The accounting officer of a public entity must ensure that the entity has and maintains:

i. Effective, efficient and transparent systems of financial and risk management and internal control; and

ii. A system of internal audit under the control and direction of an audit committee.”

In line with best practices, the governance structures are in place to ensure effective management of risk at both strategic and operational level.

Management has designed and implemented a risk management system. The system is documented in the ELRC Risk Management Policy. The policy has been developed to achieve maximum integration of the risk management process in normal business processes.

Risk management has been incorporated into the performance management system of the Council, as well as quarterly reporting to the Audit Committee.

The Risk Management Committee held two meetings and one risk management workshop during the period under review, where the identification, categorisation and ranking of risks were completed. Detailed operational risk registers were also updated quarterly.

The top risks as identified by Risk Owners are prioritised in terms of their importance and are being managed and reported on accordingly.

Key controls and mitigation strategies/plans have been identified and are being implemented for both strategic and operational risks to ensure that risks are kept within Council’s acceptable levels.


6. INTERNAL CONTROL

The Executive Committee, through its appointed Audit Committee, is accountable for ensuring implementation of appropriate internal controls which are reviewed regularly for efficiency and effectiveness, taking into account the risk profile of the Council. These controls are designed to manage the risk profile, and provide reasonable assurance that there is an adequate system of internal controls in place.

During the financial year, the Internal Audit unit played a vital role in facilitation of audits conducted by the Auditor-General South Africa (AGSA). The Internal Audit unit managed the administration of audit queries issued by the AGSA and developed action plans to address weaknesses identified in the final management report of the AGSA for the previous financial year. The unit followed up on the implementation of the action plans to address weaknesses and reported progress on the implementation of the action plans to the Audit Committee.

The Internal Audit unit also performed compliance reviews on compliance with the applicable laws and regulations, financial policies and prescripts in the form of audit engagements and compliance checklists. The consolidated Regulatory Compliance Universe and Business Compliance Universe were developed; and compliance management is reported quarterly.

7. INTERNAL AUDIT AND AUDIT COMMITTEE

Internal AuditDuring the financial year ended 31 March 2015, an in-house internal audit function was established. The internal audit operates within the framework of the Institute of Internal Auditors (IIA) under the direction of the Audit Committee, which approved the Internal Audit Charter, Three-year Internal Audit Rolling Plan, and Annual Internal Audit Plan. The Internal Audit Plan was informed by strategy and key risks that may impair the realisation of strategic objectives and goals. The operational plan is updated annually to ensure that it is responsive to changes in the business.

The internal audit functionally reports to the Audit Committee and administratively to the General Secretary. Internal audit is responsible for the overall preparation and execution of the risk-based audit plan and for coordinating the internal audit service. It therefore evaluates and contributes to the improvement of risk management, internal control and governance systems.

The ELRC Management is ultimately accountable for the Council’s systems of internal controls. These controls are designed to provide reasonable assurance regarding the achievement of the Council’s objectives concerning the effectiveness and efficiency of operations, reliability of financial reporting, and compliance with applicable laws and regulation.

Findings by internal audit are reported to the Audit Committee at each scheduled meeting. In addition, follow-up audits are conducted in areas where significant control weaknesses are found to ensure that mitigating strategies are adequately and effectively implemented by management.

Audit CommitteeThe Audit Committee of the ELRC is independent and fulfils a vital role in corporate governance by amongst others, ensuring the integrity of integrated reporting and internal financial controls and the management of risk.

The Committee has adopted appropriate formal terms of reference as its Audit Committee Charter, which have been approved by the EXCO. The Committee has also regulated its affairs in compliance with the Charter and has discharged its responsibilities as contained therein. The Audit Committee is an advisory committee of the Council operating with an independent and objective stance.


The Audit Committee met five times during the period under review (four normal meetings and one special meeting). The Committee holds office for three years.

The Committee’s meetings were attended by the General Secretary or her delegate, the internal auditor, the Chief Financial Officer (CFO), Senior Management and representatives from the office of the AGSA.

The Audit Committee reports that it has operated and performed its oversight responsibilities independently and objectively in compliance with section 38(1) (a) of the PFMA and Treasury Regulations 3.1.13.

The system of internal control applied by the Council over financial and risk management is effective. In line with the PFMA and the King III Report on corporate governance requirements, internal audit provides the Audit Committee and management with assurance on the appropriateness and effectiveness of the internal controls. This is achieved by means of the risk management process, as well as the identification of corrective actions and suggested enhancements to the controls and processes.

From the 2013/14 report of the AGSA, it was noted that there were some matters reported that indicated material deficiencies in internal control. There was concerted effort and hard work from management and officials to implement the agreed action plans. However, a number of control deficiencies were reported by the internal auditors during the period under review. Despite these control inadequacies, the Audit Committee is of the view that the system of internal control on financial statements was satisfactory.

8. COMPLIANCE WITH LAWS AND REGULATIONS

The Audit Committee monitors, on a quarterly basis, compliance with laws and regulations as part of the quarterly review of the performance of the entity.

9. FRAUD AND CORRUPTION

A Fraud Prevention Plan (FPP) for the ELRC has been revised and approved by the Audit Committee at the time that a risk assessment was done. A fraud and corruption policy statement exists and is signed by the Accounting Officer.

A tasks and responsibilities matrix for implementation of the FPP has been developed with components and areas. A fraud prevention strategy still has to be developed and approved.

10. MINIMISING CONFLICT OF INTEREST

At the beginning of each calendar year, all staff are required to sign a declaration form on conflict of interest.


11. CODE OF CONDUCT

The employee is obliged to immediately report to the Accounting Officer the following acts of fellow employees, officials and/or representatives of Council and/or any other person:

•• Theft

•• Fraud

•• Malicious damage to Council property

•• Abuse of Council property or facilities

•• Other criminal act(s)

If the acts as contemplated above apply to the conduct of the Accounting Officer, then the employee is obliged to report such to the EXCO. Other than the acts above, the employee accepts that the General Secretary is the Accounting Officer of the Secretariat and shall, upon instruction of the Accounting Officer and/or Council, account for any function of the Secretariat to a prescribed forum.

An employee who is found to have breached the ELRC’s Code of Conduct will face disciplinary action as set out in the HR Policy.

12. HEALTH SAFETY AND ENVIRONMENTAL ISSUES

Occupational health and safety in the ELRC is aimed at: the promotion and maintenance of the physical health of employees; the protection of workers in their employment from risks resulting from factors adverse to health; and the placing and maintenance of the worker in an occupational environment adapted to their physiological and psychological capabilities.

Occupational health focuses on three main objectives:

(i) The maintenance and promotion of workers’ health and working capacity

(ii) The improvement of the work environment to become conducive to safety and health

(iii) The development of work organisations and working cultures in a direction, which supports health and safety at work, and in doing so also promotes a positive social climate and smooth operation which can enhance productivity

13. SOCIAL RESPONSIBILITY

Staff members are encouraged to participate in social responsibility activities. During the year under review, donations were made on 18 July 2014 to the Mohau Children’s Centre in Attridgeville, Pretoria.


14. AUDIT COMMITTEE REPORT

We are pleased to present our report for the financial year ended 31 March 2015. The Audit Committee commends the management and staff of the ELRC for the efforts demonstrated during the period under review to ensure improvement in the performance of the entity.

Audit Committee Members and AttendanceThe Audit Committee consists of the members listed hereunder and meets at least four times per annum as per its approved terms of reference. During the current year, five meetings were held.

Name of member Designation Date of appointment Meetings Meetings

Scheduled Attended

Ms T Moeeng Chairperson (Member) August 2012 5 4

Mr M Maluleke Member August 2012 5 1

Mr M Mahonga Member August 2012 5 5

Mr SA Ngobeni Member June 2013 5 3

Mr N Maluleka Member August 2012 5 4

Audit Committee ResponsibilityThe Committee has adopted appropriate formal terms of reference as its Audit Committee Charter, which have been approved by the Executive Committee. The Committee has also regulated its affairs in compliance with the Charter and has discharged its responsibilities as contained therein. The Audit Committee is an advisory committee of the Council, operating with an independent and objective stance.

The audit committee met five times during the period under review. Committee members hold office for a period of three years.

The Committee’s meetings were regularly attended by the General Secretary or her delegate, internal auditor, the chief financial officer (CFO), senior management and representatives from the office of the AGSA.

The Audit Committee reports that it has operated and performed its oversight responsibilities independently and objectively in compliance with section 38(1) (a) of the PFMA and Treasury Regulations 3.1.13.

The system of internal control applied by the Council over financial and risk management is effective. In line with the PFMA and the King III Report on corporate governance requirements, internal audit provides the Audit Committee and management with assurance on the appropriateness and effectiveness of the internal controls. This is achieved by means of the risk management process, as well as the identification of corrective actions and suggested enhancements to controls and processes.

From the 2013/14 report of the AGSA, it was noted that there were some matters reported that indicated material deficiencies in internal control. There was concerted effort from management and officials to implement the agreed action plans. However, a number of control deficiencies were reported by the internal auditors during the period under review. Despite these control inadequacies, the Audit Committee is of the view that the system of internal control on financial statements was satisfactory.


The Effectiveness of Internal ControlThe Executive Committee, through its appointed Audit Committee, is accountable for ensuring implementation of appropriate internal controls which are reviewed regularly for efficiency and effectiveness; taking into account the risk profile of the council. These controls are designed to manage the risk profile and provide reasonable assurance that there is an adequate system of internal controls in place.

During the financial year, the Internal Audit unit played a vital role in the facilitation of audits conducted by the office of the Auditor-General. The Internal Audit unit managed the administration of audit queries issued by the AGSA and developed action plans to address weaknesses identified in the final management report of the AGSA for the previous financial year. It followed up on the implementation of the action plans to address weaknesses and reported the progress on the implementation of the action plans to the Audit Committee.

The Internal Audit unit also performed compliance reviews on compliance with the applicable laws and regulations, financial policies, and prescripts in the form of audit engagements and compliance checklists. The consolidated Regulatory Compliance Universe and Business Compliance Universe were developed, and compliance management is reported quarterly.

A Risk Management Committee chaired by the Chief Financial Officer was established and reported to the Audit Committee on various risks and measures to mitigate them.

Our review of the findings of the Internal Audit work was based on the risk assessment conducted and found weaknesses in the following areas:

1. Ineffective Supply Chain Management controls over its processes

2. Lack of adequate IT governance framework which serve as a basis for defining IT processes, managing IT process risks, and mapping the processes against defined standards and policies

3. Portfolio of evidence not timeously submitted


The Internal audit work was planned and completed during the year under review and the findings are summarised as follows:

1. Collective Bargaining Services

General non-compliance with certain provisions of the Committee Work Procedures manual.

2. Financial Disciplinary Review•• Finance policy and procedures manual needs improvement

•• Gaps identified in the process of levy collection

•• Ineffective budget monitoring controls

3. Performance Information•• Performance targets not achieved and not meeting the SMART criteria

•• Portfolio of evidence not submitted timeously

•• Minutes of meetings submitted for annual reporting are not signed

4. Dispute Management Services•• Lack of proper internal controls over records management system

5. Information Technology •• Lack of adequate IT governance framework, which serve as a basis for defining IT processes, managing IT process

risks, and mapping the processes against defined standards and policies

6. Human Resources Management•• High sick leave statistics

7. Supply Chain Management•• Standard operating procedures manual for SCM processes is still in draft form

•• Rotation of suppliers/service providers still poses a challenge

•• Inadequate controls over contract management

•• Inadequate assets management policy

•• Integrity of the fixed asset register cannot be confirmed

•• Lack of adequate controls over the disposal of assets identified as redundant and obsolete

•• Gaps identified in the handling of incoming invoicing processes

•• Adherence to turnaround times for invoice handling is a challenge


In-Year Management and Quarterly ReportThe entity has submitted quarterly reports to the Executive Authority and the Audit Committee has reviewed such reports.

Evaluation of Financial Statements

The Audit Committee:

•• Reviewed the audited annual financial statements prepared by the entity

•• Reviewed and discussed the unaudited annual financial statements to be included in the annual report with the Auditor-

General and the Accounting Officer

•• Reviewed changes in accounting policies and practices

•• Reviewed the information on predetermined objectives to be included in the annual report

•• Reviewed significant adjustments resulting from the audit

•• Reviewed the Annual Report

•• Reviewed the Auditor-General’s report

Auditor’s ReportWe have reviewed the entity’s implementation plan for audit issues raised in the prior year and we are satisfied that the matters have been adequately resolved except for the issues relating to the following:

1. Supply Chain Management2. Strategic Objectives

The Auditor-General’s Management ReportThe management report of the Auditor-General was reviewed.


Conclusion and FindingThe Audit Committee concurs and accepts the Auditor-General of South Africa’s conclusions on the annual financial statements and is of the opinion that the audited annual financial statements be accepted and read together with the report of the auditor.

RecommendationThe Audit Committee recommends the adoption of the audited financial statements and the Annual Report by EXCO.

–––––––––––––––––––––––––Ms T Moeeng, Chairperson of the Audit CommitteeDate: 30 July 2015

HOPE

FUTURE

DEDICATION

SUCCESSPart DHuman Resource Management


1. INTRODUCTION

The Human Resources report summarises the employment relations activities of the ELRC during the period 01 April 2014 to 31 March 2015. Human Resource issues include: recruitment, resignations (turnover), vacancies, Employment Equity, personnel expenditure, training expenditure, skills development, and labour relations.

The Council had 57 approved positions and reviewed the organogram as there was a need for personnel in the Internal Audit Department and Corporate Services (IT section).

Following the Work-Study Project that was conducted in the 2013/14 fiscal year, it was recommended that a Total Reward Strategy, Salary Benchmarking and Remuneration Policy be established to ascertain if the employees of the Council were remunerated in line with market standards. A service provider was identified and results were implemented accordingly with effect from 01 April 2015.

Recruitment/AppointmentsWith the revised organogram, the Council has 58 positions with a staff complement of 51 employees and seven vacant positions.

Of the seven vacant positions, six will be filled in the first quarter of the 2015/16 financial year. The remaining position will be filled during the course of the year.

Industrial RelationsOne employee was served with a written warning for poor performance during the period under review.

One employee lodged a dispute with the CCMA against the Council for unfair labour practice. The employee wanted the Council to pay for their studies, which were not related to their duties. This is related to payment for a skills development course.

The matter was finalised at the CCMA in the second quarter. The Senior Commissioner confirmed that the Council did not commit an unfair labour practice within the meaning of section 186(2) (a) of the Act against the applicant. The Commissioner issued an award in favour of the Council. No unfair labour practice was conducted by the Council as per section 186(2) (a) of the Act.

The Recognition Agreement was signed by the Council and the National Education Health and Allied Workers’ Union (NEHAWU). The status as at the end of the 2014/15 financial period, is that the Council awaits the bank stamped form and a list of their employee members from NEHAWU for deduction purposes.

SKILLS AND TRAINING DEVELOPMENTA total number of 53 employees attended training during the financial year 2014/15 viz: Occupational Health and Safety, Financial Reporting, Caseware, Supply Chain Management, and other courses related to their daily operations.

Organisational DevelopmentThe Annual Performance Assessments were successfully conducted and will be finalised in the first quarter of 2015/16 financial year.

During the financial year 2014/15, the Council conducted four wellness events for each quarter.


Resignations/RetirementSix employees resigned during the 2014/15 financial year and this was due to better remuneration offered by other employers in the market and career progression.

Highlights

•• The Total Reward Strategy, Remuneration Strategy and Policy was approved by EXCO and will be implemented with effect

from 01 April 2015.

•• Only two positions are vacant and will be filled in the 2015/16 financial year.

•• Bursaries were obtained for three employees to the value of R90 000.00 from ETDPSETA.

2. HUMAN RESOURCE OVERSIGHT STATISTICS

Personnel expenditure for the financial year 2014/2015.

Personnel cost by programme

Programme

Total Expenditure for the entity

(R’000)

Personnel Expenditure

(R’000)

Personnel exp. as a %

of total exp. (R’000)

No. of employees

Average personnel

cost per employee

(R’000)

Collective Bargaining 24 028 8 471 14% 22 385

Dispute Resolution 12 712 2 572 4% 4 643

Corporate Services 12 938 6 712 11% 21 319

Executive Services 3 772 2 233 4% 4 558

Total 56 309 19 989 33% 51 1 905

Personnel cost by salary band

Level

Personnel Expenditure

(R’000)

% of personnel exp. to total

personnel cost (R’000) No. of employees

Average personnel cost per employee

(R’000)

Top Management 1 443 7% 2 721

Senior Management 2 693 14% 3 898

Professional qualified 7 978 39% 14 569

Skilled 6 988 35% 26 269

Semi-skilled 482 2% 2 240

Unskilled 405 2% 4 102

Total 19 989 100% 51 2 799


Performance Rewards

ProgrammePerformance

rewardsPersonnel

Expenditure (R’000)

% of performance rewards to total personnel cost

(R’000)

Top Management 53 1 443 3,67%

Senior Management - 2 693 0,00%

Professional qualified 198 7 978 2,55%

Skilled 199 6 988 2,85%

Semi-skilled 22 482 4,57%

Unskilled 17 405 4,19%

Total 489 19 989 2,47%

Training Costs

Programme

Personnel Expenditure for the entity

(R’000)

Training Expenditure

(R’000)

Training expenditure

as a % of personnel cost

No. of employees

trained

Average training cost

per employee.(R’000)

Collective Bargaining 8 471 80 0,94% 11 7

Dispute Resolution 2 572 28 0,45% 11 3

Corporate Services 6 712 66 0,78% 14 5

Executive Services 2 233 61 2,32% 17 4

Total 19 989 235 1,19% 53 19

Employment and vacanciesEmployment levels per program

Programme

2013/14 2014/2015 Approved

Posts

2014/2015 2014/2015

% of Vacancies

No. of employees

No. of Employees Vacancies

Executive Office 5 4 4 0 0%

Collective Bargaining 22 23 22 1 4%

Corporate Services 12 24 21 3 13%

Dispute Resolution & Prevention 5 6 4 2 33%

Total 44 57 51 6 11%


Employment and vacancies per level

Programme

2013/14 2014/2015 Approved

Posts

2014/2015 2014/2015

% of Vacancies

No. of employees

No. of Employees Vacancies

Top Management 1 2 2 0 0%

Senior Management 2 4 3 1 25%

Professional qualified 13 16 14 2 13%

Skilled 22 29 26 3 10%

Semi-skilled 3 2 2 0 0%

Unskilled 3 4 4 0 0%

Total 44 57 51 6 11%

Employment changes

Salary Band

Employment at beginning of

period Appointments Terminations Transfers

Employment at end of the

period

Top Management 1 1 0 0 2

Senior Management 2 2 1 0 3

Professional qualified 13 2 1 0 14

Skilled 22 8 4 0 26

Semi-skilled 3 0 0 0 3

Unskilled 3 0 0 0 3

Total 44 13 6 0 51

Reasons for staff leaving Reason Number % of total no. of staff leaving

Death 0 0%

Resignation 6 11%

Dismissal 0 0%

Retirement 0 0%

Ill health 0 0%

Expiry of contract 0 0%

Other 0 0%

Total 6 11%


Labour Relations: Misconduct and disciplinary actionNature of Disciplinary Action Number

Verbal Warning 0

Written Warning 1

Final Written warning 1

Dismissal 0

Total 2

Equity Target and Employment Equity Status Levels MALE

African Coloured Indian White

Current Target Current Target Current Target Current Target

Top Management 1 0 0 0 0 0 0 0

Senior Management 2 0 0 0 0 0 0 0

Professional qualified 6 0 0 0 1 0 0 0

Skilled 11 0 0 0 0 0 0 0

Semi-skilled 2 0 0 0 0 0 0 0

Unskilled 3 0 0 0 0 0 0 0

Total 25 0 0 0 1 0 0 0

Levels FEMALE

African Coloured Indian White

Current Target Current Target Current Target Current Target

Top Management 1 0 0 0 0 0 0 0

Senior Management 1 0 0 0 0 0 0 0

Professional qualified 4 0 2 0 0 0 1 0

Skilled 12 0 1 0 1 0 1 0

Semi-skilled 0 0 0 0 0 0 0 0

Unskilled 1 0 0 0 0 0 0 0

Total 19 0 3 0 1 0 2 0

Levels DISABLED STAFF

Male Female

Current Target Current Target

Top Management 0 0 0 0

Senior Management 0 0 0 0

Professional qualified 0 0 0 0

Skilled 0 0 1 0

Semi-skilled 0 0 0 0

Unskilled 1 0 0 0

TOTAL 1 0 1 0

HOPE

FUTURE

DEDICATION

SUCCESSPart EFinancial Information


Report of the External Auditor

Report of the Auditor-General to Parliament on the Education Labour Relations Council

Report on the financial statements

Introduction 1. I have audited the financial statements of the Education Labour Relations Council (ELRC) set out on pages 100 to 136,

which comprise the statement of financial position as at 31 March 2015, the statement of financial performance, statement of changes in net assets, cash flow statement and the statement of comparison of budget information with actual amounts for the year then ended, as well as the notes, comprising a summary of significant accounting policies and other explanatory information.

Accounting authority’s responsibility for the financial statements 2. The accounting authority is responsible for the preparation and fair presentation of these financial statements in accordance

with South African Standards of Generally Recognised Accounting Practice (SA Standards of GRAP) and the requirements of the Public Finance Management Act of South Africa, 1999 (Act No.1 of 1999) (PFMA) and for such internal control as the accounting authority determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor-General’s responsibility 3. My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in

accordance with International Standards on Auditing. Those standards require that I comply with ethical requirements, and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

4. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

5. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion.

Opinion 6. In my opinion, the financial statements present fairly, in all material respects, the financial position of the ELRC as at 31

March 2015 and its financial performance and cash flows for the year then ended, in accordance with the SA Standards of GRAP and the requirements of the PFMA.


Emphasis of matters 7. I draw attention to the matters below. My opinion is not modified in respect of these matters.

Restatement of corresponding figures 8. As disclosed in note 15 to the financial statements, the corresponding figures for 31 March 2014 have been restated as

a result of an error discovered during 2014-15 in the financial statements of the department at, and for the year ended, 31 March 2014.

Delisting from PFMA 9. As disclosed in note 25 to the financial statements, the ELRC was delisted in terms of the PFMA and was to operate in terms

of the Labour Relations Act, 1995 (Act 66 of 1995) (as amended) as from 1 April 2015.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS 10. In accordance with the Public Audit Act of South Africa, 2004 (Act No. 25 of 2004) and the general notice issued in terms

thereof, I have a responsibility to report findings on the reported performance information against predetermined objectives for selected programmes presented in the annual performance report, non-compliance with legislation as well as internal control. The objective of my tests was to identify reportable findings as described under each subheading but not to gather evidence to express assurance on these matters. Accordingly, I do not express an opinion or conclusion on these matters.

Predetermined objectives 11. I performed procedures to obtain evidence about the usefulness and reliability of the reported performance information

for the following selected programmes presented in the annual performance report of the public entity for the year ended 31 March 2015:

•• Programme 2: Dispute Management Services pages 28 to 37

•• Programme 3: Collective Bargaining Services pages 38 to 71.

12. I evaluated the reported performance information against the overall criteria of usefulness and reliability.

13. I evaluated the usefulness of the reported performance information to determine whether it was presented in accordance with the National Treasury’s annual reporting principles and whether the reported performance was consistent with the planned programmes. I further performed tests to determine whether indicators and targets were well defined, verifiable, specific, measurable, time bound and relevant, as required by the National Treasury’s Framework for managing programme performance information (FMPPI).

14. I assessed the reliability of the reported performance information to determine whether it was valid, accurate and complete.

15. The material findings in respect of the selected programmes are as follows:


Programme 2: Dispute Management Services

Usefulness of reported performance information

Measurability of indicators 16. Performance indicators should be well defined by having clear definitions so that data can be collected consistently and

is easy to understand and use, as required by the FMPPI. A total of 33% of the indicators were not well defined in that clear, unambiguous data definitions were not available to allow for data to be collected consistently. The measurability of planned indicators could not be assessed due to a lack of technical indicator descriptions and formal standard operating procedures and documented system descriptions.

Programme 3: Collective Bargaining Services

Usefulness of reported performance information

Measurability of indicators 17. Performance targets should be specific in clearly identifying the nature and required level of performance, as required

by the FMPPI. A total of 83% of the targets were not specific in clearly identifying the nature and the required level of performance. This was due to management not fully understanding the requirements of the FMPPI.

Additional matters 18. I draw attention to the following matters:

Achievement of planned targets 19. Refer to the annual performance report on pages 24 to 91 for information on the achievement of the planned targets for

the year. This information should be considered in the context of the material findings on the usefulness of the reported performance information for the selected programmes reported in paragraphs 11 to 17 of this report

Compliance with legislation

20. I performed procedures to obtain evidence that the public entity had complied with applicable legislation regarding financial matters, financial management and other related matters. My findings on material compliance with specific matters in key legislation, as set out in the general notice issued in terms of the PAA, are as follows:

Annual financial statements 21. The financial statements submitted for auditing were not prepared in accordance with the prescribed financial reporting

framework, as required by section 55(1 )(a) of the PFMA. Material misstatements of property plant and equipment, trade and other payables, cash flow statement, prior period error note, commitments and irregular expenditure identified by the auditors in the submitted financial statements were subsequently corrected, resulting in the financial statements receiving an unqualified audit opinion.


Procurement and contract management 22. Goods and services with a transaction value below R500 000 were procured without obtaining the required price

quotations, as required by treasury regulation 16A6.1.

Expenditure management 23. The accounting authority did not take effective steps to prevent irregular expenditure and fruitless and wasteful expenditure,

as required by section 51(1) (b) (ii) of the PFMA.

Internal control24. I considered internal control relevant to my audit of the financial statements, annual performance report and compliance

with legislation. The matters reported below are limited to the significant internal control deficiencies that resulted in the findings on the annual performance report and the findings on compliance with legislation included in this report.

Financial and performance management 25. The entity did not maintain accurate and complete records of property, plant and equipment, trade and other payables

information throughout the year to support financial information reported in the financial statements. As a result, a considerable effort was made at year-end to correct the financial statements in this regard.

26. Although the entity improved its internal controls over the reliability of performance reporting, improvement is still required in the articulation of performance indicators to ensure compliance with the requirements of the FMPPI.

27. The entity’s system to monitor compliance with applicable legislation was not always effective. Non-compliance with laws and regulations could have been prevented had compliance been properly reviewed and monitored.

Pretoria 31 July 2015


EDUCATION LABOUR RELATIONS COUNCIL(Registration number LR2/6/6/110)

FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 MARCH 2015


Education Labour Relations CouncilFinancial Statements for the year ended 31 March 2015

Index Page

Statement of Responsibility for the Annual Financial Statements for the year ended31 March 2015 99

Statement of Financial Position 100

Statement of Financial Performance 101

Statement of Changes in Net Assets for the year ended 31 March 2015 102

Cash Flow Statement for the year ended 31 March 2015 103

Accounting Policies 104 - 116

Notes to the Financial Statements for the year ended 31 March 2014 117 - 135

Detailed Statement of Financial Position 136


Education Labour Relations CouncilFinancial Statements for the year ended 31 March 2015

STATEMENT OF RESPONSIBILITY FOR THE ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2015

The Accounting Authority is responsible for the preparation of the public entity’s annual financial statements and for the judgements made in this information.

The Accounting Authority is responsible for establishing, and implementing a system of internal control designed to provide reasonable assurance as to the integrity and reliability of the annual financial statements.

In my opinion, the financial statements fairly reflect the operations of the public entity for the financial year ended 31 March 2015.

The external auditors are engaged to express an independent opinion on the AFS of the public entity.

The Education Labour Relations Council’s annual financial statements for the year ended 31 March 2015 have been audited by the external auditors and their report is presented on page 93.

The Annual Financial Statements of the public entity set out on page 100 to page 136 have been approved.

______________________________

N.O FocaAccounting Officer

______________________________

Adv. L BonoChairperson of Council


Statement of Financial Position as at 31 March 2015

March 2015 March 2014

Notes R R

Assets

Current Assets 137,986,399 129,467,594

Other receivables from exchange transactions 2 1,445,495 2,270,878

Cash and cash equivalents 3 136,540,904 127,196,716

Non-Current Assets 10,197,584 7,695,416

Property, plant and equipment 4 9,894,082 7,296,418

Intangible assets 5 303,502 398,998

Total Assets 148,183,983 137,163,010

Net Reserves and Liabilities

Net Assets 68,501,713 63,668,686

Building reserves fund - 7,185,918

Capital reserve fund - 1,376,649

Dispute resolution fund - 5,000,000

Training, development and research - 3,382,538

Accumulated surplus/(deficit) 68,501,713 46,723,581

Current Liabilities 53,151,501 53,850,007

Payables from exchange transactions 6 3,778,434 3,384,845

Operating lease liability 7 101,917 75,302

Provisions 8 49,271,150 50,389,860

Non-Current Liabilities 26,530,769 19,644,317

Long-term payables (shop stewards) 9 26,530,769 19,644,317

Total Liabilities 79,682,270 73,494.324

Total Net Reserves and Liabilities 148,183,983 137,163,010


Statement of Financial Performance for Period ended 31 March 2015

DescriptionNotes

31 March 2015R

31 March 2014R

Revenue 56,488,460 55,018,286

Exchange revenue 49,212,798 49,321,956

Levies 10 49,212,798 49,321,956

Other Income 7,275,662 5,696,330

Sundry income 10 240,401 62,237

Interest income 10 7,035,261 5,634,093

Expenditure (51,578,595) (45,335,547)

Personnel related expenses 11 (19,988,962) (15,549,561)

Administration expenses 12 (6,423,575) (5,540,099)

Depreciation and amortisation 4,5 (1,244,725) (1,065,176)

Repairs and maintenance (734,685) (692,846)

General expenses 13 (23,186,648) (22,487.865)

Gains/(losses) on disposal of assets and liabilities (76,838) (246,446)

Surplus/(deficit) for the period ending 31 March 2015 4,833,027 9,436,293


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Statement of Cash Flows as at 31 March 2015

Notes31 March 2015

R31 March 2014

R

Cash flows from operating activities

Receipts 56,488,460 54,566,240

Levies 10 49,212,798 48,932,147

Other income 10 240,401 -

Interest income 7,035,261 5,634,093

Payments (50,206,991) (56,217,752)

Employee related costs (19,988,962) (15,549,561)

Suppliers (30,218,029) (40,668,191)

Net cash flows from operating activities 15 6,281,469 (1,651,512)

Cash flows from investing activities

Purchase of property, plant and equipment 4 (3,863,732 (415,243)

Purchase of other intangible assets 5 - (129,776)

Proceeds from sale of assets 39,999 -

Net cash flows from investing activities (3,823,733) (545,019)

Cash flows from financing activities 6,886,452 19,644,317

Movement in other liabilities 9 6,886,452 19,644,317

Net increase/(decrease) in cash and cash equivalents 9,344,188 17,447,786

Cash and cash equivalents at the beginning of the year 127,196,716 109,748,930

Cash and cash equivalents at the end of the year 3 136,540,904 127,196,716


Accounting Policies

1. Presentation of financial statements

1.1 Basis of preparationThe annual financial statements have been prepared in accordance with the Standards of Generally Recognised Accounting Practice (GRAP) including any interpretations, guidelines and directives issued by the Accounting Standards Board in accordance with Section 55 (1) (b) of the Public Finance Management Act (PFMA Act No. 1 of 1999 as amended).

These annual financial statements have been prepared on an accrual basis of accounting and are in accordance with historical cost convention unless specified otherwise. They are presented in South African Rand, which is the ELRC functional currency. Amounts in the financial statements are rounded to the nearest Rand.

During the period under review, the following GRAP Standards were adopted by the ELRC:

•• GRAP 25 – Employee benefits

The adoption of these newly effected GRAP standards did not have a significant impact on the financial statements as the principles are similar to those already applied under these standards - which were already applied in the presentation of financial statements.

Judgments, estimates and assumptionsThe preparation of the financial statements in conformity with GRAP requires management to make judgment, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, revenue and expenses. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an on-going basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected.

Going concern The financial statements are prepared on the assumption that the entity is a going concern and will continue in operation for the foreseeable future.

A summary of the significant accounting policies, which have been consistently applied, are disclosed below.

1.2 Property, plant and equipmentProperty, plant and equipment are tangible non-current assets (including infrastructure assets) that are held for use in the production or supply of goods or services, rental to others, or for administrative purposes, and are expected to be used during more than one period. This excludes investment property.

The cost of an item of property, plant and equipment is the purchase price and other costs attributable to bring the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. Trade discounts and rebates are deducted in arriving at the cost.


The cost of an item of property, plant and equipment is recognised as an asset when:

•• It is probable that future economic benefits or service potential associated with the item will flow to the entity; and

•• The cost of the item can be measured reliably.

Property, plant and equipment are initially measured at cost.

Where an asset is acquired at no cost, or for a nominal cost, its cost is its fair value as at the date of acquisition.

Where an item of property, plant and equipment is acquired in exchange for a non-monetary asset or monetary assets, or a combination of monetary and non-monetary assets, the asset acquired is initially measured at fair value (the cost). If the acquired item’s fair value was not determinable, its deemed cost is the carrying amount of the asset(s) given up.

When significant components of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

Costs include costs incurred initially to acquire or construct an item of property, plant and equipment and costs incurred subsequently to add to, replace part of, or service it. If replacement cost is recognised in the carrying amount of an item of property, plant and equipment, the carrying amount of the replaced part is derecognised.

The initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located is also included in the cost of property, plant and equipment, where the entity is obligated to incur such expenditure, and where the obligation arises as a result of acquiring the asset or using it for purposes other than the production of inventories.

Recognition of costs in the carrying amount of an item of property, plant and equipment ceases when the item is in the location and condition necessary for it to be capable of operating in the manner intended by management.

Property, plant and equipment are depreciated on a straight line basis over their expected useful lives to their estimated residual value.

Property, plant and equipment are carried at cost less accumulated depreciation and any impairment losses. The useful lives of items of property, plant and equipment have been assessed as follows:

Item Average useful life in years

Buildings 25

Furniture and fittings 10

Motor vehicles 7

Office equipment 8

Computer equipment 8

The residual value, and the useful life and depreciation method of each asset are reviewed at the end of each reporting date. If the expectations differ from previous estimates, the change is accounted for as a change in accounting estimate.

Reviewing the useful life of an asset on an annual basis does not require the entity to amend the previous estimate unless expectations differ from the previous estimate.

Each part of an item of property, plant and equipment with a cost that is significant in relation to the total cost of the item is depreciated separately.

The depreciation charge for each period is recognised in surplus or deficit unless it is included in the carrying amount of another asset.


Items of property, plant and equipment are derecognised when the asset is disposed of, or when there are no further economic benefits or service potential expected from the use of the asset.

The gain or loss arising from derecognition of an item of property, plant and equipment is included in the surplus or deficit when the item is derecognised. The gain or loss arising from derecognition of an item of property, plant and equipment is determined as the difference between the net disposal proceeds, if any, and the carrying amount of the item.

1.3 Intangible assetsAn asset is identified as an intangible asset when it:

•• Is capable of being separated or divided from an entity and sold, transferred, licensed, rented or exchanged, either individually

or together with a related contract, assets or liability;

•• Arises from contractual rights or other legal rights, regardless of whether those rights are transferable or separate from the

entity or from other rights and obligations.

An intangible asset is recognised when:

It is probable that the expected future economic benefits or service potential attributable to the asset will flow to the entity; and the cost or fair value of the asset can be measured reliably.

Intangible assets are initially recognised at cost.

An intangible asset is regarded as having an indefinite useful life when, based on all relevant factors, there is no foreseeable limit to the period they are tested for impairment annually and whenever there is an indication that the asset may be impaired. For all other intangible assets, amortisation is provided on a straight-line basis over their useful life.

The amortisation period and the amortisation method for intangible assets are reviewed at each reporting date.

Reassessing the useful life of an intangible asset with a finite useful life after it was classified as indefinite, is an indicator that the asset maybe impaired. As a result, the asset is tested for impairment and the remaining carrying amount is amortised over its useful life.

Internally generated brands, mastheads, publishing titles, customer lists and items similar in substance are not recognised as intangible assets.

Amortisation is provided to write down the intangible assets, on a straight line basis, to their residual values as follows:

Item Average useful life in years

Computer software 8

An intangible asset is derecognised when the asset is disposed of or when there are no economic benefits or service potential from the use of the asset.


1.4 Financial instrumentsA financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or a residual interest of another entity.

The amortised cost of a financial asset or financial liability is the amount at which the financial asset or financial liability is measured at initial recognition minus principal repayments, plus or minus the cumulative amortisation using the effective interest method of any difference between that initial amount and the maturity amount; and minus any reduction (directly or through the use of an allowance account) for impairment or uncollectibility.

1.4.1 Risk Management of financial assets and liabilitiesCredit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation.

Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates.

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates.

Liquidity risk is the risk encountered by an entity in the event of difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset.

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: currency risk, interest rate risk and other price risk.

Other price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices (other than those arising from interest rate risk or currency risk), whether those changes are caused by factors specific to the individual financial instrument or its issuer, or factors affecting all similar financial instruments traded in the market.

1.4.2 Initial measurement of financial assets and financial liabilitiesThe entity measures a financial asset and financial liability initially at its fair value plus transaction costs that are directly attributable to the acquisition or issue of the financial asset or financial liability.

1.4.3 Subsequent measurement of financial assets and financial liabilitiesThe entity measures all financial assets and financial liabilities after initial recognition using the following categories:

•• Financial instruments at fair value

•• Financial instruments at amortised cost

All financial assets measured at amortised cost, are subject to an impairment review.


1.4.4 Impairment and uncollectibility of financial assetsAt the end of each reporting period, the entity assess whether there is any objective evidence that a financial asset or group of financial assets is impaired.

Financial assets measured at amortised cost:

If there is objective evidence that an impairment loss on financial assets measured at amortised cost has been incurred, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the financial asset’s original effective interest rate. The carrying amount of the asset is reduced directly or through the use of an allowance account. The amount of the loss is recognised in surplus or deficit.

If in a subsequent period the amount of the impairment loss decreases, and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed directly or by adjusting an allowance account. The reversal does not result in a carrying amount of the financial asset that exceeds what the amortised cost would have been had the impairment not been recognised at the date the impairment is reversed. The amount of the reversal is recognised in surplus or deficit.

1.5 Financial assets and liabilities ELRC‘s principle financial assets are trade and other receivables, cash, and cash equivalents.

ELRC‘s principle financial liabilities are trade and other payables and an operating lease.

1.5.1 Trade and other receivablesTrade and other receivables are classified as financial assets at amortised cost. A provision for impairment of trade receivables is established when there is objective evidence that the entity will not be able to collect all amounts due, according to the original terms of receivables.

1.5.2 Cash and cash equivalentsCash and cash equivalents comprise cash on hand and deposits held at call with banks. Cash and cash equivalents are classified as financial assets at amortised cost.

1.5.3 Trade and other payablesTrade and other payables are classified as financial liability at amortised cost.

1.5.4 Derecognition

1.5.4.1 Derecognition of financial assetsThe entity derecognises a financial asset only when:

•• The contractual rights to the cash flows from the financial asset expire, are settled or

•• waived

•• The entity transfers to another party substantially all of the risks and rewards of ownership of the financial assets


•• The entity, despite having retained some significant risks and rewards of ownership of the financial asset, has transferred

control of the asset to another party; and the other party has the practical ability to sell the asset in its entirety to an unrelated

third party and is able to exercise that ability unilaterally and without needing to impose additional restrictions on the transfer.

1.5.4.2 Derecognition of financial liabilityThe entity derecognises financial liabilities when, and only when, the entity’s obligations are discharged, cancelled or they expire.

1.6 LeasesA lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership. A lease is classified as an operating lease if it does not transfer substantially all the risks and rewards incidental to ownership.

When a lease includes land and building elements, the entity assesses the classification of each element separately.

1.6.1 Operating leases as the lesseeOperating lease payments are recognised as an expense on a straight-line basis over the lease term. The difference between the amounts recognised as an expense and the contractual payments are recognised as an operating lease asset or liability.

1.6.2 Finance lease as the lesseeA finance lease is a lease that transfers substantially all the risks and rewards incidental to ownership of an asset to the Council. The Council does not enter into contractual agreements, which include finance leases, as this is prohibited by the Treasury Regulation 13.2.5, which states; “The Accounting Officer of an institution may, for the purposes of conducting the institution’s business, enter into lease transactions without any limitations provided that such transactions are limited to operating lease transactions.”

1.7 Provisions, Commitments and Contingencies

1.7.1 ProvisionsA provision is a liability where the timing or amount of the outflow of resources embodying economic benefits or service potential is uncertain.

A provision is recognised when:

•• The ELRC has a present obligation (legal or constructive) as a result of a past event

•• It is probable that an outflow of resources embodying economic benefits or service potential will be required to settle the

obligation

•• A reliable estimate can be made of the amount of the obligation.

The amount of a provision is the best estimate of the expenditure expected to be required to settle the present obligation at the reporting date.

Where the effect of the time value of money is material, the amount of a provision shall be the present value of the expenditure expected to be required to settle the present obligation. The discount rate shall reflect current market assessments of the time value of money and risks specific to the liability.


The ELRC reviews provisions at each reporting date and adjusts them if necessary, to reflect the current best estimate. Provisions are reversed if it is no longer probable that an outflow of resources embodying economic benefits or service potential will be required to settle the obligation. Where discounting is used, the carrying amount of a provision increases in each period to reflect the passage of time; this increase is recognised as an interest expense.

1.7.2 CommitmentsA commitment is an agreement between two or more parties that is binding on those parties, to the degree that to renege on the agreement will be costly.

Commitments represent the orders issued to the suppliers that have been approved, but where no delivery has taken place as at year-end and contractual commitments.

Commitments are not recognised in the statement of financial position as liabilities and assets but are included in the disclosure notes.

The ELRC discloses the amount of contractual commitments for the acquisition of property, plant and equipment and intangible assets.

1.7.3 Contingent LiabilitiesA contingent liability is a possible obligation that arises from past events and the existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events that are beyond the control of the ELRC.

Alternatively, a contingent liability is a present obligation that arises from past events but is not recognised because:

•• It is not probable that an outflow of resources embodying economic benefits or service potential will be required to settle

the obligation; or

•• The amount of the obligation cannot be measured with sufficient reliability.

Contingent liabilities are included in the disclosure notes. The estimation of the amounts disclosed is based on the expected possible outflows of economic benefits should there be a present obligation.

1.7.4 Contingent AssetsContingent assets arise from unplanned or other unexpected events that are not wholly within the control of the ELRC and give rise to the possibility of an inflow of economic benefits or service potential to the ELRC.

Contingent assets are included in the disclosure notes. The estimation of the amounts disclosed is based on the expected possible inflows of economic benefits or service potential to the ELRC.

Contingent assets and contingent liabilities are not recognised as provisions as the recognition criteria are not complied with.

1.8 Changes in Estimates and Prior Period Errors

1.8.1 Changes in EstimatesAs a result of the uncertainties inherent in delivering services, many items in financial statements cannot be measured with precision but can only be estimated. Estimates involve judgement based on recently available, reliable information and therefore an estimate may change as new information becomes known, circumstances change, or more experience is obtained.


The ELRC recognises the effects of changes in accounting estimates prospectively, by including the effects in surplus or deficit in the period of the change - if the change affects that period only - or in the period of the change and future periods, if the change affects both.

1.8.2 Prior Period ErrorsPrior period errors are omissions from and misstatements in the ELRC’s financial statements for one or more prior period. These errors arise from a failure to use (or misuse of ) reliable information that was available when the financial statements for those periods were authorised for issue and could reasonably be expected to have been obtained and taken into account in the preparation and presentation of those financial statements.

Such errors include the effect of mistakes in applying the accounting policy, oversight or misinterpretation of facts.

1.8.3 Events after the reporting periodEvents after the reporting period are those events, favourable and unfavourable, that occur between the end of the reporting period and the date when the financial statements are authorised for issue.

The ELRC adjusts the amounts recognised in its financial statements to reflect conditions that existed at the end of the reporting period (adjusting events after reporting date) prior to authorisation for issue.

1.9 Standards of GRAP approved but not yet effective

1.9.1 Effect of New GRAP StandardsThe following approved standards of GRAP that have been issued but are not yet effective, are not likely to affect the annual financial statements when they are adopted, as these standards have been used to formulate and inform the current accounting policies and disclosures.

Standard number Standard name Effective date (if applicable)

GRAP 18 Segment Reporting No effective date

GRAP 20 Related party disclosures No effective date

GRAP 32 Service Concession Arrangements: Grantor No effective date

GRAP 105 Transfer of Functions Between Entities Under Common Control No effective date

GRAP 106Transfer of Functions Between Entities Not Under Common Control

No effective date

GRAP 107 Mergers No effective date

GRAP 108 Statutory Receivables No effective date

GRAP 18 Segment ReportingThe standard requires the identification and aggregation of the operating segments of the entity into reportable segments. For each of the reportable segments identified, details of the financial performance and financial position will be disclosed. The ELRC does not comply with GRAP 18 (Segment Reporting) and accordingly the adoption of this standard will have no material impact on the financial statements. No effective date has been determined by the Minister of Finance.


GRAP 20 – Related parties

This standard provides the requirements for the disclosure of related parties and transactions and balances with related parties. This standard was based on IPSAS 20 as currently applied by the entity for its related party disclosures. Accordingly, it is not expected that the adoption of this standard will have a material impact on the financial statements of the ELRC. No effective date has been determined by the Minister of Finance.

GRAP 32 – Service Concession Agreement This standard applies to a contractual agreement between a grantor and an operator in which the operator uses the service concession asset to provide a mandated function on behalf of the grantor for a specified period of time. The standard requires that the grantor shall recognise an asset provided by the operator as a service concession asset if the grantor controls or regulates what services the operator provides. No effective date has been determined by the Minister of Finance.

GRAP 105 – Transfer of Function Between Entities Under common ControlThis standard provides the accounting treatment for transfers of functions between entities under common control. The standard determines that assets and liabilities transferred to entities under common control will be recognised at their carrying values (per the records of the transferring entity) in the records of the receiving entity. The difference between the consideration transferred and the carrying value of the assets/liabilities transferred is recognised in accumulated surplus/deficit. No effective date has been determined by the Minister of Finance.

GRAP 106 – Transfer of Function between Entities Not Under common ControlThis standard deals with other transfers of functions (i.e. between entities not under common control) and requires the entity to measure transferred assets and liabilities at fair value. The difference between the consideration transferred and the carrying value of the assets/liabilities transferred is recognised in accumulated surplus/deficit. No effective date has been determined by the Minister of Finance.

GRAP 107 – MergersThis standard deals with requirements for accounting for a merger between two or more entities. The standard determines that the assets and liabilities acquired through the merger should be measured at their carrying values. Any difference between these carrying values and the consideration transferred for the merger is recognised in accumulated surplus / deficit. The standard would only apply to where the entity enters into a merger. No effective date has been determined by the Minister of Finance.

GRAP 108- Statutory ReceivablesThis standard provides for accounting treatment of statutory receivables. The statutory receivables in the public sector arise from contracts of legislative requirements. Receivables are recognised based on the transaction, i.e. either exchange transactions or non-exchange (GRAP 23) and if the transaction is out of the scope of the two standards listed above, then the receivable can only be recognised when the definition of asset is met. No effective date has been determined by the Minister of Finance.


The following interpretations have also been issued and are expected to have an insignificant impact on the financial statements, since they generally reflect the interpretation and principles already established under IFRS apart from the interpretations relating to leases, it is unlikely that the entity will encounter any of these issues in the normal course of its business.

Standard number Standard name Effective date (if applicable)

iGRAP 11 Consolidation – Special Purpose Entities No effective date

iGRAP 12 Jointly Controlled Entities – Non monetary Contributions By Venturers

No effective date

iGRAP 17 Interpretation of the Standard of GRAP on Service Concession Arrangements, Where a Grantor Controls a Significant Residual Interest in an Asset

No effective date

1.10 Presentation of Budget informationThe entity discloses a comparison of the budget and actual amount in the primary financial statements.

1.11 Related PartiesParties are considered to be related if one party has the ability to control the other party or exercise significant influence over the other party in making financial and operating decisions; or if the related party entity and another party are subject to common control.

Related parties include individuals who have significant influence over the entity, such as members of the EXCO, its committees and key management personnel.

Only transactions between the ELRC and related parties during the reporting period and not at arm’s length or not in the ordinary course of business, as well as comparative information are disclosed in the notes to the annual financial statements.

1.12 Impairment of non - financial assets (Cash-generating assets)At each reporting date, the entity reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). The recoverable amount is the higher of the fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the assets.

If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognised as an expense immediately.

Where an impairment loss subsequently reverses, the carrying amount of an asset is increased to the revised estimate of its recoverable amount; but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior years. A reversal of an impairment loss is immediately recognised as income.


1.13 Impairment of non-financial assets (Non cash-generating assets)Non-cash-generating assets are assets other than cash-generating assets.

When the carrying amount of a non-cash-generating asset exceeds its recoverable service amount, it is impaired.

An entity assesses at each reporting date whether there is any indication that a non-cash-generating asset may be impaired. If any such indication exists, an entity estimates the recoverable service amount of the asset.

The present value of the remaining service potential of a non-cash-generating asset is determined using one of the following approaches:

•• Depreciated replacement cost approach

•• Restoration cost approach

•• Service units approach

If the recoverable service amount of a non-cash-generating asset is less than its carrying amount, the carrying amount of the asset is reduced to its recoverable service amount; this reduction is an impairment loss. An impairment loss is recognised immediately in surplus or deficit. Any impairment loss of a revalued non-cash generating asset is treated as a revaluation decrease.

An entity assesses at each reporting date whether there is any indication that an impairment loss recognised in prior periods for a non-cash-generating asset may no longer exist or may have decreased. If any such indication exists, an entity estimates the recoverable service amount of that asset.

A reversal of an impairment loss for a non-cash-generating asset is recognised immediately in surplus or deficit. Any reversal of an impairment loss of a revalued non-cash-generating asset is treated as a revaluation increase.

1.14 Employee benefits

1.14.1 Short term employee benefitsThe cost of short term employee benefits (those payable within 12 months after the services is rendered, such as paid vacation leave and sick leave, bonuses, and non-monetary benefits such as medical care), are recognised in the period in which the service is rendered and are not discounted.

Short-term employee benefits include items such as:

•• Wages, salaries and social security contributions

•• Short-term compensated absences (such as paid annual leave and paid sick leave) where the compensation for the absences

is due to be settled within 12 months after the end of the reporting period in which the employees render the related

employee service

•• Bonus, incentive and performance related payments payable within 12 months after the end of the reporting period in which

the employees render the related service

•• Non-monetary benefits (for example, medical care, and free or subsidised goods or service such as housing, cars and

cellphones) for current employees

•• When an employee has rendered service to the entity during a reporting period, the entity recognises the undiscounted

amount of short-term employee benefits expected to be paid in exchange for that service:


•• As a liability (accrued expense), after deducting any amount already paid. If the amount already paid exceeds the undiscounted

amount of the benefits, the entity recognises that excess as an asset (prepaid expense) to the extent that the prepayment will

lead to, for an example, a reduction in future payments or a cash refund.

•• As an expense, unless another standard requires or permits the inclusion of the benefits in the cost of an asset.

1.14.2 Defined contribution planPayments to be defined as contribution retirement benefit plans are charged as an expense as they fall due.

1.15 Significant judgements and sources of estimation uncertaintyIn preparing the annual financial statements, management is required to make estimates and assumptions that affect the amounts presented in the annual financial statements and related disclosures. Use of available information and the application of judgement are inherent in the formation of estimates. Actual results in the future could differ from these estimates which may be material to the annual financial statements. Significant judgments include: provision for doubtful debts, useful life, residual value, impairment of assets and fair values.

1.15.1 Provision for doubtful debtsThe ELRC estimates the level of provision required for doubtful debts on an on-going basis based on historical experience as well as other specific relevant factors. A comparison between provision and actual loss incurred is performed to assess reasonableness of provision methodology.

1.15.2 Useful lives and residual values of property, plant and equipmentManagement has made certain estimates with regard to the determination of estimated useful lives and residual values of items of property, plant and equipment, as discussed further in note 4.5.1.1. Annual assessment and review of estimated useful lives and residual values are performed, and any significant change is accounted for as a change in accounting estimate in accordance with GRAP 3.

1.15.3 ImpairmentThe recoverable service amount of non-cash generating assets and individual assets have been determined based on the higher value in use and fair values of assets less cost to sell. These calculations require the use of estimates and assumptions. It is reasonably possible that the value in use or fair value assumption may change which may then impact our estimation and may then require a material adjustment to the carrying value of assets.

The ELRC reviews and tests the carrying value of assets when events or changes in circumstances suggest that the carrying amount may not be recoverable. If there are indications that impairment may have occurred, estimates are made for value in use.

The ELRC assesses its financial assets carried at amortised cost for impairment at each reporting date. In determining whether an impairment loss should be recorded in surplus or deficit, the entity makes judgments as to whether there is observable data indicating a measurable decrease in the estimated future cash flows from a financial asset.

1.15.4 Fair valueIn determining fair value less cost to sell, management makes assumptions that are based on market conditions existing at the end of each reporting date to determine a fair value of financial assets when there is observable evidence that the assets are impaired.


1.16 Irregular expenditure

Irregular expenditure as defined in section 1 of the PFMA is expenditure other than recognised expenditure, incurred in contravention of or that is not in accordance with a requirement of any applicable legislation, including:

•• The PFMA

•• The State Tender Board Act, 1968 (Act No.86 of 1968), or any regulations made in terms of this Act

•• Any provincial legislation providing for procurement procedures in that provincial government

Irregular expenditure is accounted for in terms of the National Treasury practice note No.4 of 2008/2009, which was issued in terms of sections 76(1) to 76(4) of the PFMA.

Irregular expenditure that was incurred and identified during the period under review, which was condoned before year-end, must be disclosed appropriately in the irregular expenditure note. In such instance, no further action is required with the exception of updating the note in the financial statements.

Irregular expenditure that was incurred and identified during the period under review, which was not condoned by the National Treasury or relevant authority, must be recorded appropriately in the irregular expenditure register. If the liability for irregular expenditure can be attributed to a person, a debt account must be created if such a person is liable by Law.

1.17 Fruitless and wasteful expenditure Fruitless and wasteful expenditure means expenditure which is made in vain and would have been avoided had reasonable care been exercised.

Where an investigation determines, a receivable will be recorded against an employee who has been found to have incurred the fruitless and wasteful expenditure. In instances where a receivable is not raised against an employee or the amount is irrecoverable, the Accounting Authority may write off the debt. Fruitless and wasteful expenditure identified is disclosed in the notes to the financial statements.


Notes to the Annual Financial Statements for the period ended 31 March 2015

Note 2

Other receivables from exchange transactions 2015R

2014 R

Sundry debtors 1 092 538 2 006 256

Prepayments 192 147 192 018

Rental deposits 92 064 71 098

Accrued interest income 68 746 51 634

Less: Provision for impairment of trade receivables (note 2.1) - (50 128)

1 445 495 2 270 878

The ELRC does not hold any collateral as security. The fair value of other receivables from exchange transactions is equal to the invoice amounts or an amount as per signed agreements.

The impairment of trade receivables has been determined with reference to the probability of collection of the amounts.

Note 2.1

Movement in the provision for impairment of other receivables 2015R

2014R

Opening balance 50 128 50 128

Reversed during the year (50 128) -

Unrealised provision - -

Closing balance - 50 128

Note 3

Cash and cash equivalents 2015R

2014R

Cash and cash equivalents consist of:

Cash on hand 8 404 5 077

Current account 25 673 807 22 635 238

Short term deposits* 110 858 693 104 556 401

136 540 904 127 196 716

No restrictions have been placed on the use of the cash and cash equivalents for the operations of the ELRC. The carrying amount of these assets approximates to their fair value.

*Short term deposits are held with the Corporate of Public deposits (SARB), the deposits are carried at an effective floating interest rate that varies between 5.5% and 5.8% (2014: 4.8% and 5.5%).


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Payables from exchange transactions 2015R

2014R

Trade payables 1 096 915 1 901 790

Other payables (PCTA liability) 17 968 19 438

Other accrued expenses 2 663 551 1 463 617

3 778 434 3 384 845

Note 7

Operating lease liability 2015R

2014R

Lease liability (straight lining) 101 917 75 302

Total minimum lease payments

Not later than one year 998 872 786 182

Later than one year and not later than five years 963 627 1 544 889

Later than five years - -

1 962 499 2 331 071

The operating lease liability is the difference between actual payments and straight–lining as recognised in the statement of financial performance. The minimum lease payments reflected above only relate to the lease commitments; contractual commitments are disclosed under note No.17.

Operating lease payments represent rentals payable by the ELRC for rentals of premises in the nine provincial offices. The leases typically run for a period of three to five years, with an option to renew. Rental expenses are increased annually as per the escalation clauses of the lease agreements.

Note 8

Provisions 2015R

2014R

Short–term

Provision for SADTU 711 893 1 830 603

Provision for dispute prevention shop stewards 48 559 257 48 559 257

49 271 150 50 389 860

Reconciliation of Provisions: 31 March 2015


Short-term Opening Balance Utilised Addition Transfers Total

Provision for SADTU 1 830 603 (1 118 710) - - 711 893

Provision for dispute prevention shop stewards 48 559 257 - - - 48 559 257

50 389 860 (1 118 710) - - 49 271 150

Reconciliation of Provisions: 31 March 2014

Short-term Opening Balance Utilised Addition Transfers Total

Provision for SADTU 1 187 993 - - 642 610 1 830 603

Provision for dispute prevention shop stewards 35 454 323 (742 365) 13 847 299 - 48 559 257

36 642 316 (742 365) 13 847 299 642 610 50 389 860

Provisions comprise of costs to be claimed for services rendered by Parties to Council but for which claims have not been received. A reliable estimate is made based on the number of meetings attended and provisions as per Collective Agreement.

Note 9

Long-term payables (shop stewards) 2015R

2014R

Other payables (Shop Sterwads liability) 26 530 769 19 644 317

Note 10

Revenue 2015 2014

Exchange revenue 49 212 798 49 321 956

Other income 7 035 261 5 634 093

56 248 059 54 956 049

The amount included in revenue arising from exchanges of goods or services are as follows

Interest income 7 035 261 5 634 093

Tender deposits 16 000 -

Insurance proceeds 224 401 62 188

Discount received - 49

Gains on disposal of assets - -

The amount included in revenue arising from exchange transactions is as follows

Levy contributions by parties 49 212 798 49 321 956

All levies received bear no credit risk and are paid from salary deductions from educators and an equal contribution by employer.

Average number of educators is 409 326 (2014: 410 816)


Note 11

Personnel related costs 2015 2014

Basic earnings 13 584 349 11 117 152

Temporary Employees - 76 249

Performance bonuses 1 556 273 1 238 634

Third party payments* 3 099 504 2 225 750

Unemployment Insurance fund (UIF) 87 016 76 084

Leave expenses 641 294 (2 259)

Long-service awards 7 500 -

Travel allowance 256 554 187 246

Housing allowance 585 721 496 154

Skills Development Levy 170 751 134 551

19 988 962 15 549 561

* Payments include costs related to medical aid, pension fund contributions, group life, etc.

Note 12

Administration expenses 2015 2014

Conciliation 1 183 930 959 213

Arbitration 5 074 240 4 159 177

Condonation 100 500 87 000

Cost of quality control 170 792 78 000

FETC - Arbitration and Conciliation 91 563 197 410

Mutual Interest Dispute 2 550 59 299

6 623 575 5 540 099


Note 13

General expenses 2015 2014

Advertising and Recruitment 524 408 730 678

Auditors fees 745 923 902 072

Bank charges 46 517 43 133

Bad debts written-off 16 848 24 090

Implementation of Acts and Agreements 137 423 43 565

Cleaning and sanitation 56 419 62 478

Dispute Prevention Support 8 848 502 7 191 456

Meetings 2 812 419 2 911 324

Consulting and professional fees 406 163 670 167

Consumables 122 255 195 626

Quality Learning and Teaching Campaign 258 104 746 189

Sundry - 1 093

Relocation costs - 8 322

Training and Development Services 1 748 589 1 657 792

Provincial chambers 934 918 833 213

Insurance 215 410 256 392

Electronic Media 505 706 508 010

Rentals 1 008 172 912 938

Legal Expenses 641 386 604 561

Motor vehicle expenses 32 799 38 100

World Teacher’s Day 354 363 1 051 317

Printing and publications 253 377 382 052

Stationery 133 781 89 937

Research and Development 1 096 511 -

Internal Audit Fees - 254 940

Meals and accommodation 5 072 8 326

Security 321 775 418 842

HR Expenses 151 581 141 547

Subscriptions and license fees 113 273 117 157

Telecommunication costs and postal fees 653 324 683 480

Staff training 194 167 157 434

Travelling costs 90 960 186 316

Water and electricity 756 503 655 318

23 186 648 22 487 865


Note 14

Cash generated from operations 2015 2014

Surplus 4 833 027 9 436 293

Adjustments for:

Depreciation and amortisation 1 244 725 1 065 176

Loss/(gain) on assets written off 76 838 246 446

Write-off as credit losses 16 848 24 090

Movement in operating leases 26 615 15 370

Movement in provisions (1 118 710) 13 122 210

Prior period error non cash flow item - (24 991 060)

Reversal of liability - 10 460 637

Changes in working capital:

(Increase)/decrease in receivables from exchange transactions 808 535 (106 002)

Increase/(decrease) in payables from exchange transactions 393 591 (10 924 672)

6 281 469 (1 651 512)

Note 15

Correction of Prior Period Errors and changes in Accounting Estimates

Corrections of Errors;

Property, plant and equipmentDuring the current financial year management reviewed the useful life of assets with a zero carrying amount in an effort to improve the accounting for assets as required by the accounting standards. The useful life assessment was based on the conditions of the assets and a limited useful life of two years. These are considered to be management’s best estimates at the reporting date.

Provision and liability for Dispute Prevention shop stewardsThe provision for dispute prevention shop stewards was incorrectly raised in the prior periods instead of a liability as required by the standards. This was corrected in the current financial year by correctly classifying the amounts as liabilities in the financial statements as per the collective agreement.

Cash and cash equivalentsA bank account was opened for the PCTA project in the prior periods for the project. A liability was not raised for the remaining balances against the donor. A correction was made during the financial year.

Operating leases, Accruals & Provision for leasesOperating lease liability was erroneously raised on the movements rather than the lease balances in the prior periods after the lease payments were equalised over the lease period. This was incorrect as it understated the lease liabilities.

The accruals from the previous periods were not cleared in the subsequent financial years, therefore overstating expenses and the liabilities of the Council. Corrections were effected in the current financial year.


The provision for leave was incorrectly raised in the previous years despite the fact that it was not a liability where the timing or the amount of the outflow embodying economic benefits or service potential is uncertain. The corrections will be done during the current year.

Corrections were made and appropriated to the Accumulated Surplus account during the financial year end 31 March 2015. These corrections resulted in correction of the prior year’s figures and the impact is as follows:

Statement of financial position: 2015 2014

Prior year (Increase)/decrease in Accumulated Surplus 23 674 428 25 731 065

Current year (Increase)/decrease in Accumulated Surplus (1 393 920) (2 056 637)

Total (Increase)/decrease in Accumulated Surplus 22 280 508 23 674 428

(Increase)/decrease in Provision - Dispute Prevention SS (4 252 718) (13 058 582)

(Increase)/decrease in Liability - Dispute Prevention SS (19 644 317) (12 452 861)

Increase/(decrease) in cash and cash equivalents 19 438 -

(Increase)/decrease in accruals 520 385 520 385

(Increase)/decrease in operating Lease liability (20 996)

(Increase)/decrease in Accumulated Depreciation 1 097 700 1 316 631

(Increase)/decrease in Accrual Leave Pay 537 715

(Increase)/decrease in Provision for leave (537 715)

- -

Statement of Financial Performance:

Increase/(decrease) in Dispute prevention support (1 614 408) (2 373 145)

Increase/(decrease) in operating lease expense 20 996

Increase/(decrease) in depreciation 218 931 316 508

Increase/(decrease) in other income (19 438)

(1 393 920) (2 056 637)

Note 16

Contingencies 2015 2014

Liabilities

Legal claim 300 000 2 994 930

Legal costs 80 000

380 000 2 994 930

Legal claims relates to civil cases against the Council for potential loss of income. The Council does not expect that an outflow of resources embodying economic benefits or service potential will be required to settle these obligations. The claim was reduced to R300 000 during the current period.

Assets

Legal claim 50 000 -

Legal costs 60 000 -

110 000 -

The Council has a claim in a civil case for losses arising from a cancelled contract. The Council expected possible inflows of economic benefits or service potential as at year end.


Note 17

Taxation The Council is exempt from the payment of income tax in terms of section 10(1) (CA) (I) of the Income tax Act, No. 58 of 1962

Note 18

Commitments 2015 2014

Already contracted, but not provided for:

Capital expenditure 24 366 978 -

Operating expenditure 1 151 673 -

25 518 651 -

Not yet contracted for and authorised by member:

Capital expenditure - -

Commitments disclosed take into account the escalation clauses as per the contractual agreements. Capital commitments relate to the building refurbishment project that the ELRC has embarked on since January 2015, the contract was awarded to Bula Project as the project managers and is being managed by Studio 3 Design House. All commitments are financed through the revenue account except for the Building project which is financed through transfer from the accumulated reserves.

Note 19Related parties

Controlling entity Department of Basic Education

Members of key management Ms Nolusindiso Foca

Mr Omphitlhetse Mafora

Mr Musa Mahlangu

Mr Matlose Moela

Mr Frederick Moloisi

Ms Nelisiwe Bongco

Entities under common control* Umalusi

SACE

Trade Unions

South African Democratic Teachers Union (SADTU)

Combined Trade Union – Autonomous Trade Union (CTU-ATU)

*The entities are under common control of the Department of Basic Education of which the ELRC forms part.

Related party transactions No related party transactions for the period under review


Note 19 (continued)

Key Management Personnel

Key management information

Class Description Number of members

Executive members Accounting Authority 11

Non-executive members Accounting Authority 3

Executive management Accounting Officer/Executive 2

Senior management Management 4

Executive members

Executive members emoluments Fees Other * Total Fees2015

Fees Other* Total Fees2014

Adv. L Bono 204 811 244 595 449 406 129 392 46 000 175 392

Members of the ELRC Executive committee did not receive emoluments during the financial year, except for Adv. L Bono who is an independent Chairperson of EXCO who receives such fees as per collective agreement. The Board fees to date amount to R 204 811.

*This relates to the fees paid for services rendered by the independent Chairperson outside the scope of the EXCO.

Non-Executive members

Non-executive members emoluments Fees2015

Fees2014

Ms T Moeeng 28 672 37 312

Mr M Maluleke* - -

Mr M Mahonga 21 760 20 560

Mr SA Ngobeni 15 821 10 280

Mr N Maluleka* - -

66 253 68 152

Non-Executive members serve in the audit committee of the ELRC. The Audit Committee sits for four meetings annually and any other special meetings.

*The members are representatives of parties to the Council, and by virtue of being non-independent members they are not eligible for payments.


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Mr A

M M

ahla

ngu

426

551

39 0

2276

780

54 9

5163

328

660

632

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N B

ongc

o –

01 M

ay 2

014

390

222

26 0

1570

240

10 0

0060

754

557

231

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S M

oloi

si42

6 55

139

022

76 7

8054

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25 1

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2 48

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– 0

1 M

ay 2

014

420

325

28 2

4575

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14 5

3018

149

556

907

1 66

3 64

913

2 30

429

9 45

813

4 43

216

7 40

92

397

252

Seni

or m

anag

emen

t em

olum

ents

20

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ryPe

rfor

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bonu

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th

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ue

Prov

iden

t Fu

nd

cont

ribu

tion

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el &

H

ousi

ng

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wan

ces

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tal

Mr A

M M

ahla

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335

784

24 2

6736

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58 8

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6 03

050

5 83

4

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S M

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3 41

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36 3

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669

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720

89 1

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1 01

3 48

6


Note 20

Irregular expenditure 2015 2014

Opening balance - 1 570 363

- Add: Irregular expenditure - current year 145 302 -

- Less: Amounts condoned - (1 570 363)

- Less: Amounts recoverable (not condoned) - -

- Less: Amounts not recoverable (not condoned) - -

145 302 -

The Council did incur irregular expenditure relating to non-compliance with the requirements of Treasury regulations 16A3 and Practice note 8 of 2007/8, wherein at least three quotations were not obtained from a list of prospective suppliers for procurements of goods or services for value above R2 000. It was also noted that in some instances the suppliers were appointed without completing all the required standard bidding forms (SBD).

The Council has implemented controls to ensure that all supply chain requirements are complied with. An investigation has been instituted for the disclosed irregular expenditure as at year end.

Note 21

Retirement benefits 2015 2014

Define contribution plan 2 383 497 1 813 899

The Council provides retirement benefits through a defined contribution plan to all its employees. The Provident fund is governed by the Pension Funds Act, 1956 (Act no 24 of 1956). The entity is under no obligation to cover any unfunded benefits.

Note 22

Fruitless and wasteful expenditure 2015 2014

Opening balance 60 910 71 412

Add: Fruitless and wasteful expenditure incurred during the year 79 141 60 910

Less: Recovered during the year - -

Less: Written off during the year (60 910) (71 412)

Closing balance 79 141 60 910

The fruitless and wasteful expenditure relates to expenses incurred for meetings and training. Non-attendance by some members of the parties resulted in cancellations of travel, accommodation and catering. The Council continues to monitor these occurrences and where applicable controls are put in place.


Note 23

Financial instruments risk management

The Council’s activities has limited exposure to financial risks, market risk (including currency risk, fair value interest rate risk, cash flow interest rate risk and price risk), credit risk and liquidity risk. Risk management is carried by the Risk Management Committee under a policy approved by the Council.

Liquidity riskPrudent liquidity risk management implies maintaining sufficient cash. The Council’s primary source of funding is through equal contributions by the parties, which consist of the employer and the employees. The Council maintains liquidity by limiting capital and operational expenditure within the pre-approved budget.

The table below illustrates the Council’s exposure to liquidity risk from financial liabilities:

2015 Carrying Amounts

Contractual cash flow

1-12 months 2-5 years Later than 5 years

R R R R R

Payable from exchange transactions 3 880 351 3 880 351 3 880 351 - -

Other financial liabilities 49 271 150 49 271 150 49 271 150 - -

Total 53 151 501 53 151 501 53 151 501 - -

2014

Payable from exchange transactions 3 460 147 3 460 147 3 460 147 - -

Other financial liabilities 50 389 860 50 389 860 50 389 860 - -

Total 53 850 860 53 850 860 53 850 860 - -

Interest rate riskThe Council’s exposure to the risk of changes in market interest rates relates primarily to cash in the current accounts and notice deposits held with the banks.

Cash and cash equivalents 2015 2014

Call deposits and current accounts 136 540 904 127 177 278

Cash flow riskThe Council manages its cash flow risk by aligning the monthly budget allocations to estimated monthly activity levels:

Revenue from non–exchange transactions 2015 2014

Levies 49 212 789 49 321 956


Fair value rate riskThe Council considers that the carrying amount of the other receivables, cash and cash equivalents and payables approximate to their fair values.

2015 2014

Other receivables from exchange transactions 1 445 495 2 270 878

Cash and cash equivalents 136 540 904 127 177 278

Payables from exchange transactions 3 880 351 3 460 147

Credit riskThe Council has limited credit risk. The credit risk receivables relate to contractual rights that arose from the debt dually owed to the Council and these are monitored on an ongoing basis with the result that exposure to irrecoverable debts is minimal.

With respect to credit risk arising from cash and cash equivalents, cash is placed with authorised financial institutions. The carrying amounts of the financial assets represent the maximum credit exposure.

The maximum exposure at the reporting date was:

2015 2014

Other receivables from exchange transactions 1 445 495 2 270 878

Cash and cash equivalents 136 540 904 127 177 278

137 986 399 129 448 156

The maximum exposure to credit risk for other receivables at the reporting date by major cluster was:

2015 2014

Cash collateral provided 92 064 71 098

Accrued interest – major South African banks 68 746 51 634

Sundry receivables – refunds and SARS 962 048 1 882 722

1 122 858 2 005 454

The Council has not pledged any of the receivables as security for any debt or other arrangements.

Price riskThe Council’s exposure to price risk is non-existent as the Council does not trade goods or services to the public.

Foreign exchange riskThe Council does not, in the normal course of its business, operate internationally and has limited exposure to foreign exchange transaction risk from various currency exposures. Transactions in the foreign currency are primarily overseas subsistence and travel allowances. The Council does not have such transactions to report in this financial year.


Note 24

Events after reporting date

The Accounting Authority is not aware of any matters that arose after the reporting date that require adjustment to the financial statement or additional disclosure.

Note 25

Subsequent events

Delisting from PFMA: The ELRC is delisted in terms of the Public Finance Management Act of South Africa, 1999 (Act No. 1 of 1999) and will operate in terms of the Labour Relations Act, 1995 (Act 66 of 1995) (as amended) from 1st April 2015.

Note 26

Going Concern

The annual financial statements have been prepared on the basis of accounting policies applicable to a going concern. This basis presumes that funds will be available to finance future operations and that the realisation of assets and settlement of liabilities, contingent obligations and commitments will occur in the ordinary course of business.


State

men

t of

Com

pari

son

of B

udget

and

Act

ual A

mou

nts

for

the

Peri

od e

nded

31 M

arc

h 2015

Des

crip

tion

31 M

arch

20

15 A

ctua

ls

App

rove

d Bu

dget

s 20

15A

djus

tmen

tsFi

nal B

udge

t 20

15

Diff

eren

ce

Betw

een

Fina

l Bud

get

and

Act

ual

Ref

Reve

nue

56

488

460

57

975

359

-

57

975

359

1 4

86 8

99

Exch

ange

reve

nue

49

212

798

55

473

653

(3

252

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52

220

704

3 0

07 9

06

Levi

es

9

49 1

21 7

98 4

8 00

0 00

0

-

48

000

000

(1 2

12 7

98)

(3%

)26

.1

Tran

sfer

from

rese

rves

-

7 4

73 6

53

(3

252

949)

4

220

704

4 2

20 7

04

100%

26.2

Oth

er In

com

e

7 2

75 6

62

2 50

1 70

6

3 25

2 94

9

5 75

4 65

5 (1

521

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ry in

com

e10

242

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-

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(224

401

)(1

00%

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26.3

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com

e 1

6 00

0

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-

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(

16 0

00)

(10

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Inte

rest

inco

me

7

035

261

2 5

01 7

06

3

252

949

5 7

54 6

55

(1 2

80 6

06)

(22%

)26

.4

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ndit

ure

(51

578

595)

(57

975

359)

-

(57

975

359)

(5 5

10 4

81)

Pers

onne

l rel

ated

exp

ense

s11

(19

988

962)

(21

710

335)

- (2

1 71

0 33

5)(1

721

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)8%

26.5

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inis

trat

ion

expe

nses

12 (

6 42

3 57

5) (

5 81

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8)

-

(5 8

13 1

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27(1

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26.6

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reci

atio

n an

d am

ortis

atio

n5

6

(1 2

44 7

25)

(

637

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-

(637

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607

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(9

5%)

26.7

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irs a

nd m

aint

enan

ce

(7

34 6

85)

(

593

252)

-

(593

252

)

141

433

(2

4%)

26.8

Gen

eral

exp

ense

s13

(23

186

648)

(29

220

954)

- (2

9 22

0 95

4)(6

034

306

)21

%26

.9

Gai

ns/(

loss

es) o

n di

spos

al o

f ass

ets

and

liabi

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s

(

76 8

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-

-

-

7

6 83

8 (1

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Surp

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(defi

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for

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ovem

ber 2

014

4 83

3 02

7

-

-

-

(4

833

027

)


Note 26

Budget compared to the statement of financial performance

The Council presents its approved annual budget and the financial statements on an accrual basis. The Council uses National Treasury budgets templates (ENE/MTEF) for public entities to prepare its budgets.

The following represents explanations to the reconciliations of the significant variances between the approved budgets and the Statement of Financial Performance:

26.1 LeviesThere has been improvement in the collection of levies from FETC in the period under review.

26.2 Transfer from reservesThe Council did not have to transfer from reserves to supplement income for its operations.

26.3 Other Income Amounts were not budgeted for.

26.4 Interest income The Council hold reserves with financial institutions that earn interest based on the performance of the markets and the effective floating rates from previous financial periods have increased at an average of 0.3% in the period under review.

26.5 Personnel related expensesPersonnel related costs came below the budgeted cost due to resignations and retirement during the reporting period. There were six resignations during this period; one was a senior management position and another an executive management position, which resulted in under-expenditure.

261.6 AdministrationExpenditure was in line with anticipated variances under Administration.

26.7 Depreciation The fixed assets register of the Council has seen an increase in the value of the building due to the refurbishment project. An addition of R2 million was added to the building and a new vehicle was purchased to the value of R499 000.00.

26.8 Repairs and maintenance The aging computer equipment of the Council resulted in an increase in the repairs and maintenance costs.

26.9 General expensesAn investment in the training of Dispute Resolution Practitioners and Panellists was made during the period under review as part of the Council’s dispute prevention strategies and in an effort to decrease the number of cases referred to the Council. A total of 345 Dispute Resolution Practitioners were trained and 94 Panellists were professionally developed during the period under review.


DETAILED STATEMENT OF FINANCIAL PERFORMANCE Education Labour Relations CouncilFinancial Statements for the year ended March 31, 2015

STATEMENT OF FINANCIAL PERFORMANCE

Figures in Rand Note(s) 2015 2014

REVENUELevies 49,212,798 49,321,956

Other incomeDiscount received - 49

Tender income 16,000 -

Other income 224,401 62,188

Investment income 13 7,035,261 5,634,093

7,275,662 5,696,330

EXPENDITUREArbitration and mediation 6,423,575 5,540,099

Advertising and Recruitment 524,408 730,678

Auditors fees 15 774,672 902,072

Bad debts written-off 16,848 24,090

Bank charges 45,932 43,133

Implementation of Acts and Agreements 137,423 43,565

Cleaning and sanitation 56,419 62,478

Interest expense 585 -

Dispute Prevention Support 8,848,502 7,191,456

Meetings 2,812,419 2,911,324

Consulting fees 406,163 670,167

Office expenses 122,255 195,626

Quality Learning and Teaching Campaign 258,104 746,189

Depreciation and amortisation 1,244,725 1,065,176

Staff cost 19,988,962 15,549,561

Sundry - 1,093

Relocation costs - 8,322

Training and Development Services 1,748,589 1,657,792

Provincial chambers 934,918 833,213

Electronic media 505,706 508,010

Insurance 215,410 256,392

Rental 1,008,172 912,938

Legal expenses 641,386 604,561

Loss on disposal of assets 76,838 246,446

Motor vehicle expenses 32,799 38,100

World Teacher's Day 354,363 1,051,317

Printing and publications 253,377 382,052

Stationery 133,781 89,937

Research and Development 1,096,511 -

Internal Audit Fees (28,749) 254,940

Meals and accommodation 5,072 8,326

Repairs and maintenance 734,685 692,846

Security 321,775 418,842

HR Expenses 151,581 141,547

Subscriptions 113,273 117,157

Telecommunication costs and postal fees 653,324 683,480

Staff training 194,167 157,434

Travelling costs 90,960 186,316

Water and electricity 756,503 655,318

51,655,433 45,581,993

SURPLUS FOR THE YEAR 4,833,027 9,436,293

6

Education Labour Relations Council (ELRC)

ANNUAL REPORT2014 - 2015

Realising the importance of a unified determination to address labour imbalances that impedes

progress in public education.

HOPE

FUTURE

DEDICATION

SUCCESS

PEHOPEHOP

REGISTERED NAME:Education Labour Relations Council

REGISTRATION NUMBER:LR2/6/6/110

PHYSICAL ADDRESS:261 West Avenue

Centurion0046

POSTAL ADDRESS:Private Bag X126

Centurion0046

TELEPHONE NUMBER:+27 12 663 7446

FAX NUMBER:+27 12 663 9604

EMAIL [email protected]

WEBSITE ADDRESS:www.elrc.org.za

RP159/2015ISBN: 978-0-621-43659-4

Documents

DEDICATION ANNUAL REPORT 2014_15... · vision for 2030, which aims to ensure that South Africans have access to training and education of the highest quality, characterised by signiﬁcantly