How Skills Training can be Provided at No Cost to the Employer,
and the Incentives for Employers Funding Learnerships.

FIRST A BIT OF BACKGROUND INFORMATION

From April 2000 every employer in South Africa that has an annual payroll of over R250,000.00 and is registered with SARS pays a levy to a SETA (Sector Education and Training Authority).

Each SETA deals with education and training in a specific area of the economy eg construction, transport, mining. There are 25 SETA’s.

One of the SETA’s functions is to establish learnerships.

LEARNERSHIP

A learnership is a training programme that leads to nationally recognised qualification. It involves theoretical learning at a college or training centre and on-the-job training. The learner, the employer and the training providers sign a legal agreement, in which their rights and responsibilities are stated.

Anyone can apply for a learnership – those who have just left school, those who are not employed and those who are already in jobs. There are no age requirements.

A learnership will cost the learner nothing and he/she will be paid a learner allowance by the employer.

Learnerships can be established wherever the SETA identifies a need.

The employer does not have to provide the learner with a job at the end of the learnership. Even where there is no job, if the learner has completed the learnership successfully, he will have experience and a qualification at the end of the training.

TO APPLY FOR A LEARNERSHIP IF YOU ARE UNEMPLOYED

Register with the Department of Labour by filling in the Work Seeker Registration form and the Interests form.

EMPLOYERS CAN OFFER LEARNERSHIPS

Either to their own employees or to unemployed people.

There are costs involved for the employers:

• Fees for theoretical training
• Costs involved in supervising learners
• The cost of assessing learner’s progress
• Learner allowance

There are incentives to help the employer with funding learnerships:

• Employers who pay a skills levy to a SETA, can claim cash grants when they provide training. SETA’s may also pay learnership grants for the implementation of learnerships. This is in addition to the levy repayment for drafting and/or implementing a work place skills plan.
• Once the employer has registered a learnership with a SETA, there are two tax incentives which can be claimed from SARS. One of the tax incentives is at the beginning of the learnership and the other at the successful conclusion.
1. At the start of the learnership:
   For those already employed: Once the learnership agreement has been signed and registered with a SETA, the employer may deduct 70% of the annual wages paid to the learner up to a maximum of R17,500.00 during the relevant year of assessment.
   
   For unemployed learners: Once the learnership agreement has been signed and registered with a SETA, the employer may deduct 100% of the learnership allowance paid to the learner up to R25,000.00 in the relevant year of assessment.
   
2. On successful completion of the learnership, the employer can claim up to 100% of the annual wage paid to an employee or 100% of the allowance paid to an unemployed learner up to a maximum of R25,000.00 during the relevant year of assessment.
   

Details of how to claim tax incentives are available from the South African Revenue Service and/or your SETA (see the resource list below).

Resource list

The above information has been taken from 2 Department of Labour publications: “A Learnership Guide for Unemployed People” and “How to Start Up a Learnership”.

The Department of Labour website is www.labour.gov.za Go to the Skills Development Link and there is a list of all registered learnerships.

List of SETA’s with contact details is available on-line.

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