Wednesday, 21 November 2007

13th Cheque

The SABC is in the (unlawful) process of phasing out 13th cheques for middle management in its current form.

In a letter addressed to middle management no option is given to accept or reject this. Employees simply have to sign that they have received this letter, that informed them it will change. The SABC Human Resources Director, Dr Pat Naves is claiming in the same letter addressed to middle management that she has consulted with the unions on this issue.


We were never consulted on this. In any event, this is not a matter of consultation, but of negotiation. After all, it's terms and conditions of employment.

We have asked our representative on the pension fund to investigate this matter and report back on it. Once his report is available, it will be published here.

In the meantime, advise the Human Resources Director that you do not accept this change to your terms and conditions of employment.


Regarding Dr. Nave’s letter about the thirteenth cheque for middle management, just a few observations

This will not have any tax or pension implications.

At present our thirteenth cheque is taxed as normal salary and therefore taxed in full. The percentage or tax depends on the income of an individual and will be taxed on the marginal percentage for your specific income. At the end of the tax year when you do your return, a calculation is made based on your full income. It does not matter whether this income was received periodically (monthly) or in a single amount.

As for pension, this is based only on our basic salary and excludes any other receipts such as a thirteenth cheque, other bonuses, housing or car allowance or overtime. Dr. Naves’s new disposition will therefore also not affect pensions.

As for the last paragraph in the letter, it is not clear what exactly is envisaged. If the thirteenth cheque, which will now be based on merit, instead of being paid in December, will now be paid out monthly starting from April 2008, it is unclear how merit will be considered. Dr Naves say the bonus will henceforth be based on performance during the financial year after approval of financial statements. If next year’s payments will already start in April 2008, how can it be based on the 2007/8 financial year as financial statements are normally approved much later. At salary negotiations, we know from experience that financial statements can not be presented to us even several months after the end of March (end of the financial year) as it is not approved yet. The question therefore is on what year’s merits will the bonuses then be based? What is a “full performance cycle” as mentioned in the letter. If this is say three months preceding 1st April, what about the part that says it will be determined after approval of the financial statements, which normally only happens, as said, only several months after 1st April?
Also, if it is based on merit, one would expect differentiation between low and high performers. It seems however, that everybody will still receive a month’s salary or 1/12th of the annual salary.

It would certainly be unwise for anyone presented with the 13th cheque letter to sign their approval if they do not know what exactly they are signing for. It would be better, I think, for BEMAWU to first negotiate this with management. This is a drastic change of the terms of your service contract with the SABC. It can mean that you will loose 13th of your annual salary (if your merit is regarded as low)- it is just not clear at this stage. Such a contract can only be changed with mutual consent and not unilaterally. You therefore do have a choice. If you do not accept the new dispensation, the status quo will remain.

Fred Daniel
Shop Steward and BEMAWU representative on the Board of the Pension Fund.

1 comment:

Anonymous said...

How will we know that we will ever again get a 13th cheque? The letter syas its payable after approval by the SABC. How do we know what amount and or percentage will we receive?

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