Proactive HR

What do you mean by “proactive HR”?

For many employers, HR is largely reactive. Responding to events within the organisation as they arise – grievances, high levels of absenteeism, collective action, operational performance issues. By the time issues escalate to this level it requires significant management attention to resolve.

The concept of proactive HR looks to identify and deal with HR issues before they become problematic and use up senior management time. 

We do this in a number of ways:

  1. We use a series of tools to identify “problem” areas before they escalate. This includes analysing data to identify employees who are disillusioned, not engaged or potential trouble-makers. We then, together with local management, proactively manage these employees before bigger issues arise. In our experience, HR ends up looking fantastic through this process because it allows them to:
    – Clearly show senior management where they are adding value;
    – Impress local management with their ability to see into the organisation (and keep them on their toes); and
    – Improve local management performance by identifying and coaching those local managers who were aware of an issue, but were not sufficiently skilled or proactive to manage their team themselves;
  2. Through daily experience with employee arbitrations, we know that employers tend to win matters consistently when they have the right documentation in place, have gone through a proper process with employees and are fair in their dealings with employees. The second pillar of proactive HR is therefore to get the basics right. This can be done at reasonable cost by just following a few easy steps and in the long run results in significantly lower senior management involvement, time and cost.
  3. The majority of collective employee disengagement, frustration and conflict stems from poor or no communication in the organisation. This is often a more difficult area to get the right balance. We use a number of tools to improve HR communication. This makes HR more visible to all and helps to identify bigger issues before they become problems.

If you would like to know more about proactive HR and how HRTorQue can help, please feel free to contact us at [email protected].

The Importance of Payroll Reconciliations

Having processed payrolls for multiple clients over many years one of the things we have noticed is that often a reconciliation is not performed (or not performed well) between the processed payroll, the actual payments made to employees and third parties; and the general ledger recorded in an employer’s books.

This lack of a solid reconciliation occurs for a number of good reasons:

•   Confidentiality – the finance team performing the recons are not privy to detailed employee information (and senior finance don’t have the time to do the recons themselves);
Understanding – some of the issues that arise in payroll can be confusing/complex either from an HR/tax perspective or from an accounting perspective;
Communication – the payroll may be processed by HR, but nobody communicates with the person doing the recon to explain why specific transactions have taken place;

The downside to either no recon being performed or a recon being performed badly leads to a number of risks for the business from an accounting perspective:

•   Leave and bonus provisions are not recorded accurately
The general ledger may balance, but employer contributions and fringe benefits (double sided entries) may not have been coded and do not appear on the general ledger
The general ledger may assume that all nett pay and third party payments have been made and reflect no liability whereas in reality some payments may not have gone through properly (e.g. garnishees) or where payments have been deliberately withheld until an issue is resolved
The balance sheet may not accurately reflect loan accounts, SARS liabilities (incl ETI) and employees with negative net pay (never recovered)

We would highly recommend employers perform a reconciliation between their payroll, general ledger and EFT payments. This is a critical control. Our accounting team is available to assist with this to offer a confidential, professional service, should you wish to take this route.

HRTorQue is Moving

You may see the “for sale” signs up at our offices at 163 Umhlanga Rocks Drive.

On 1 September HRTorQue’s Durban offices are moving to 6 Pencarrow Crescent in Pencarrow Business Park, La Lucia Ridge, Umhlanga.

We will notify all clients of these details closer to the time of our move.

HRTorQue December Office Closure

HRTorQue will be closing on 22 December 2016, and will re-open on 9 January 2017.

During this time, we shall have a skeleton staff to cater for those clients we know will not be closing. We shall make special arrangements for staff to be available for them. During the shutdown time, we will monitor the [email protected] email address.

In case of emergency only please contact:
Karen van den Bergh: 082 891 1722 (for any payroll or 3rd party payment queries)
Nicky Hardwick: 083 788 6999 (for any labour or HR issues) or email [email protected]

Are CCMA arbitration awards enforceable?

Editor: The Courts have ruled CCMA arbitration awards are enforceable. Given the uncertain nature of arbitrations, we would really encourage employers to improve their internal dismissal process and manager training to reduce the likelihood of their appearing before the CCMA.

The amended section 143 of the Labour Relations Act that came into operation at the beginning of 2015 reads as follows:

  1. An arbitration award issued by a commissioner is final and binding and it may be enforced as it was van order of the Labour Court in respect of which a writ has been issued, unless it is an advisory award.
  2. An arbitration award may only be enforced in terms of section (1) if the director has certified that the arbitration award is an award contemplated in subsection (1).

Court Interpretation

The interpretation of section 143(1) and (3) came under scrutiny in MBS Transport CC V CCMA and Others (Case no J1807/15 – Labour Court), and CCMA v MBS Transport CC and Others (Case JI807/15- Labour Appeal Court).

Dustin Julius (the employee) approached the CCMA to have his award enforced in terms of section 143. Once the award was certified the employee delivered same to the relevant sheriff to execute on. The employer approached the Labour Court for an order to stay the enforcement of the award pending the review of the award. The Court made the following order: “It is declared that the CCMA does not have jurisdiction to issue writs of execution in respect of the arbitration awards issued by it. Having examined section 143, and taking into consideration that the CCMA was not a court of law; the court found that the CCMA was not assigned the statutory power to issue writs.

The CCMA appealed the finding at the Labour Appeal Court (LAC). The LAC examined the history and context of section 143 and came to the following conclusion (delivered on 28 June 2016):

  1. In the original enactment of section 143 an arbitration award could only be enforced by an application in terms of section 158 to the Labour Court.
  2. This proved largely ineffective due to both time and cost factors.
  3. The 2002 amendment of section 143 provided the opportunity to issue a writ at the Registrar of the Labour Court on the strength of the certified award by the CCMA.
  4. The procedure still required the employee to approach the Labour Court.
  5. The proper interpretation of the further amendment of section 143 in 2014, that came into operation at the beginning of 2015, provided that, once an award has been certified, it could be presented to the sheriff for execution. The LAC found that the words “as it was an order of the Labour Court” in section 143(1) created a fiction that the CCMA is at liberty to issue a writ, despite the fact that the CCMA is not a court of law.
  6. The LAC held that the legislature intended to make it “easier, inexpensive, effective and accessible for a person to enforce a certified arbitration award”.

For these reasons the LAC set aside the Labour Court’s finding.

What does this mean in practice?

Any arbitration can lead to unusual results, which can now be enforced by the CCMA. It would be advisable to avoid this situation by making sure you manage your dismissal process to reduce the likelihood of being subject to the CCMA. Line managers should be trained to conduct proper pre-investigations. It might also be a good idea to make use of external specialists to chair formal disciplinary hearings of a complex nature.

Starting a Company – Tips to get you going

Editor’s Note: If you would like to talk to the Quattro team about your business structure, please email us at [email protected].

It seems as though 2016 has a rough ride in store for us but as the wise old saying has it: “Fortune favours the brave”. Just remember to mix a good dose of realism in with the bravery.

That said, if you’ve been sitting on a brilliant business idea, and if you’ve ever dreamt of leaving your 9 to 5 job and starting up on your own, this could well be your year!

Get going with these 3 steps:

  1. Consider checking first that you are suited to the excitement, rewards, risk and rough-and-tumble of entrepreneurship by taking the “Entrepreneurial Personality Profile” test on the Psychology Today website at
  2. Passed the test? Great, next step is to get off on the right foot with “Starting a Business: Ten Simple Rules for a Successful Start-up” on the Business Partners website at (Tip: Don’t ever lose sight of Rule 10 “Enjoy Yourself”!)
  3. All done? Stage 3 is to choose the right trading vehicle to suit your particular needs and those of your new business. This is important – starting off with one legal entity and then later moving the business to another type risks all sorts of unhappy legal and tax issues (quite apart from all the obvious practical ones, like wading through piles of red tape at SARS, Telkom and your bank’s “please hold, your call is important to us” call centre).

In South Africa you have these four main options to choose from:

  1. A sole proprietorship (“sole trader”). Only one owner – you are the business.
  2. A partnership of 2 to 20 owners.
  3. A private company (“Pty Ltd”) for any number of owners (“shareholders”). (CC’s – close corporations, still exist, but no new ones can be registered).
  4. A business trust (also any number of owners).

There are other specialised types of companies available only to non-profit organisations (charities and the like), and to professionals (lawyers, accountants, doctors etc.) and various ways in which different legal entities can be combined but for the purposes of the newsletter we have only referred to the 4 most common options listed above.

It is important that you do not make any decisions without first seeking professional advice on the legal and tax implications of using each type of entity. QUATTRO ACCOUNTS is an accounting services company that specialises in assisting SMME’s with bookkeeping, accounting, tax, company secretarial and advisory services.

Congratulations! Dave Beattie Completes his MBA

We are proud to advise that in July 2013 Dave Beattie, our Tax Manager, completed his Masters in Business Administration (MBA).

Dave received a distinction for his dissertation titled ‘Human Resources Outsourcing: A study of KwaZulu-Natal companies’ use of outsourced human resources services, reasons and benefits’. This dissertation provides a unique insight into the rationale followed by SMME owners in dealing with the lack of skills in the human resources field, the cost of acquiring such skills, the time commitment required by managers / owners when dealing with HR issues and the level of respect for HR legislative compliance.

Importantly, the approach used to roll out an outsourcing strategy and the evaluation of the success or failure of such a strategy is researched to identify whether KZN SMMEs measure up to their counterparts elsewhere in South Africa and overseas. WELL DONE DAVE!

HRTorQue News

Welcome back to Nicky Hardwick (HR Division) following her maternity leave. Congratulations to Steven Richman (Payroll Division) on his marriage and to Tracy Reeves (Accountant) on the birth of her son.

We also welcome Iole Matthews as an experienced coach and facilitator with particular expertise in conflict resolution and mediation. As well as having 19 years of hands-on experience, Iole has a degree through the Faculty of Education at UNISA’s Unit for Training and Development and has a Primary Certificate in Redundancy Coaching and Counselling and a Certificate in Coaching via the Centre for Coaching (UK) and Middlesex University.

Iole is an active member of CoMenSa (Coaches and Mentors of South Africa) as well as the ILM (Institute for Leadership and Management).