Ministry sheds more light on Employment (Amendment) Bill, 2023 |21 October 2023
PS Bresson flanked by Mr Monaie and Ms Morel during the interview
The Ministry of Employment and Social Affairs is encouraging the private sector to use the performance-based management system for evaluation of workers for 13th month pay as it will help increase productivity within their organisations.
It was the principal secretary for Employment, Veronique Bresson, who made the statement in a press briefing held yesterday morning at the ministry’s headquarters, Independence House to explain the Employment (Amendment) Bill, 2023, making special provision for 13th month pay to workers for the years 2023, 2024 and 2025, in relation to the private sector.
Amendments to the bill were approved by the National Assembly on Wednesday.
Also present for the press briefing were the director general for labour relations, Steve Monaie and the chief policy analyst, Susan Morel.
The plea for private sector engagement towards the performance-based management system introduced by government to increase productivity, follows a 45-day assessment between February and March 2022 to 250 private organisations, where it was observed the majority did not have the system in place.
The majority of them had paid the full 13th month salary to their workers with no deductions for the performance part. For some, it was their preference to pay the whole amount, while others lacked the capacity to have the system in place, including time constraints to introduce an appraisal system.
“This defeats the aim of government to have the 13th month salary to be based on performance so that we see more productivity in work places, in terms of workers producing more and as a result companies do better and the country benefits in general. We will be working with them to ensure that the system is implemented across the board,” said PS Bresson who noted that the new Employment (Amendment) Bill, 2023, will allow those who do not have the system in place, to introduce an appraisal system.
Going over the bill, PS Bresson said that among new provisions, a worker who starts employment at any month of the year, and is in employment on December 31, will be paid a proportion of their 13th month pay, covering the period in employment.
Noting that a worker whose salary is above R45,450 is not entitled for 13th pay, PS Bresson said if the employer however pays the benefit, tax will be applicable on the amount above R45,450.
Effective year 2024, a worker who leaves employment during the year will also receive a proportion of the 13th month pay as part of its final dues. The proportion will be calculated on the 50% mandatory part. An employer will be compelled to provide its workers in writing, details of all deductions made on the workers’ 13th month pay. However if the worker’s departure was due to disciplinary reasons, is still on probation or has failed probation, the worker will not benefit.
The 13th month pay, which resumed in 2022, will remain as is with 50% payment being mandatory and 50% performance based for the period of 2023, 2024 and 2025 before becoming 100% performance based as of 2026. Due date for payment remains at every December 31 and employers have until January 31 of the following year to pay their workers.
The 13th month pay remains applicable only to Seychellois workers, and categories of workers not qualified are non-Seychellois workers, trainee on contract for Skills Development and workers whose basic salary is above R45,450.
With regard to payment pro-rata, if a worker proceeds on training for more than 14 weeks or on unpaid leave for more than one month, the worker will receive a proportion of the 13th month pay excluding the period on training or unpaid leave. A worker who is detained in police custody or on remand, will receive a proportion of the 13th month pay, which will exclude the period in detention or on remand.
An employer can make deductions on the 13th month pay of a worker. This is applicable in instances where the worker is absent without authorisation. For example, a worker who has not reported for work for one day due to medical reasons however, without producing a sick leave certificate. Then the employer can deduct equivalent to one day’s salary on the 13th month pay. After this deduction, the employer must automatically pay the worker 50% of the remaining amount.
On the other remaining portion of 50%, the employer can make further deductions however this will be possible only if the worker’s performance is appraised. An employer will be compelled to provide its workers in writing, details of all deductions made on the 13th month pay.
Any authorised leave under employment law entitled by a worker such as maternity leave, paternity leave, annual leave, compassionate leave and sick leave, should not be used as a criteria or factor to measure performance or productivity under an employer’s performance appraisal system, in relation to 13th month pay.
PS Bresson said that an employer who does not have a performance appraisal system in place, before December 31, or who has not conducted performance appraisal of its workers before January 31, must pay the worker its 13th month pay in full, equivalent to one month’s basic salary, taking into consideration the legal deductions.
“It is to be reminded that the 13th month pay is 100% payment achievable but it has to be earned through hard work. Sensitisation on the amended law will continue to be done so that workers and employers each know their responsibility so that the law is correctly followed,” PS Bresson said.
It is to be noted that consultations were undertaken with relevant stakeholders, including workers and employers. On the workers’ side their wish was for it to return to 100% mandatory, otherwise it should be kept at 50% mandatory and 50% performance-based. For employers they indicated that the 13th month pay should be abolished altogether while they get to decide on the mode and amount for payment, otherwise make it 100% performance-based.
PS Bresson said that it was the reason why, as the way forward, government decided to keep the same system as was applicable for 2022, that is 50% mandatory and 50% performance based, together with the existing in addition to the new provisions in order to allow more workers to benefit.
A worker who does not agree with the percentage given after its performance appraisal, can register a grievance at the Employment department.
Compiled by Patrick Joubert