Youth Employment Service (Y.E.S) Initiative

Y.E.S. INITIATIVE INTRODUCED BY THE DTI

There has been an amendment to the Codes of Good Practice - Broad Based Black Economic Empowerment in the form of a Youth Employment Service Initiative on 28 August 2018 – effective immediately. 

This should be seen as an opportunity for BBBEE recognition for youth job creation.

The aim is to try and lower the unemployment rate amongst the youth of South Africa, by encouraging business entities to employ from this sector of the population, with the lure of increased BEE recognition.

YES Initiative 

There are minimum qualifying criteria that must be met by a business entity wishing to register for the Y.E.S. initiative. 

  • Generic Enterprises must achieve at least 40% sub-minimum for each of the priority elements on the Generic Scorecard, alternatively, must reach an average of 50% across the three priority elements.
  • Qualifying Small Enterprises must achieve at least 40% in two of the three priority elements, with Ownership being one of these two, alternatively, they must achieve an average score of 40% across two priority elements with Ownership being one of the elements.
  • Exempted Micro Enterprises have no sub-minimum requirements;
  • Y.E.S measured entities must maintain or improve the BBBEE status level and performance against the targets under the overall scorecard obtained in the year prior before participating in the Y.E.S. initiative.

Naturally the qualifying criteria for eligible employees is that they need to be black as per defined in the BBBEE Codes, and be between the ages of 18 and 35.

There are sub-minimum targets to comply with for Generic and Qualifying Small Enterprises in order to qualify for an enhanced recognition in terms of the Y.E.S. Initiative – which differs from each other. 

Target for Generic Enterprises:  to select the higher of:

  • 1.5% of headcount in the preceding year; or
  • 1.5% of average NPAT in the RSA operations in the preceding 3 years – converted to a headcount number:  divide NPAT/R55 000;
  • Targets as per table 1 Annexure A to the Government Gazette Vol 638 No 41866

Target for Qualifying Small Enterprises and Exempted Micro Enterprises:

  • These targets per annum are based on headcount numbers as determined in Table 2 Annexure B to the Government Gazette Vol 638 No 41866

Where the Y.E.S. targets are met, with a 2.5% absorption rate (employment of the youth), such business will qualify for an increased compliancy level. Where Y.E.S. targets are exceeded by 1.5, plus a 5% absorption rate, such business will qualify for an increased level, together with 3 bonus points.  Where double the Y.E.S. targets are met with a 5% absorption, such business entity can increase its compliancy level with 2 levels on the Scorecard.

From the above it is clear that this initiative has many advantages, but be sure to speak to your BEE professional to ensure that you will be able to draw on the benefits before embarking with this on own steam.

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