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When to say yes to the Y.E.S. Initiative
11 April 2019
 
“My business is considering supporting the Youth Employment Service initiative announced last year by Government to help improve the BEE level of my business. However, I’m struggling to find more information on how it works and how to get started. Can you help?”

On 28 August 2018 the Youth Employment Service Initiative (“YES Initiative”) was published within Code Series 000, Statement 000 of the Amended BEE Codes of Good Practice and became effective with immediate effect.

The YES Initiative in short, is aimed at creating jobs for South African youth, youth being defined as persons between the ages of 18 and 35, by incentivising entities to help create such jobs in return for benefit on their BEE scorecard.

The YES Initiative sets targets for the creation of new jobs for youth as well as their absorption. If entities meet the various requirements as well as their targets they can be enhanced by a level on their BEE scorecard and if they meet the requirements and double the targets they can be enhanced by 2 levels. 

Initially, after its publication, there was a large degree of uncertainty regarding the implementation of the YES Initiative. This led to a practice note being published on 12 October 2018 which did help clarify a number of issues but still left certain areas uncertain. On 23 January 2019 the South African National Accreditation System (SANAS), in consultation with the DTI, published a list of Questions and Answers, to deal with the remaining uncertainty.

The main points clarified by the practice note and the Questions and Answers, are as follows:

  • An entity wishing to participate in the YES Initiative must be registered with the YES Non-Profit Company.
  • Entities must maintain the BEE level that they had prior to participating in the YES Initiative. If their level drops they may engage with the DTI’s BEE Policy Unit and try to justify the drop in their level.
  • Absorption is not measured for the first year after the implementation of the YES Initiative.
  • A YES Initiative Employee cannot be placed on a Learnership, Apprenticeship or Internship for BEE purposes.
  • EMEs and QSEs cannot make use of the enhanced BEE levels obtained from the YES Initiative to improve automatic levels and would need to go through a full QSE verification in order to benefit from the YES Initiative.
  • The employee headcount at the end of the last financial year is used to determine the targets for the YES Initiative.
Although the clarifications provide more certainty, some of these clarifications may affect businesses considering the YES Initiative, particularly if the business is an EME and QSE which have automatic level recognition. These entities would now have to deal with the administration and costs involved in undergoing a full verification, and if they fail to achieve the same BEE levels they receive automatically, they would be unable to benefit from the YES Initiative. This would pose quite a risk for such entities.

However, should you wish to consider the YES Initiative, it would be useful to visit the website at www.yes4youth.co.za or alternatively to seek the assistance of your BEE advisor.