Youth Employment Service Initiative – Gazette 41866

Aug 29, 2018 | B-BBEE Blog

The DTI published the Youth Employment Service (YES) Initiative as Notice 502 in Gazette 41866 on 28th August 2018. The YES Initiative enables any organisation, EME, QSE or Generic to enhance its BEE Level by 1 or 2 levels by providing jobs for young black people under the YES Initiative.

In summary:

  • It amends Code 000 (General Principles and the Generic Scorecard) of the DTI Codes of Good Practice with immediate effect.
  • To qualify for registration under the YES Initiative:
    • A Generic entity must meet the 40% sub-minimum requirements of the 3 Priority Elements or achieve an average of 50% across these Priority Elements.
    • A QSE entity must meet the 40% sub-minimum requirements of the 2 of 3 Priority Elements or achieve an average of 40% across these 2 Priority Elements.
    • The Measured Entity must ensure that it maintains or improves its BEE Level achieved in the previous year.
    • An EME does not have to meet any specific requirement.
  • YES targets for Generic entities are the higher of:-
    • 1.5% of the entity’s headcount or
    • 1.5% of the entity’s average Net Profit After Tax (NPAT) over the last 3 years
    • The targets provided in a table based on revenue range from R50m = 6 youths to R500m = 15 youths.
  • Targets for QSEs and EMEs are according to a table based on headcount ranging from 1-19 = 1 youth to 799 = 40 youths
  • Eligible individuals to be hired under the YES Initiative are black people between the ages of 18 and 35.
  • They must benefit from 12 months full time quality work experience and these jobs must be created in addition to existing headcount.
  • Where the Measured Entity is unable to create sufficient new jobs, it may sponsor qualifying new jobs in EMEs or QSEs.
  • The benefit of the YES provisions is that the BEE Level of the Measured Entity can be enhanced as follows:-
    • Achieve YES target + 2.5% absorption of the youth: 1 Level
    • Achieve 1.5 x YES target + 5% absorption of the youth: 1 Level + 3 bonus points
    • Achieve 2 x YES target + 5% absorption of the youth: 2 Levels
  • It is important to note that this Gazette does not change the Priority Element compliance requirements that discount 1 BEE Level if the 40% sub-minimum requirement is not achieved. But an entity can now re-gain that BEE Level under the YES initiative and achieve a further Level by enhanced YES performance.
  • 50% of Informal Skills Development expenditure for YES employees can be included under Category F and G in the Skills Development scorecard.

Therefore, the loss of 1 BEE Level by not meeting the black ownership requirements can be overcome through the use of the YES initiative.  

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