The Youth Employment Service (YES) program was launched in South Africa in 2018 as an initiative to tackle the country’s high levels of youth unemployment.
The program provides incentives to companies that offer employment opportunities to young people aged between 18 and 35 who are not in education, employment, or training.
While the YES program can bring significant benefits to companies, there are also risks to be on the lookout for when implementing the program.
Consider these 5 risks relating to the YES program:
Compliance risk:
Participating companies need to comply with the YES program’s requirements, which include providing employment opportunities to qualifying young people, adhering to the program’s reporting requirements, and ensuring that employees receive the necessary training and development. Amongst these
Failing to comply with these requirements can result in penalties and reputational damage.
Cost risk:
While companies can claim a tax deduction of up to 50% of the total remuneration paid to qualify employees, there are still costs associated with implementing the program, such as recruiting and training new employees.
Companies need to ensure that the costs of participating in the program are manageable and that the program’s benefits outweigh the costs.
Talent retention risk:
The YES program provides companies with access to a pool of talented young people.
However, there is a risk that the young people employed through the program may leave the company after completing their tenure, resulting in a loss of investment in training and development.
Sustainability risk:
The YES program is designed to provide young people with employment opportunities and improve their skills and employability.
However, there is a risk that the program may not be sustainable in the long term, as the number of young people in need of employment opportunities may exceed the available resources.
Reputation risk:
Companies that participate in the YES program are seen as socially responsible and committed to addressing the issue of youth unemployment in South Africa.
However, there is a risk that the company’s reputation may be damaged if it fails to deliver on its commitments or if it is found to be exploiting the program for its own benefit.
Compliance requirements relating to YES:
- Eligibility criteria: Companies must meet the eligibility criteria to participate in the YES program. These include being registered and compliant with relevant legislation, being in good standing with tax and labour authorities, and having a valid Tax Clearance Certificate.
- Employment of qualifying young people: Companies need to provide employment opportunities to young people aged between 18 and 35 who are not in education, employment, or training. The employment must be in the form of a one-year fixed-term contract and must provide a minimum of 12 months of work experience, skills development, and mentorship.
- Reporting requirements: Companies need to report on their participation in the YES program, including the number of qualifying employees employed, the duration of their employment, and the amount of remuneration paid to them. The reporting requirements are set out in the YES Compliance Framework, which outlines the reporting templates and deadlines.
- Training and development: Companies need to provide training and development opportunities to qualifying employees to enhance their skills and employability. The training and development programs must be in line with the YES program’s requirements and guidelines.
- Tax compliance: Companies need to comply with tax laws and regulations, including the submission of tax returns and the payment of taxes. Participating companies can claim a tax deduction of up to 50% of the total remuneration paid to qualify employees, subject to certain limitations and conditions.
- Record-keeping: Companies need to keep accurate records of their participation in the YES program, including employee contracts, remuneration records, training and development records, and compliance reports. Use a reputable firm to assist with managing YES, starting from YES program application form 2023, the YES program online registration, to YES programme vacancies, to completion.
Conclusion:
Despite these risks, the YES program can bring significant benefits to companies that implement it. By providing employment opportunities to young people, companies can address skills shortages, improve productivity, and enhance their reputation as socially responsible organizations. However, companies need to be aware of the risks involved and take steps to mitigate them.
In conclusion, the YES program is an important initiative that can help to tackle the issue of youth unemployment in South Africa. However, companies need to be mindful of the risks involved and take steps to ensure that they comply with the program’s requirements, manage the costs of participation, retain talent, ensure sustainability, and protect their reputation. By doing so, companies can reap the benefits of the program while making a positive contribution to society.
