National QualiÞcation Framework Bachelor of...

National Qualification Framework

Bachelor of CommerceBusiness Management

Accredited and offered

by

The Da Vinci Institute for Technology Management

ModuleHRM100

Human Resource ManagementIntroduction & Orientation

The material within this document is the intellectual property of Quintave Managerial Leadership System, a Research associate of DMC Process & The Da Vinci Institute for Technology Management. This Module was exclusively developed and forms part of BCom Business Management. Dissemination of this material to a third party or use of this material outside of the scope of the qualification, will constitute a violation of the intellectual property rights of The Da Vinci Institute for Technology Management (Pty) Ltd and DMC Process Management (Pty) Ltd and Quintave Managerial Leadership System. The Collective owns all compilation copyrights in these materials. Each portion of the compilation material is subject to pre-existing copyright owned separately by the respective member of the Collective.

© 2013

BACHELOR OF COMMERCE

BMG100 BUSINESS MANAGEMENT

The Da Vinci Institute for Technology Management (Pty) LtdRegistered with the Department of Education as a private higher education institution

under the Higher Education Act, 1997. Registration No. 2004/HE07/003

BACHELORS OF COMMERCE

NQF Level 5

BMG100

HUMAN RESOURCE MANAGEMENT

INTRODUCTION &

ORIENTATION

On completion of this module the student should be able to:

1. Describe the scope, function and tasks of Human Resource Management in the workplace;

2. Discuss underlying theories and philosophies that guide Human Resources Management;

3. Apply the principles of emotional intelligence to develop personal mastery;

4. Discuss the concept and benefits of diversity in the workplace; and

5. Explain the role of change, stress and time and the impact on work-life balance.

BACHELOR OF COMMERCEBMG100 BUSINESS MANAGEMENT

4 | MANAGERIAL LEADERSHIP ODYSSEY | THE DA VINCI INSTITUTE | BUSINESS MANAGEMENT

Reading

You will be provided with a series of national and international articles and literature to read that will help you broaden the subject at hand. All articles can be found in the Module Libraries.

Self-Reflection

Research

As you work through the module you will be required to do your own research.

Take Note

A useful tip or essential element regarding the concept under discussion.

Activity

You will be given a number of activities to complete to prepare you for your post-module assignment. These need to be submitted as they will count towards your final mark.

Post Module Assignment (PMA)

Ratiocination

Ratiocination is the logic reasoning that considers all alternatives and possible impacts that may result from a decision or a possibility.

Submission Date

Group Work

You will be required to do group work both in the class room and as syndicate study groups.

Learning Outcomes

Group Discussion

Talking to others while you learn will often illuminate a topic for you.

iAssess

My Notes


BMG BUSINESS MANAGEMENT

BUSINESS MANAGEMENT| THE DA VINCI INSTITUTE | MANAGERIAL LEADERSHIP ODYSSEY | 5

1. Introduction and Orientation

Organisations often refer to their employees or human capital as the most important asset. Effective human resource management (HRM) is of utmost importance in any organisation to achieve its vision and strategic objectives. However there is a cause and effect relationship between an organisation’s financial health and people's happiness. It is difficult to sustain a financially healthy organisation with unhappy people. Such an organisation may likely end up in financial trouble. On the other hand, a financially unhealthy organisation has a far better chance of success if it has happy people. This implies that if human resources are in place, satisfied and productive, the financial and other resources will also fall into place.

In an attempt to ensure it has satisfied and productive employees, the primary focus of the organisation should be on its people and their performance and productivity. This is part of the role of the HR team in the organisation. The following principles should guide the organisation, its managers and the HR team in ensuring they have satisfied and productive employees (adapted from Grobler, Wärnich, Carrell, Elbert and Hatfield, 2006:5):

๏ All employees are valuable and are investments.

๏ Satisfied and rewarded employees will be productive and add value to the organisation.

๏ Both the economic and emotional needs of employees should be addressed through clear and relevant policies, processes and practices,

๏ A conducive working environment will lead to:

๏ A healthy team and employee relationships;

๏ Continuous development of skills; and

๏ Continuous improvement of practices and behaviours.

Based on these aspects both the organisation and the individual employee need to take responsibility for their respective roles and responsibilities in this working relationship. It means that if an employee is motivated, skilled and capable, he/she will focus on quality of work and higher productivity levels. High employee productivity should lead to high levels of organisational productivity and ultimately this should lead to greater reward and recognition for employees.



The impact of a positive working relationship between an organisation and an employee

Source: Adapted from Grobler, Wärnich, Carrell, Elbert and Hatfield, 2006:5

2. The Concept of HRM

The exact meaning of terms used in the field of human resources, are not always clear. To avoid confusion and uncertainty about the exact meaning of important terms in the field of human resources, they are explained in more detail in this part of the chapter.

Human resources management refers to activities, policies, beliefs and the general function that relates to employees.

They describe the elements contained in the definition as follows:

Human resources activities: are performed by the human resources department such as the learning and development of a group of employees or a recruitment campaign.

Human resources policies: are formalised official guidelines for the management of people in an organisation.

Human resources beliefs: are the convictions of executive management with regard to people. These beliefs or convictions are one of the most important elements of organisational culture.

Employee

Organisation

Higher motivation and applied

ability

Greater quality and quantity of work

Greater reward and recognition

Human Capital

Higher Organisation Productivity




Human resources management function: a function is a group of unique activities. The human resources management function indicates all human resources management activities within an organisation.

Human resources department: this is the physical place where employees responsible for human resources management activities are found.

Human resources practitioner: employees, irrespective of their appointments, who deal with the execution of human resources activities, such as a human resources manager, or recruitment practitioner.

Reading

Reading 1: The Role of Line Management in the Basic Human Resource Value Chain or Functions

Reading 2: The Human Resources Value Chain

3. HRM as an Applied Science

HRM is concerned with strategic aspects and involves the total development of human resources within the organisation.

It is involved in the broader implications of the management of change and not only with the effects of change on work in practise. Human resources management aspects are an important input for organisational development.

The function determines the general policy for employment relations within the organisation.

HRM can therefore be described as applied management science that is closely related to a sister science, industrial psychology. From an industrial psychology perspective human resources management may be regarded as the implementation of policies, customs and procedures with regard to the human being as an employee on the basis of psychological principles.

To emphasise the psychological foundation of human resources management, it can be redefined as a management strategy related to one of the means of production of the organisation, i.e. its labour. From this perspective, human resources management consists of three general functions (Gerber, Nel, Van Dyk, 1998)



๏ Human resources utilisation, which includes recruitment, selection, transfers, promotion, appraisal, training and development

๏ Motivation of the human resources factor which includes work design, remuneration, fringe benefits, counselling, participation and equal rights;

๏ Protection of the human resources factor, which includes working conditions, welfare services, safety and the formalisation of policy regarding the assurance of employee interests after retirement.

Every functional (line) manager – each department head, foreman and supervisor – is responsible for the management of employees. This means that every manager must provide guidelines for his/her immediate team member. He/ she must set objectives with and for them, delegate responsibility to them, measure their performance and provide them with feedback. This responsibility forms part of human resources utilisation.

On the other hand, human resources management, like finance, marketing and supply chain management (SCM) is a specialised function that provides support services for other managers in the organisation, to enable them also to make optimal use of their subordinates.

Reading

Reading 3: A seat at the table

Reading 4: The Line Manager as a People Manager

4. HRM and the organisation

The focus of HRM is on the integration of the HRM strategy into the global strategy of the organisation as human resources are the only dynamic production factors an organisation has. By implication, as part of the global strategy HRM must take cognisance of:

1. The external environment

Every organisation exists and functions within an external environment. This external environment consists of four (4) primary sub-environments (also known as the PEST environment):

๏ Political environment;




๏ Economic environment;

๏ Social environment; and

๏ Technological environment.

The political environment is particularly important in the present South African context. Every organisation is run according to laws and regulations, whether they originate at central, provincial or local levels. These laws and regulations influence any organisation from its external environment, no matter what the nature of the business is.

The economic environment is recognised as the external influences that have an effect of an organisation, such as:

๏ Availability of capital;

๏ Current interest rates;

๏ Rate of inflation;

๏ Strength(or weakness) of the competitors of the organisation;

๏ Level of employment (Whether it is above or below average).

The social environment is shaped by the society in which the organisation operates. Potential customers and employee of the organisation, with their attitudes and values about work, products and business, their educational and skills levels, and their expectations are integral parts of the social environment. To prosper, the organisation must achieve a fine balance between meeting the needs of the employees and customers and meeting its own organisational goals.

Now, more than ever, the technological environment has an influence on management philosophy, not only in South Africa, but in the whole African and global context, since there is a positive correlation between the technology in use and the productivity of a community.

Technology essentially means the way in which an organisation changes the inputs (raw materials in whatever form is available) into outputs (products or services) by means of a transformation process.



With an understanding of the external environment we now move on to the internal functioning of the organisation.

2. The Organisation

An organisation has a number of characteristics. One obvious characteristic is size; some people have strong preferences about the size of the organisation they want to join.

Organisation also differs in their structure. Some are hierarchical while others are structured according to certain functional preferences.

Another key characteristic of organisations is the technology, which governs how work is done; this determines the profiles that employees must match.

The organisation’s human resources policies show its orientation towards people and play a major part in attracting and satisfying employees.

Finally, the culture of the organisation is of particular importance. This indicates the way in which things are done in an organisation and is also known as the personality of the organisation. For the success of an organisation it is particularly important that the individual employee’s values and the values of the organisation are aligned. A mismatch can hamper the attainment of both personal and organisation goals.

3. The work (job) itself

An individual employee joins an organisation by virtue of his or her potential for reaching personal goals in that organisation by supplying work and work potential. The basic motivation of a person in this context is that he or she sees the opportunity of satisfying his or her intrinsic and extrinsic needs

Among the key characteristics of jobs that directly affect employee performance and satisfaction are the degrees of challenge, variety, and autonomy they offer to employee. Challenge is the level of difficulty of a job’s tasks and activities. Variety refers to the number of different tasks and activities included in the job, and autonomy is the extent to which an employee works independently on a job.

4. The individual employee




Finally, each individual brings a unique combination of attributes to an employer. Some personal characteristics that cause people to succeed or fail on a job are their abilities, knowledge, personality, values and expectations. Abilities and knowledge determine an employee’s potential to perform specific jobs successfully. Personality, values and expectations are related to an individual’s preference for different kinds of jobs and organisations and therefore determine the choice of a specific job or employer

5. The Role and Function of HRM in an organisation

Human resources management is a purposeful action of the human resources department aimed at assisting functional manager in the optimal application and utilisation of the human resources under their control, in accordance with official organisational policy as well as human resources management policy and application in practice, in order to achieve the goals of the organisation.

1. HRM Objectives

Like any other organisational function, the human resources department requires focal points or objectives to direct the diverse mature of the activities to be carried out. Three general human resources management objectives are universal:

Objective 1: To establish the belief that the human resources of an organisation consist of unique individuals who can make a meaningful impact of the success of the organisation.

This objective is usually reflected in the human resources vision or mission of an organisation.

You might reason that this objective is an obvious one in modern organisations. This is, however, not the case; many organisations in South Africa, seen from a multi-cultural point of view, still disregard this important principal. Employees are still treated as “machines” and their contribution is regarded as unimportant for the success of the organisation. The contemporary view that people are the most important assets of an organisation is relatively new. The general acceptance of this principle does, however, give rise to individual employees having an optimally positive attitude towards performance.

Objective 2: Establishing how employees and organisations can adapt to each other to the advantage of both parties.

This objective is linked to the first objective. If employees are unique components of organisational success, modern organisations should react in flexible manner and adapt to the diverse needs of employees. The divergence of individual employee needs may be been in the conditions of service of modern organisations.



Objective 3: The support by human resources managers of other line and staff managers in the execution of their tasks related to human resources management and the management of people.

The main theme of this module is to highlight the contribution to organisational success made by the human resources management function as well as the role of the managers.

2. The HRM Function

Within the organisational frame work of the organisation the human resources function manifests itself as a human resources department. The human resources function of an organisation refers to a number of functions carried out in order to achieve the goals of an organisation. The human resources function is carried out by a human resources department responsible for the organisations human resources management activities. This department also gives advice and assistance to the rest of the organisation.

The human resources function is therefore a staff function aimed at providing the organisation with labour, and giving it specialised human resources services to help it to achieve its goals. The human resources function should be flexible by implication, and the physical embodiment of this function depends on the nature of the organisation in terms of its size, products, services and geographical location. The human resources function includes the following:

๏ Human resources provisioning, comprising human resources planning, recruitment, selection, placement, induction and career management.

๏ Human resources maintenance, comprising the determination of conditions of service, remuneration structures, record keeping, personnel turnover, settlement of disputes, advisory services, employer-employee relations, social responsibility, affirmative active and performance assessment.

๏ Human resource development, comprising training and development as its most important activities.

3. Responsibilities and functions of the HRM function

The responsibilities of the HRM function are as follows:

๏ Wage and salary surveys to ensure that the organisations wage and salary levels are aligned to industry.

๏ Development of incentive schemes e.g. compensation systems to increase employee efficiency




๏ Implementing pension schemes

๏ Maintaining employee details and statistics

๏ Preparing job descriptions and other recruitment aids

๏ Implementing health and safety regulations, accident prevention and first-aid facilities

๏ Managing training, development and succession planning

๏ Employee communication, i.e. sending out important information to employees through newsletters, notice boards and information sessions.

4. The function of the human resources manager

Theoretically, three functions may be distinguished:-

The service function incorporates the everyday tasks of a HRM department such as recruitment, selection, remuneration, training and health and safety activities.

The control function is more strategic in nature and incorporated activities such as:

๏ An analysis of key human resources management outputs such as labour turnover, productivity, absenteeism, resignations;

๏ The recommendation of appropriate corrective action by line managers, such as training and development, dismissals and transfers.

The advisory function is associated with the expert advice given by the human resources department regarding human resources policy and procedures with regard to matters such as

๏ Which employees are ready for promotion

๏ How a grievance procedure should be carried out

๏ How service contracts, health and safety regulations should be carried out.

With a better understanding of the concept of HRM we will now explore how HRM can contribute to the success of an organisation.



Discussion

Critically discuss the extent to which the HR department in your organisation actually contributes to the successful functioning of the organisation as well as its specific contribution to the value chain.

Refer to the Value Chain Article you facilitator will hand out to you

6. HRM and the success of the organisation

The success of an organisation means the extent to which it succeeds in achieving its organisational goals, as measured against specific set standards of achievement. According to the systems approach to organisation, organisations have multiple goals. To be successful, they must therefore work towards the optimal achievement of multiple goals.(Gerber, Nel and Van Dyk, 1998)

According to them, the goals of an organisation are usually divided into three broad categories: long, medium- and short-term goals.

๏ Long-term goals focus on the organisation’s ability to adapt to changes in the economic situation, technological development, social responsibilities, statutory and political responsibilities, human resources requirements, etc.

๏ Medium term goals are formulated to fill the gap between set long- and short-term goals; for example, to increase market share by 30% over a period of three years, at a rate of 10% per annum.

๏ Short-term goals are set, measurable goals with regards to production (for example returns, sales, market share); efficiency (for example labour costs, unit costs, refuse and waste) and employee satisfaction (for example morale, attitude, labour turnover, absenteeism, fatigue, grievances).

7. Current Issues and Challenges

HRM is influenced and impacted by a number of issues and challenges. Organisations should be aware of these issues and challenges in order to pro-actively address them.




1. Talent management

One HR challenge is how to attract, retain, motivate and develop individuals with talent. And, if that is not enough of a challenge, consider the impact a turbulent business environment presents, the difficulty of managing a diverse work force, and the ever-changing legal climate and government regulations. The external environment presents, at times, a bewildering array of challenges. What are these external challenges, and how have South African companies responded?

2. Worker Productivity

One of the biggest challenges facing South Africa since its re-entry into the international community is its labour productivity. South Africa has one of the lowest productivity rates in the world, which complicates the issue considerably.

Due to the General Agreement on Tariffs and Trades GATT agreement, more international goods enter South Africa which affects local companies severely. This means that the productivity in local industries will have to improve by leaps and bounds. South Africa still has a long way to go if it wants to become a world player.

However, it is heartening to see that many companies are turning themselves inside out to stay competitive. One radical step many have taken is calling on all the workers abilities and genuinely democratising the workplace to do so. Companies are abandoning management practices that have often let alienation replace motivation in the workplace. Hierarchical systems designed to command and control workers which divided work into small, easily supervised tasks, is becoming obsolete – except in government. Companies are cracking down on excessive absenteeism, high defect rates, and idleness on the job by picking, training and rewarding subordinates differently.

Other approaches are used as well. Self-managed teams are being implemented. Typically a team replaces the supervisor by controlling everything from scheduling to hiring and sometime firing. Building flexible teams is what empowerment is all about. While HR professionals will play an important role, line managers will be expected to spend more time on HR issues. That will create yet another challenge: how to train and develop the great mass of operating and general managers to assume HR responsibilities.

3. Quality Improvement

South African employers fully recognise the importance of quality in the workplace. Although it may have been the Japanese who shocked companies out of their complacency, the quality



focus today is less of an “us versus them” mentality and more of a new philosophy: excellence should be the norm, not the exception.

Improved quality means survival. As trade barriers come down, worldwide competition will intensify. Only companies with the best quality will thrive – and not because of quality alone. Two by-products of making or doing things better are almost always lower costs and higher productivity. Quality means confirming to customer requirements, preventing errors and accidents, and striving towards error-free output. A quality orientation signals an important change in company culture. It involves more than a technical function or department. It is an operating system that extends throughout the organisation. In the past, quality efforts in South Africa suffered from a lack of top management commitment but luckily this attitude is changing fast. Getting employees to support quality efforts can be a major challenge. Too many workers and managers dismiss quality efforts as inappropriate to their tasks until they are convinced that such efforts produce important results.

Critical success factors in quality improvement are education and training, teamwork, employee involvement, and so on. The common thread evident in all successful programmes, however, is a strong companywide commitment involving all levels of management and labour in all departments and functions.

4. Downsizing and unemployment

No matter what you call it, as companies trim costs they are retrenching employees at a pace reminiscent of that of the Great Depression. These massive layoffs are not taking place in South Africa alone; more than half of Europe’s largest corporations plan to cut their workforces as global competition and high wages take their toll. This is also the trend in the rest of the world.

Companies cite many reasons for cutting payrolls; plant and store closings, cost cutting measures, restructuring, slowdowns in, for example, military programmes – which has had a major impact on arms manufacturing companies like Denel, in South Africa – and acquisitions. And it isn’t just low – or unskilled workers who are being let go. Retrenchments facing people once thought to have very marketable skills.

5. The Changing Workforce

The demographics of South Africa’s workers are creating a new diverse, changing workforce. There are more single parents, working couples, women and minorities. According to figures provided by Statistics South Africa, South Africa’s economically active population in the latest census was estimated at 14 497 000 with 414 000 Asians, 1 509 000 coloureds, 2 496 000 whites and 10 078 000 blacks. The total population during this year was estimated at 50.59 million.




How does such a diverse population view work, management and the future? And what are companies doing to meet the changing demographics and the growing emphasis on worker competitiveness?

According to the results of studies undertaking in various South African companies recently, it is clear that in many companies the trust gap between employees and employers is widening. These results are understandable as mainly government and quasi-government departments, as well as numerous city councils and companies have all undergone drastic restructuring. As a result of this process, thousands of employees on all levels have either been given early retirement, or retrenchment packages resulting in a loss of enthusiasm, commitment, loyalty and trust, and increasing stress and guilt amongst the survivors. However, while overall trends are discouraging there are still many companies in South Africa where job loyalty is strong.

Another constant challenge for companies is workforce diversity. While laws are in place and gains are being made, progress across ethnic groups is still slower that it ought to be. There is evidence that today’s workers are not better equipped to cope with a more diverse workplace than were their parents. Many companies are trying to rectify this situation by means of training programmes, including sporting events.

Gender discrimination continues to occur. Although progress is also being made, there still exists a “glass ceiling” for women who aspire to tope management. Although many more women are working today than in the past, women managers perceive their career opportunities as far fewer than those of their male colleagues. But society may have turned at least one corner regarding gender. Workers preference for male managers is declining in South Africa as well as internationally. The typical male employee, for example, is just as comfortable working for a female manager as for a male manager, and vice versa.

With more single parents and dual-career couples, balancing the demands of home and work has become the great challenge of the typical South African worker and his or her employer. When there is conflict between work and family, the family is three times more likely to suffer than the employee’s job performance. But how productive can an employee really be when there is a sick child at home with a sitter, or when an aged parent is hospitalised and long-term care in needed, or when a spouse is told of an impending job transfer to a remote location? Companies are discovering that family-friendly work environments more than pay for themselves. Companies have discovered that “workplace flexibility is not an accommodation to employees but a competitive weapon” Absenteeism is reduced, turnover is cut, efficiency is improved and the bottom line is more attractive.

Perhaps the biggest challenge is persuading managers not to penalise employees – many of them single parents – who miss work because they have to tend to sick children. There is also some



resentment among childless workers, many of whom feel exploited because they perceive themselves losing out in benefit packages that favour families with children. Childless workers complain that they are automatically given the most time- consuming assignments, or targeted to go out of town or work weekends. And while maternity leave has become a standard benefit, personal leave for serious matters unrelated to having children is much harder to win. Experts are in agreement on one thing: Any solution that addresses both productivity goals and help in family situations must involve work flexibility. For example, telecommuting, job sharing and time compression (working four-day, forty-hour weeks) makes a lot of sense for people with families, as well as for increasing numbers of employees without them.

Evidence is beginning to show that companies are getting better productivity and good results not by ignoring workforce diversity and workers personal needs but rather by specially addressing them.

6. Global Economy

The changing global economy is placing new and increasing demands on the human resources in South African companies. This marketplace is marked by increased competition worldwide; a new European economy, expanding Asian markets, a reformed Russia and a reformed Central Europe, a developing South America and a capita-rich Japan. The new global economies have brought competitive changes unequalled in South African history. South African companies must match foreign competition if they are to take advantage of the opportunities presented by new markets in Asia, Latin America and Europe. As international operations, workers in South Africa are continually measured against those of other nations, not only in terms of the products and services they produce, but also in terms of their skills and motivation. According to the World Competitiveness Yearbook, South Africa’s position does not look promising. For example out of a total of 46 countries we obtained an overall raking of only 44 Globalisation brings new opportunities, such as joint ventures, but it also puts increasing pressure on South African workers and management to meet the challenge presented by foreign competition. New trading agreements and national partnerships will have great impact of the South African economy. The 1992 unification of the European market, the US Canada Trade Agreement, the North American Free Trade Agreement and Chin’s takeover of Hong Kong in 1997 are examples of dynamic shifts in world markets that will create shifts of capital and workforce.

7. The Impact of Government

Since 1994, with South Africa’s new democratic government, the HR profession has felt the great impact of government policies and programmes. These include the implementation of the Labour Relations Act, No 66 of 1995, the Mine Health and Safety Act, No 29 of 1996, and the occupational Health and Safety Act No.85 of 1993, which was passed by the previous




government. Other issues that will be the subject of new government laws include the Basic Conditions of Employment Bill, 1997, and the green paper on a New Employment and Occupational Equity Statue (both to become law during 1997) and the National Health Bill, affecting a number of issues, amongst others, a national health system, and the green paper on a skills development strategy for economical and employment growth in South Africa.

Today, human resources management strategies should be integrated with organisational plans and should be in line with the broad organisational strategy. The human resources function is concerned with much more than filing, routing administration actions and record-keeping activities. Its main role should be that of strategic partner and human resources strategies should clearly demonstrate the organisation strategy regarding people, profit and overall effectiveness.

The emphasis on accountability is even more important if one considers the legal environment in which decisions related to human resources have to be taken and the very negative consequences for the organisation if the right decision is not made.

If, for example, the correct procedures as prescribed by the Labour Relations Act (No. 66 of 1995) are not followed in the event of a retrenchment, the consequences for the organisation can be dire.

Every manager in the organisation should realise the importance of recruiting, selecting, learning and development, developing, rewarding, assisting and motivating employees. However to achieve organisation success both locally and internationally, the focus should be on integration and team work among employees.

The final element in this section is employee engagement. You are encouraged to work through the articles provided on this topic in the Readings.

Readings

Reading 5: How to hang on to your High Potentials

Reading 6: How to cultivate Engaged Employees

Reading 7: Pride and Professionals - Retaining Talent in Emerging Economies

Reading 8: Trends in Global Employee Engagement

8. Overview of the Legislative Environment



As we saw earlier, a number of environmental factors influence how human resources are managed in an organisation. One of the most important factors is the legal environment and specifically the plethora of laws applicable to people in organisations in South Africa.

Legislation affects all aspects of HRM and it is quite complex. it therefore imperative that any manager has a good understanding of these laws. In this next section we will unpack the essence of the Constitution of South Africa and specifically the labour laws that support it.

1. The Constitution of the Republic of South Africa Act (No.108 of 1996)

The Constitution of 1996 is the single most important piece of legislation in South Africa. As its name implies, it sets out the structure of the state. It provides for national government, the legislature, the judiciary (the courts of law) and the executive arm of government. When it comes to the courts the Constitution of 1996 provides that the Constitutional Court is the highest court in respect of constitutional matters (this means that the Constitutional Court is the highest court that can hear a matter relating to, for instance, an infringement of fundamental rights). But when it comes to human resources management, the most important part of the Constitution of 1996 is the Bill of Rights the Bill of Rights protects a number of important fundamental rights. Section 23 of the Constitution of 1996 relates specifically to labour rights. Everyone has the right to fair labour practices, for example, and employers and trade unions have the right to organise and bargain collectively. Employees have the right to join a trade union of their choice (this is called freedom of association) and provision is made for the right to strike.

But it is not only these fundamental favour rights that have a direct impact on the workplace: other rights are as important. Section 9 of the Constitution of 1996 provides that no-one may be discriminated against unfairly and section 22 protects the right to choose a trade, occupation or profession freely.

The fundamental human rights contained in the Bill of Rights are formulated in a wide and general way. In most cases, specific pieces of legislation give further effect to these rights. In this way, the Labour Relations Act (N066 of 1996) gives effect to the fundamental favour rights contained in section 23 of the Constitution of 1996 and the Employment Equity Act fives further effect to the right not to be unfairly discriminated against in the workplace. The most important recent development relates to the right to fair administrative action, enshrined in section 33 of the Constitution of 1996. Again this fundamental right has its own specific piece of legislation: the Promotion of Administrative Justice Act (No 3 of 2000). One of the important questions that have arisen is whether employees in the public service (where the state is the employer) have additional rights and remedies in terms of the promotion of Administrative Justice Act. It seems that South Africa’s course are now tending towards the view that workplace issues in the public service, especially dismissal of a public service employee, must also comply with the provisions




of section 33 of the constitution of 1996 as given effect to by the Promotion of Administrative Justice Act.

Another important point in respect of fundamental rights is that none of these rights are absolutely unlimited. Section 23 of the Constitution of 1996 provides for a right to strike, but the Labour Relations Act places certain limitation on this right. Employees engaged in essential services for example, may not strike. Furthermore, the Labour Relations Act also imposes a number of procedural requirements on strikes.

Constitutional rights

Section 23 of the Constitution of 1996 provides that every employee has the right of freedom of association. This right is further given effect to in the Labour Relations Act. But this does not mean that an employee engaged in mining activities can choose to join a union representing workers in the chemical industry. The employee’s right of freedom of association is limited by the union’s constitution: the union’s constitution will set out which employees are eligible to join that union.

2. Laws affecting business activities

Many laws affect business activities in South Africa. Laws of this nature are found in most countries. There are laws to regulate the form and functioning of businesses, such as the Companies Act (No 71 of 2008). These are laws that provide for various forms of tax ranging from value-added tax and income tax to company tax. There are laws dealing with intellectual property (copyright and trademarks), laws dealing with insolvency and even some laws dealing with specific forms of contracts. This means that the labour laws are just one set of laws a business has to take into account. Many other laws impose direct or indirect duties or obligations on a business. When it comes to the management of people in organisations, the most important pieces of legislation are the Labour Relations Act (No 66 of 1995) (usually simply referred to as the LRA) and the Basic Conditions of Employment Act (no 75 of 1997) (the BCEA). Other important laws include the Employment Equity Act (No 55 of 1998) and other laws relating to skills development and workplace health and safety. The sections that follow look briefly at the most important of these laws.

In some cases, it may be necessary to look at the entire piece of legislation. Most human resources managers have a copy of the LRA on their desks. Because the labour laws are changed (amended) from time to time, it is important to ensure that a manager refers to the correct version of the legislation. A number of important changes were made to the LRA in 2002 and some new provisions were included. A manager must therefore make sure that the version of the LRA he/she refers to contains all the amendments. The BCEA was also amended in 2002.



Similar considerations therefore apply: a manager must ensure that the version of the legislation consulted is up to date.

The discussion of the acts given in this chapter is brief. If further information about these acts is required, it is probably better to study the specific act in its entirety.

3. The Labour Relations Act (No 66 of 1995) (the LRA)

Since the first democratic election in South Africa in 1994, the labour dispensation has changed significantly. Organised labour has played an important role in South Africa’s transformation process. Not only do workers through their trade unions, play a key role in the redistribution of wealth through collective bargaining over wages, but they are also instrumental in the broader socio political process of transforming South African society. Consequently, the system of labour relations in South Africa has seen tremendous changes. For example, a new Labour Relations Act was introduced in 1995. A new Basic Conditions of Employment Act and a new Employment Equity Act were introduced in 1997 and 1998 respectively. Before 1994, labour legislation was made and brought into effect by government alone. The process leading up to the passing of the LRA was therefore unique. For the first time, labour legislation represented basic consensus or agreement between organised labour, organised business and the state.

The implementation of sound labour relations in businesses not only ensures fair labour practices, but also contributes to organisation success. Labour relations from a business-management point of view, may be described as a complex system of individual and collective actions as well as formal and informal relationships that exist between the state, employers employees and related institutions concerning all aspects of the employment relationship.

Relationships in a business are considered to be a crucial element in labour relations. More attention is given to the different parties in the labour relationship in the next section.

The parties involved in the labour relationship are the employer and employee as primary parties, and the state as a secondary role-player. The state’s role is to provide, by means of legislation a framework within which the primary parties can conduct their relationship. Basically employees in managerial positions represent the interest of the owners of businesses in the workplace. In the private sector, this essentially means safeguarding and improving the profitability of business. The state’s primary role is, as stated, to provide the framework or infrastructure within which labour and management can conduct their relationship.

A trade union is a permanent organisation created by workers to protect themselves at work, to improve their working conditions through collective bargaining, to better their quality of life and to provide a means of expressing their views on issues in society.




In day-to-day human-resources management, the LRA is the single most important piece of legislation, especially because it contains the rules relating to dismissal of employees. But it is worth repeating that the LRA gives effect to all the fundamental rights contained in section 23 of the Constitution of 1996 and it therefore deals with a large number of issues. It is wide in scope, which explains why the LRA is so long (there are 213 sections in the LRA and numerous schedules). The purpose of the LRA is set out in section 1. Including giving effect to and regulating the fundamental rights contained in the Bill of rights and providing a framework with which employees, their trade unions, employers and employers organisations can engage in collective bargaining and formulate industrial policy. The purposes of the LRA also include the promotion of orderly collective bargaining and the effective resolution of labour disputes.

Freedom of Association: Freedom of association means that employees have the right to form a trade union or to join a trade union of their choice. They also have the right to participate in the lawful activities of a trade union. The protection of freedom of association in the LRA must be seen within the context of the fundamental right of freedom of association contained in section 23 of the Constitution of 1996. Employers have a similar right: to form or to join an employer's organisation. These rights of association (the foundation of the notion of collectivism) are recognised in most modern labour relations systems and they are also enshrined in the international labour standards of the International Labour Organisation (ILO).

Organisational rights: Trade unions may apply for and exercise certain organisational rights in respect of the employer’s premises or the employers operations. Provision is made for the trade union to gain access to the employer’s premises to recruit members, to communicate with members or to represent member’s interest. Unions may hold meetings at the employer’s premises after hours. This organisation right is not unlimited, of course: the union’s right to gain access to the employer’s premises may be subject to conditions regarding time and place that may be necessary “to safeguard life or property or to prevent the undue disruption of work”. The right of access to the employer’s premises is just one of a number of organisation rights provided for in the LRA. Other organisational rights include time off for trade union activities, the right to a trade union to have trade union dues or subscriptions deducted from employees’ wages or salaries, and the right of a trade union to information it needs when consulting or negotiating with the employer.

An employer and a trade union are engaged in wage negotiations. In response to the unions demand for an 8% wage increase for all employees who are paid on a weekly basis, the employer responds that it cannot afford an 8% increase because business has not been as good as it expected. The union challenges this statement, saying that productivity and sales have increased. The union then demands to see the employer’s financial statements, but the employer responds by saying that this information is for thee employer only. Section 16 of the Labour



Relations Act provides that in this kind of situation, a trade union representing the majority of employees in a workplace has the right of access to certain kinds of information that are relevant to the negotiations. If, however the union were to demand to see details of the remuneration of senior executives the employer may respond that this information is private and personal information (one of the exceptions to the union’s right of access to information in terms of section 16 of the LRA)

Bargaining and Statutory councils: Large parts of the LRA focus on collective bargaining. Bargaining councils are bargaining and dispute resolution structures introduced by the Act. They are centralised at sectorial level. One or more registered trade unions and one or more employer’s organisation may form a bargaining council. The union and the employers’ organisation agree to the council’s constitution and the council is the registered. The powers and functions of bargaining councils include the following:

๏ The conclusion of collective agreements

๏ The enforcement of collective agreements

๏ The prevention and resolution of labour disputes

๏ The performance of dispute functions set out in the Act

๏ The establishment and administration of a fund to be used for resolving disputes

๏ The promotion and establishment of training and education schemes

๏ The establishment and administration of funds related to pension, provident, medical aid, sick pay, holiday, unemployment schemes, or other schemes or funds for the benefit of one or more of the parties to the bargaining council or their members

๏ The determination, by collective agreement of the matters that may not be an issue in dispute for the purpose of a strike or lock-out at the workplace

๏ The consideration of workplace forums or additional matters of consultation

A representative trade union (or more than one, coming forces) with members who constitute at least 30% of the employees in a sector, or one or more employers organisations, may apply to the Registrar (Department of Labour) for the establishment of a statutory council in a sector or area in which no bargaining council is registered. The difference between a bargaining council and a statutory council lies in the fact that a bargaining council is established by agreement




between unions and employers while a statutory council is established by the state after receiving a request from either unions or employers.

The Commission for Conciliation, Mediation and Arbitration (the CCMA): The CCMA is the best known and most important institution for the resolution of labour disputes established by the LRA. The CCMA deals with certain types of unfair dismissal disputes. These dismissal disputes constitute the bulk of the CCMA’s workload. The CCMA has a director and commissioners who carry out its dispute resolution functions. It is independent of the state and of any political party or other organisation. Its functions are to attempt to resolve, through conciliation, any dispute reefed to tit in terms of the LRA and then to arbitrate any dispute that remains unresolved by these means, if the LRA requires arbitration. Most labour disputes are referred to either a bargaining council (if there is a bargaining council registered for the sector and area in which the dispute arises) or the CCMA (if there is no council) for conciliation. This is where a commissioner tries to get the parties to agree to a settlement of the dispute. If conciliation fails, the LRA prescribes that certain disputes return to the council or the CCMA for arbitration. Here a commissioner or arbitrator hears both parties to the dispute and then makes a final and binding ruling or award. Other types of dispute are referred to the Labour Court if conciliation fails. The CCMA also has other functions. It assists in the establishment of workplace forums, and compiles and publishes statistics concerning its activities. The commission may also:

๏ Advise a party to a dispute about the appropriate dispute-resolution process

๏ Advise a party to a dispute to obtain legal advice

๏ Accredit councils or agencies to perform dispute resolution functions

๏ Oversee or scrutinise any election or ballot or a registered trade union or registered employers’ organisation

๏ Issue guidelines in relation to any matter dealt with in the Act

๏ Publish research

The Labour Court and the Labour Appeal Court: The LRA establishes two courts of law to deal with specifically with labour disputes. The Labour Court is similar to a provincial decision of the High Court. It consists of a Judge President, a deputy Judge President and as many judges as the President may consider necessary. The Court is constituted before a single judge and may sit in as many courts as the available judges allow. The Court has various functions which are stipulated in the Act. But unlike the High Court, the Labour Court’s jurisdiction is limited. It can only hear and decide disputes as provided by the LRA. For some time now drawing the line



between the jurisdiction of the Labour Court (in other words, the matters the Labour Court can or cannot decide) and other courts has become very difficult.

The Labour Appeal Court can hear and rule on all appeals against final judgements or final orders of the Labour court. It may rule on any questions arising from proceedings in the Labour Court.

Strikes and lock-outs: The LRA defines a strike as “the partial or complete concerted refusal to work or the retardation or obstruction of work by persons who are or have been employed by the same employer or by different employers for the purpose of remedying a grievance or resolving a dispute in respect of any matter of mutual interest between employer and employee, and every reference to work in this definition includes overtime work, whether the overtime is compulsory or voluntary.

If a strike or lockout does not comply with the provisions of the LRA, the Labour Court has exclusive jurisdiction to grant an interdict or order to restrain any person from participating in or furthering such action, and also to order the payment of just and equitable remuneration of any loss attributable to the strike or lock-out.

The LRA also makes provision for protest action and includes stipulations regarding replacement labour during strikes, picketing, essential and maintenance services, and lock outs.

Collective agreements: The aim of collective bargaining is to reach an agreement. The LRA provides mechanisms through which the parties can achieve this. Although disputes or industrial action many form part of the process of negotiation, the ultimate goal is to conclude collective agreement. The primary forum for collective bargaining is a bargaining council and the LRA contains a number of important provisions relating to bargaining-council agreements. Other collective agreements included between a trade union and an employer outside a bargaining council are also provided for

There are two types of collective agreements procedural agreements and substantive agreements. Recognition agreements (procedural) regulate how the parties will conduct the relationship. Substantive agreements deal with the content of the relationship and conditions of service.

Agency shop agreements and closed shop agreements: A representative trade union whose members are in a majority in a workplace may conclude with the employer an agency shop agreement requiring the employer to deduct an agreed agency shop fee from the wages of its employees who are not members of the trade union and to who the agreement applies. Alternatively, a representative trade union whose members are a majority in a workplace may




conclude with the employer a closed shop agreement requiring all employees in respect of whom the agreement applies to be members of the trade union.

Workplace forums: Workplace forums are designed to facilitate a shift at the workplace from an adversarial relationship between trade unions and employers to a joint problem solving and participatory relationship on certain issues. These forums are also designed to foster co-operative relations through dialogue, information-sharing, consultation and joint decision making, which is not possible through collective bargaining processes. The focus is on non-wage matters such as restructuring, the introduction of new technologies, changes in work scheduling, physical conditions of work, health and safety, and those issues that can best be resolved at workplace level.

The functions of a workplace forum are to promote the interest of all employees in the workplace, irrespective of whether or not they are union members to enhance efficiency in the workplace. A workplace forum may be established in the workplace of any employer with more than 100 employees. Only representative trade unions may apply to the CCMA for the establishment of a workplace forum. Workplace forums employ a consultative approach and a joint decision making approach.

Unfair dismissals: Section 185 of the LRA provides that every employee has the right not to be dismissed unfairly. This protection applies only in respect of employees (and not, for instance independent contractors). The term “dismissal” is also defined in the LRA and specific provision is made for a special category of dismissals called automatically unfair dismissal. In the case of an automatically unfair dismissal, it is the reason for the dismissal that makes it automatically unfair. If an employee exercises a right conferred by the LRA 9such as the right to freedom of association or the right to participate in a protected strike) and he/she is dismissed, the dismissal relates to unfair discrimination (for example, if the employee is dismissed for reasons relating to his/her age, gender language or political beliefs), the dismissal would be automatically unfair because the employee’s right not to be unfairly discriminated against would be at stake. Other forms of automatically unfair dismissals include the following:

๏ Dismissal when the employee refuses to do the work of another employee who is participating in protected strike actions, unless that work is necessary to prevent actual danger to life, personal safety or health

๏ Dismissal in order to compel the employee to accept a demand in respect of any matter of mutual interest between the employer and employee

๏ Dismissal related to the employee pregnancy



๏ Dismissal as a result of unfair discrimination, whether directly or indirect on any arbitrary ground.

Even if a dismissal is not automatically unfair, it must still comply with certain requirements. A dismissal must be for a valid and fair reason (substantive fairness) and this reason must related either to the employee’s misconduct or incapacity, or to the employer’s operational requirements. But a dismissal must also be done in a fair manner. Schedule 8 of the LRA sets out the procedural steps the employer must take in order to ensure that a dismissal is not only substantively fair, but also procedurally fair. The essence of procedural fairness is that an employee must be given an opportunity to be heard. He/she must have the change to respond to the charges or allegations made by the employer and to say why he/she should not be dismissed. An employee who feels that he/she has been unfairly dismissed may refer an unfair dismissal dispute to either a bargaining council or the CCMA for conciliation. If the dismissal is for a reason relating to the employee’s misconduct or incapacity, the dispute can then be referred to arbitration if conciliation fails. In the case of most dismissal disputes relating to the employers operational requirements (including retrenchment), the dispute must be referred to the Labour Court for adjudication if conciliation has failed.

Communication: Grievances and disciplinary aspects: Communication has a tremendous influence on the quality of labour relations in any organisation, Structures, procedures and policies should be put in place to ensure constructive relations between management and workers. There are various ways of enhancing the quality of communication between the parties in the employment relationship, including one-on-one “chat sessions”, performance appraisals, departmental meetings, safety and health committees, briefing sessions, workplace forums and coaching sessions.

The grievance procedure: In the context of labour relations, a grievance is an employee’s response to a real perceived or alleged breach of the terms of the employment contract. Possible examples include one-sided changes to the employee’s conditions of employment or an employee being insulted by a supervisor. An effective grievance handling procedure has many advantages:

๏ It is a safety valve that will release the tension and dissipate the latent aggression inherent in all businesses

๏ It allows the raising and settlement of a grievance by a worker without fear of retribution or victimisation

๏ It makes for an open an honest relationship between manager and worker.




๏ It allows managers to identify and remove legitimate causes of dissatisfaction or conflict

The disciplinary procedure: Discipline can be described as any action or behaviour on the part of authority (the employer) in a social system that is aimed at stopping member behaviour that threatens to disrupt the functioning of the system. It is therefore a normal and inherent part of any business actions and responsibilities. Discipline should not be aimed at punishment for the transgression of rules, but rather at rectifying unacceptable behaviour. This is called a corrective approach to discipline. The principles underlying the disciplinary procedure are:

๏ The employers right to take disciplinary action against an employee who breaches a rule or standard governing conduct in the workplace

๏ The employee right to a fair procedure

Schedule 8 of the LRA (the Code of Good Practice: Dismissal) contains numerous provisions that are important in the context of workplace discipline. The Code of Good Practice confirms that discipline in the workplace must be corrective. It also provides that discipline must be progressive. Progressive discipline means that dismissal is the last resort (except in the case of serious misconduct). Counselling and warnings (ranging from verbal warning to final written warnings) may be more appropriate. Discipline should be applied consistently by the employer (similar cases should be treated similarly) and disciplinary standards must be communicated to employees. The most common way of communicating disciplinary standards is through the employer’s disciplinary code and procedure. This code and procedure is often handed to an employee at the beginning of his /her employment.

4. The Basic Conditions of Employment Act (No75 of 1997) (the BCEA)

The overall purpose of the Basic conditions of Employment Act (No 75 of 1997) is to advance economic development and social justice in South Africa. One of the objects of the BCEA is to give effect to and regulate the right to fair labour practices conferred by section 23 of the constitution of 1996. Other objectives include establishing and enforcing basic conditions of employment and regulating the variation of basic conditions of employment.

Section 4 of the BCEA sets out the way the minimum standards contained in the BCEA interacts with employment contracts. A minimum BCEA standard will, for instance constitute a term of any employment contract unless the existing term in the contract is more favourable to the employee than the one contained in the BCEA. If the contract provides for more days annual leave than the 21 days annual leave provided for in the BCEA the contract will apply. The BCEA covers a wide range of issues, only a few of these issues will be discussed below.



Working time

Chapter 2 of the BCEA, which regulates working hours, does not apply to senior managerial employees, to employees engaged as sales staff who travels to the premises of customers and who regulate their own hours of work, or to employees who work fewer than 24 hours per month for an employer. As a general rule, working hours must be arranged with due regard for the health and safety of employees and with reference to the Code of Good Practice on the Regulation of Working Time.

Ordinary hours of work are limited to a maximum of 45 hours in any weeks: nine hours if the employee works five days a week or eight hours if the employee works more five days a week. Over time may only be worked if the employee has agreed to work over time. No more than ten hours overtime may be worked in a week. Overtime is expensive: the employer must pay an employee one-and-a half times the employee’s normal wage. As an alternative to over-time pay, the employee may be granted time off.

The BCEA also provides for a meal interval (at least 60 minutes long after five hours of continuous work), which may be reduced to 30 minutes by agreement. An employee must have a daily rest period of at least 12 consecutive hours between ending work and commencing work the following day. Every employee must have a rest period of at least 36 consecutive hours each week. The rest period must include a Sunday, unless otherwise agreed. An employee may agree in writing to rather have a longer rest period of 60 consecutive hours every two weeks.

Night work is defined as work performed between 18:00 and 06:00. Employees must be compensated by the payment of an allowance or by a reduction in working hours. Transport must be available for employees who work at night. Employers must also inform employees who work between 23:00 and 06:00 of the health-and-safety hazards of night work, and, on request, provide employees with a free medical assessment. The limits on ordinary and overtime working hours and the requirements for meal intervals and rest periods do not prevent the performance of emergency work.

The Minister of Labour may exclude or vary the provisions in respect of limits on hours of work and overtime to employees earning more than a certain amount.

Leave

Employees are entitled to 21 consecutive days fully paid annual leave after every twelve months of continuous employment. An employer may not pay an employee instead of granting annual leave. However, an employee whose employment is terminated must be paid out leave pay due for leave that he/she has not taken. An employee is entitled to six weeks paid sick leave for




every 36 months of continuous employment. However, during the first six months an employee is entitled to only one day paid sick leave for every 26 days worked. An employer may require a medical certificate for absence of more than two consecutive days from an employee who is regularly away from work before paying the employee for sick leave. Sick leave may not run concurrently with annual leave or notice to terminate services. A pregnant employee is entitled to four consecutive month’s maternity leave. This leave may begin up to four weeks before the expected date of birth, unless otherwise agreed or if the employee is required to take the leave earlier for medical reasons. An employer may not require an employee to return to work for six weeks after the birth of a child. An employee may, however elect to do so if a medical doctor or midwife certifies that she is fit to return to work. Maternity leave is unpaid leave, although an employee is entitled to claim maternity benefits in terms of the unemployment Insurance Act. It is possible that the employer may pay maternity leave.

An employee who has worked for least four months is entitled to three days paid family responsibility leave per leave cycle. This applies only to employees who work on four or more days in a week. The employee may take this leave in the event of the birth of a child, if the child is sick or if a member of the employee’s immediate family dies. An employer may require reasonable proof of the purpose for which this leave is taken before paying the employee. Unused days do not accrue.

Remuneration, deductions and notice of termination

An employer must pay an employee according to arrangements made between them. An employer may deduct money from an employee pay only if permitted or required to do so by law, collective agreement, court order or arbitration award. A deduction for loss or damage caused by the employee in the course of employment may be made only by agreement and after the employer has established by a fair procedure that the employee was at fault. An employee may agree in writing to an employer deducting a debt specified in the agreement. During the first six months of employment an employment contract may be terminated on one weeks’ notice. The notice period during the remainder of the first year of employment is two weeks while for employees with more than a years’ service, it is four weeks. The notice period for a farm work or domestic worker who has worked for more than four weeks is one month. The notice period may be altered (varied) by a collective agreement between the employer and a union. However, even a collective agreement may not reduce a four week notice period to less than two weeks. Notice must be given in writing. If the recipient cannot understand the notice it must be explained to the y in a language he/she can understand. An employer may pay the employee the remuneration for the notice period instead of giving notice. An employee who occupies accommodation situated on the employer’s premises or supplied by the employer may elect to remain in the accommodation for the duration of the notice period.



Termination of employment by an employer on notice in terms of the BCEA does not prevent the employee from challenging the fairness of the dismissal in terms of the LRA.

For any paid time off to which he/she is entitled that he/she has not taken for example time off for over time or Sunday work

In respect of annul leave entitlement during an incomplete annual leave cycle either on days remuneration in respect of every 17 days on which the employee worked or was entitled to be paid, or remuneration calculated on any other basis, whichever is the most favourable to the employee (this applies only if the employee has been in employment longer than four months).

When an employee’s services are terminated because of the operational requirements of the employer (such as retrenchment) severance pay has to be paid in addition to other payments due to the employee. The minimum amount of severance pay required by the BCEA is the equivalent of one week’s remuneration for each completed year of continuous service. Employees who unreasonably refuse to accept an offer of alternative employment with the same or any other employer forfeit the entitlements to severance pay.

The employer must:

๏ Issue the employee with written particulars of employment when the employee starts employment (these particulars include the employee’s ordinary hours of work and details of the employees wage rate of pay or over time work and leave

๏ Retain these particulars of employment for three years after the end of the contract of employment

๏ Provide an employee with information concerning remuneration, deductions and time worked with regard to his her pay

๏ Keep a record of the time worked by each employee, as well as of each employee’s remuneration. Display at the workplace a statement of employees rights under the Act.

Upon termination of employment an employee is entitled to a certificate of service. Simplified provisions apply to employers who have fewer than five employees and to employers of domestic workers

Prohibition of the employment of children and forced labour




No person may employ a child less than 15 years of age. The Minister of Labour may make regulations prohibiting or placing conditions on the employment of children over fifteen years of age.

Variation of basic conditions of employment

Basic conditions of employment may be varied by bargaining council agreements, collective agreements concluded outside a bargaining council and individual agreements concluded by the employer and the employee. The Minister of Labour may also make determination or issue sectorial determinations. The Minister of Labour may make sectorial determinations establishing basic conditions of employment for employees in unorganised sectors. A number of important determinations have been made, the vest know relating to domestic workers and to farm workers. These sectorial determinations set out minimum wages and other conditions of employment. The BCEA prescribes the procedure that must be followed before a sectorial determination can be made. The Minister must direct a person in the public service to investigate conditions of employment in any sector or area in which it is proposed to make sectorial determination. On completion of the investigation and after considering any representations made by members of the public, the Director General of the Department of Labour must prepare a report that must be submitted to the Employment Conditions commission. Only once the Minister has considered the report and the recommendation made by the commission may a sectorial determination for one or more sectors and areas are made.

5. The Employment Equity Act (No. 55 of 1998) (the EEA)

The main aim of the EEA is to do away with all forms of discrimination in employment in South Africa by promoting equity and non-discrimination in the employment sector. The overall purpose of the Act is to achieve equity in the workplace, chiefly through the following two main elements:

๏ The prohibition of unfair discrimination, which applies to all employers

๏ Affirmative-action measures, which apply only to “designated” employers.

The most important provisions of the Act are as follows:

๏ Employers are required to take steps to end unfair discrimination in their employment policies and practice

๏ Discrimination against employees or job applicants on the grounds of race, gender, sex, pregnancy, marital status, family responsibility, ethnic or social origin, colour, sexual



orientation, age, disability, HIV status, religion, conscience, belief, political opinion, language and birth is prohibited.

๏ Medical and psychometric testing of employees is prohibited unless properly justified

๏ Employers must prepare and implement employment equity plans after conducting a workforce analysis and consulting with unions and employees.

๏ Equity plans must contain specific affirmative-action measures to achieve the equitable representation of people from designated groups in all occupational categories and levels in the workforce

๏ Employers must take measure to reduce disproportionate income differential progressively

๏ Employers must take measures to reduce disproportionate income differentials progressively

๏ Employers must report to the Department of Labour on their implementation of employment equity

๏ The EEA has established a Commission of Employment Equity

๏ The labour inspectors and the Directors General of the department of Labour are responsible for enforcing equity obligations

๏ Any employer who intends to contract with the state must comply with its employment equity obligations

๏ Employees are protected from victimisation for exercising rights conferred by the Act

Scope of application of the EEA

Chapter 2 of the EEA, which deals with unfair discrimination, applies to all employee and employers. Chapters 3 of the EEA which covers affirmative action, applies to “designated employers” and people from “designated groups” only.

A designated employer is:

๏ An employer who employs 50 or more employees




๏ An employer who employs fewer than 50 employees, but with a total annual turnover that is equal to or above the applicable annual turnover of a small business in terms of Schedule 4 of the Act

๏ A municipality

๏ An organ of state, but excluding local spheres of government, the National Defence Force, the National Intelligence Agency and the South African Secret Service

๏ An employer that, in terms of a collective agreement, becomes a designated employer to the extent provided for in the collective agreement.

Designated groups are:

๏ Black people (a general term meaning African people, Coloured people and Indian people)

๏ Women

๏ People with disabilities

Prohibition and elimination of unfair discrimination

In chapter 2 of the EEA, the emphasis is on the prohibition of unfair discrimination. Every employer (not just designated employers) must take steps to promote equal opportunity in the workplace by eliminating unfair discrimination in any employment policy or practice. Section 6 provides that no person may unfairly discriminate (directly or indirectly) against an employee in any employment policy or practice on one or more grounds, including race, gender, sex, pregnancy, marital status, ethnic or social origin, colour, sexual orientation, disability, HIV status, culture or birth. But it is not unfair discrimination to take affirmative action measures in terms of the EEA or to distinguish, exclude or prefer any person on the basis of an inherent requirement of a job. Sexual harassment constitutes a form of unfair discrimination.

Medical testing as part of the employment process is also prohibited, unless it is justifiable in the light of medical facts, employment conditions, fair distribution of employee benefits or the inherent requirements of the job.

Affirmative action

The EEA introduces a duty on designated employers to take affirmative-action measures and to engage in a process of ensuring that, over time progress is made towards employment equity.



The main focus of the EEA is on getting employers to prepare plans to achieve progress towards employment equity and on the assessment of the plans by the Department of Labour. However, the eventual burden of the EEA on employers will, to a large extent, depend on how the Department of Labour applies the EEA and its approach to the employment equity plans submitted by employers.

In the context of affirmative action, a designated employer has the following obligations in terms of section 13 of the EEA:

๏ To consult with its employees

๏ To conduct an analysis

๏ To prepare an employment equity plan

๏ To report to the Director-General on progress made in implementing the employment equity plan the enforcement of the affirmative action provision is part of a process that starts with a labour inspector and might end up in the Labour Court. The labour inspector may, for instance, issue a compliance order to an employer who refuses to give a written undertaking to comply with the Act or an employer who fails to comply with such an undertaking. If an employer fails to comply with the administrative duties in the Act, the Labour Court may impose a hefty fine, ranging from R500 000 for the first offence to R900 000 for four offences. Fines cannot be imposed for not achieving targets, although the Labour Court may make any appropriate order to ensure compliance with the Act if an employer makes no bona fide effort to achieve the targets. However, given South Africa’s history, employers should be extremely sensitive as to how they manage employment relationships, particularly because there are so many possible discrimination traps that employers could fall into.

6. The Skills Development Act (No.97 of 1998) (the SDA)

To improve the low skills base of people in South Africa, the government has promulgated three important pieces of legislation: the Skills Development Act, the Skills Development Levies Act and the National Qualifications Framework Act (NQF). These acts form part of the national skills development strategy a new approach that aims, among other things, to link learning to the demands of the world of work, to develop the skills of existing workers, and to enable employers to become more productive and competitive.

It must be noted, however, that there is a clear link between the different pieces of training legislation and the Employment Equity Act. The principles of equity, access and redress underpin the transformation of the legislation. The links between the various pieces of legislation may be




explained as follows: The NQF Act makes provision for the National Qualifications Framework (NQF), an integrated framework where all knowledge and skills outcomes can be registered as unit standards. The SDA introduces a strategic approach to skills development by creating Sector Educational and Training Authorities (SETA’s), learnerships and skills programs that are to be assessed against standards and qualifications. The Skills Development Levies Act imposes a skills development levy on employers, and the Employment Equity Act requires all employers to eliminate unfair discrimination and promote greater representation of Black people (that is African people, Coloured people and Indian people), women and people with disabilities.

Objectives of the Skills Development Act

Section 2 of the SDA set out the various purposes of the Act:

๏ To develop the skills of the South African workforce

๏ To increase the levels of investment in education and training in the labour market and to improve the return on investment

๏ To use the workplace as an active learning environment, to provide employees with the opportunities to acquire new skills and to provide opportunities for new entrants to the labour market to gain work experience.

๏ To employ persons who find it difficult to be employed

๏ To encourage workers to participate in learning and other training programs

๏ To improve the employment prospects of persons previously disadvantaged by unfair discrimination and to redress those disadvantages through training and education

๏ To ensure the quality of education and training in and for the workplace

๏ To help work-seekers to find work retrenched workers to re-enter the labour market and employers to find qualified employees

๏ To provide and regulate employment service

The following institutions are established by the Act:

๏ The National Skills Authority



๏ The National Skills Fund and the skills development levy grant scheme as stipulated in the Skills Development Levies Act (No 9. Of 1999)

๏ The SETA’s

๏ Labour centres

๏ The Quality Council for Trades and Occupations (QCTO)

๏ Department of Labour provincial offices

๏ National Artisan Moderating Body.

The National Skills Authority

The main functions of the National Skills Authority are as follows (section 5 of the Act):

๏ To advise the Minister of Labour on a national skills development policy and strategy

๏ To liaise with SETA’s the national skills development policy and the national skills development strategy

๏ To report to the Minister on the progress made in the implementation of the national skills development strategy

๏ To conduct investigations on any matter arising out of the application of the SDA and to liaise with the QCTO.

Sector Education and Training Authorities (SETA’s)

The establishment of SETA’s is described in Chapter 3 of the Act. The Minister of Labour may establish a SETA with a constitution for any national economic sector. The Minister of Labour must, however, take the following into account:

๏ The education and training needs of employers and employees

๏ The potential of the proposed sector for coherent occupational structures and career pathing

๏ The scope of any national strategies for economic growth and development




๏ The organisation structures of the trade unions, employer organisations and government in closely related sectors

๏ Any consensus there may be between organised labour, organised employers and relevant government departments as to the definition of any sector, and the financial and organisation ability of the proposed sector to support a SETA

SETA’s have various functions, of which the most important are:

๏ To develop a sector skills plan within the framework of the national skills development strategy

๏ To implement its sector skills plan by establishing learning programs, approving annual training reports, allocating grants in the prescribed manner to employers, education providers, training providers and workers, and monitoring education and training in the sector.

๏ To promote learning programs by identifying workplaces for practical work experience, supporting the development of learning materials, improving the facilitation of learning and assisting in the conclusion of learning programs

๏ To register learning programs

๏ To liaise with the National Skills Authority on the allocation of grants, skills development policy or strategy and a sector skills plan.

Learnerships and apprenticeships

Learnerships are described in Chapter 4 of the Act. A SETA may establish a learnership if it:

๏ Consists of a structured learning component

๏ Includes practical work experience of a specified nature an duration

๏ Leads to a qualification registered by the South African Qualification Authority associated with a trade or occupation

๏ Is registered with the Director General

Any reference to a learnership in this Act includes an apprenticeship and any reference to a learner includes an apprentice.



Learnership agreements are agreements entered into for a specified period between a learner, an employer or a group of employers, and a training provider. The employer has the responsibility to:

๏ Employ the learner for the period specified in the agreement

๏ Provide the learner with specified practical work experienced

๏ Give the learner time to attend the education and training specified in the agreement.

The learner has the responsibility to work for the employer, and to attend the specified education and training. The training provider must provide the education and training specified in the agreement, as well as the learner support specified in the agreement. The Act also makes provisions for the establishment of the Skills Development Planning Unit. Labour centres are to provide employment services for workers, employers and training providers.

Financing skills development

The National Skills Fund must be credited with:

๏ 20% of the skills development levies as stipulated in the Skills Development Levies At

๏ The skills development levies collected and transferred to the Fund

๏ Money appropriated by parliament for the Fund

๏ Donations to the Fund

๏ Money received from any other source.

Artisan Development and Quality Council for Trades and Occupations

The Act makes provision for artisan’s development by establishing a National Artisan Moderating Body. It makes provision for the “listing of trades” and a “national register of artisans”. It further requires that no person may obtain an artisan qualification unless he/she passed a trade test offered by an accredited trade centre.

The Quality Council for Trades and Occupations (QCTO) is established by this Act. The Council consists of 16 members and must, inter alia advise the Minister on all matters related to policy about occupations standards and qualifications. An employer must pay the levy to the commissioner of Inland Revenue Services.




7. The Skills Development Levies Act (No 9 of 1999)

The purpose of the Skills Development Levies Act is to provide for the imposition of a skills development levy. The most important aspects of the Act are outlined below.

According to section 3 of the Act, every employer must pay a skills development levy. The South African Revenue Services is the national collection agency. Every employer must pay levy at a rate of 1% of an employee’s total remuneration. Pensions, superannuation’s or retiring allowances are for example, excluded according to section 2 (5) of the Act

Employers who are liable to pay the levy must apply to the commissioner of the south African Revenue Services to be registered. Employers must indicate the jurisdiction of the SETA within which they belong. They must also register with the relevant SETA. An employer must pay the levy to the Commissioner of Inland Revenue Services.

An employer must pay the levy to the commissioner of Inland Revenue Services not later than seven days after the end of each month. The National skills Fund will receive 20% of the levy. Organisations will be able to claim for financing for up to 80% of the levy.

The following categories of employers are exempted:

๏ Any public service employer in the national or provincial government

๏ Any employer whose remuneration to all of its employees during the following 12 month period will not exceed R500 000 and who is not required to apply for registration in terms of the Fourth Schedule to the Income Tax Act (No 32 of 1944)

๏ Any religious or charitable institution that is exempt from income tax

๏ Any national or provincial public entity that receives 80% or more of its funds from parliament.

The National Qualifications Framework Act (no 67 of 2008) (the NQF)

Introduction to SAQA

After the publication in 1994 of the National Training Strategy Initiative document and the debate on it, the governments White Paper on Education and Training was published in 1995. The south African Qualification Authority Act (No58 of 1995) (SAQA) was passed on 4 October



1995. The objective of SAWA is to provide for the development and implementation of the NQF and to establish the South African Qualification Authority.

The NQF Bill was published in the Government Gazette No 31039 of 9 May 2008 and NQF Act (No67 of 2008) was promulgated on 17 March 2009. The NQF Act mainly provides for the NQF the responsibilities of the Ministers of Education (the Department of Education has been abolished and two new departments have been created: the Department of Higher Education and Training and the Department of Basic Educations) and Labour, the South African Qualifications Authority, quality councils and the real of the SAQA Act of 1995.

The South African National Qualifications Framework (NQF)

The NQF is based on a credit system for achieving learning outcomes. A learning outcome is, in essence an ability developed by the learner that reflects an integration of knowledge and skill that can be transferred to different contexts. Qualifications can be obtained by means of full time study part time study distance education work based learning or a combination of these, together with an assessment of previous learning experience and general experience.

The objectives of the NQF as described in Chapter 2 of the Act are the following:

๏ To create an integrated national framework of learning achievements

๏ To facilitate access to, and mobility and progression within, educating, training and career paths

๏ To accelerate the redress of past certain discrimination in education, training and employment opportunities

๏ To contribute to the full development of learners

๏ To enhance the quality of education and training.

The NQF is a new approach to education and training in South Africa. The NQF consists of a framework with ten levels. Each level is described by a statement of learning achievement know as a level description. This description provides a broad indication of learning achievements or outcomes for a qualification at that level. The first sub framework is the Higher Education band (contemplated in the Higher Education Act). It comprises Levels 5 to 10. The previous Higher Education Band comprised Levels 5 to 8, where level 7 included higher degrees (honours and professional qualifications) and Level 8 referred to masters and doctoral qualifications.




The second sub framework is the General and Further Education and Training band (GFET), which concerns formal schooling and Adult Basic Education (contemplated in the GENFETQA or General and Further Education and Training Quality Assurance Act) this sub framework comprises Levels 2 to 4. Here a large number of providers can provide education and training. Level 4 is equivalent to Grade 12 of schooling.

The third sub framework is the Trade and Occupations band (contemplated in the Skills Development Act). Note that this band is not reflected on Table 11.2

At the time of writing, clarify on the various levels and how they related to the different sub frameworks could not be obtained. According to the framework draft policy (dated 26 July 2008) drawn up by the Department of Labour Quality Assurance for the Quality Council for Trades and Occupations, two types of occupational qualification can be obtained: a National Occupational Award and a National Skills Certificate.

The South African Qualifications Authority

The South African Qualifications Authority continues to exist as a juristic person despite the repeal of the SAQA Act contemplated in Chapter 7. The purposes of the Authority are to:

Oversee the further development and implementation of the NQF

Advance the objectives of the NQF contemplated in chapter 2

The South African Qualifications Authority is accountable to the Minister. It has various functions, such as overseeing the implementation of the NQF, recommending level descriptors to the Minister of Labour recognising a professional body and registering its professional designation.

8. The Occupational Health and Safety Act (No 85 of 1193) (OHSA)

The main purpose of this Act is to protect employees by ensuring a healthy and safe work environment. The origin of the Act can be found in the late 1800’s and early 1900’s when mining operations presented many dangers to workers, and poor working conditions led to various illnesses and sometimes to death.

The Act has a wide application and covers all workers, although there are the following exceptions



๏ A mining area or any works as defined in the Minerals Act (No.50 of 1991), except insofar as the Act provides otherwise

๏ Vessels as defined in the Merchant Shipping Act (No.57 of 1957).

Note that the Minister may grant exemptions from any or all of the provisions of the Act and that labour brokers are not considered to be employers in terms of this Act.

OHSA provides for an Advisory Council for Occupational Health and Safety, with certain functions as stipulated in the Act.

Duties of employers and employees

According to this Act, employers have the following general duties to their employees:

๏ To provide and maintain a working environment that is safe and without risk to the health of employees

๏ To take whatever steps are necessary to eliminate any hazard or potential hazard to the safety or health of employees

๏ To provide any information, instructions, training and supervision as may be necessary to ensure the health and safety of all employees

๏ To take all necessary steps to ensure that the requirements of this Act are complied with

๏ To take any measures that may be necessary in the interest of health and safety

๏ To ensure that the work is performed and that this is done under the general supervision of a trained person

๏ To keep employees informed at all times

Employees have the following general duties at work to:

๏ Take reasonable care for their own health and safety, and also that of others

๏ Co-operate with their employer regarding this Act and its provisions

๏ Carry out lawful orders, and obey health and safety rules and procedures




๏ Report any situation that is unsafe or unhealthy

๏ Report any accident they may have been involved in.

Representatives and committees

Any employers with more than 20 employees must appoint one or more safety representatives after consultation with the works. Health and safety representatives may perform certain functions and must perform other functions.

Health and safety representatives may:

๏ Review the effectiveness of health and safety measures

๏ Identify potential hazards

๏ Examine causes of incidents in collaboration with the employer

๏ Investigate complaints by employees

๏ Make representations to the employer and inspector

๏ Inspect the workplace

๏ Participate in consultations with inspectors

๏ Receive information from inspectors

๏ Attend meetings of the health and safety committee.

Health and Safety representatives must perform the following functions:

๏ Visit the site of an accident at all reasonable times and attend any inspection in loco

๏ Attend any investigation or formal inquiry in terms of this Act

๏ Inspect any document that the employer is required to keep.

๏ Accompany an inspector on any inspection

๏ With the approval of the employer, be accompanied by a technical adviser



๏ Participate in any internal health and safety audit

The employer must provide such facilities, assistance and training as the representative may require. A health-and-safety representative shall not incur any civil liability by reason of the fact that he/she failed to do anything the representative was required to do in terms of this Act.

If two or more health and safety representatives have been designated in a workplace, the employer must establish one or more health and safety committees. The employer must also consult with the committee at each of its meetings to initiate, develop, promote, maintain and review measures to ensure the health and safety of employees at work. Health and safety committees have the following functions:

๏ Making recommendations to the employers or inspector in writing

๏ Discussing any incident that has led to a person’s death or illness and reporting the incident to an inspector in writing.

Inspectors are appointed by the minister and a certificate is issued as proof of their appointment. Their duties include general functions to ensure that the provisions of the Act are complied with – and here they have special powers relating to health and safety – and also functions with regard to incidents at the workplace.

9. The Compensation for Occupational Injuries and Diseases Act (No. 130 of 1993)

In terms of the common law, an employee had no recourse if injured in the course of performing his/her duties. The only way to claim compensation was if intent or negligence on the side of his/her employer could be proved.

The first Act to give some form of protection to the employee was the Workmen’s Compensation Act of 1941, which provided for payment of compensation even if intent or negligence on the side of an employer could not be proved. The basic principle has remained the same: compensation will be paid to an employee (or his/her dependents) if an injury has been caused by an accident “arising out of and in the course of the employee’s employment”. It is not necessary for the employee to prove negligence or fault on the part of the employer to qualify for compensation.

Duties of employers




Employers must register and furnish the Commissioner with details about their businesses. They must keep records of all employees, wages paid and time worked for a period of four years. The record must be sent to the Commissioner each year. The Commissioner will then determine the amount of money; that has to be paid by the employer to the Compensation Fund and the employer must comply within 30 days. The state, parliament, provincial government, exempted local authorities and employers who have obtained an insurance policy for the extent of their potential liability are exempted from giving the required details and paying the determined sum of money.

Procedure to claim compensation

The employee must, as soon as is reasonably possible, notify his/her employer of the accident, as well as his/her intention to instigate a claim. The employer must then notify the Commissioner within seven days. A claim for compensation must be lodged within 12 months of the date of the accident or the date of death.

There are, however, certain requirements that must be met before an employee qualifies for compensation:

๏ An employer-employee relationship must exist, and the employee must be an employee as defined in this Act.

๏ Injury or death must have been caused by an accident.

๏ The accident must have happened in the scope of the employee’s employment. This means that the accident happened in the nature of the employee’s duties and in the course of his/her service.

10.The Unemployment Insurance Act (No.63 of 2001) (UIA)

This Act provides for the payments of benefits for a limited period to people who are ready and willing to work, but are unable to get work for whatever reason. In terms of the UIA, some employees (those who qualify as contributors in terms of section 3 of the UIA) contribute monthly to the Unemployment Insurance Fund (UIF), which is administered by the Department of Labour. Employers also pay in a certain amount for every contributor (employee) that they employ. An employee who is out of work can claim benefits from the Fund. The UIA also provides for sickness benefits, benefits to dependants if an employee – referred to as a contributor – dies, and for maternity and adoption benefits. The UIA should be read in conjunction with the regulations in terms of section 54 of the Act (Government Gazette, No.23283, 28 March 2002) and the Unemployment Insurance Contributions Act (No.4 of 2002).



The Scope of the Act

Most employees are covered by the Act. Section 3 of the UIA excludes the following categories of employees:

๏ Employees employed for fewer than 24 hours a month with a particular employer, and their employers

๏ Employees employed in terms of a learner ship agreement registered in terms of the Skills Development Act (No 97 of 1998), and their employers

๏ Employees in the national and provincial spheres of government

๏ Persons in the Republic on a contract, apprenticeship or learner ship, if the employer is required to repatriate the employee, or if the employee is required to leave the Republic at the end of the contract.

The Act provides for the institution of an Unemployment Insurance Board to assist the Minister of Labour.

Duties of employers

In terms of the Act, employers have certain duties. Every employer has the following obligations:

๏ As soon as a business commences activities as an employer, the business must provide the following information about its employees to the Commissioner, irrespective of the earning s of such employees:

• The street address of the business and of its branches

• The particulars of the authorised person who is required to carry out the duties of the employer in terms of this Act if the employer is not resident in the Republic, or is a body corporate not register in the Republic

๏ The names, identification numbers and monthly remuneration of each of its employees, and the address at which the employee is employed.

The business must inform the Commissioner of any change to any information furnished during the previous month before the seventh day of each month.




The business must pay into the Fund the required amount from the employer and every contributor in his/her employ. (Both the employer and the contributor must pay in an amount equivalent to 1% of the contributor’s earnings, thus a total contribution of 2%. The employee’s contribution can be deducted from his/her wages. Employers must make monthly payments into the Fund within seven days of the end of the month.)

Benefits and allowances

Contributors who lose their jobs are entitled (as are their dependants) to the following benefits:

๏ Unemployment benefits. These are payable for any period of unemployment lasting more than 14 days if the reason for the unemployment is the termination of a contract, dismissal or insolvency. The contributor must be registered as a work seeker with a labour centre established under the Skills Development Act, and must be capable of and available for work.

๏ Illness benefits. These are payable if the contributor is unable to perm work on account of illness and fulfils any prescribed requirements in respect of any specified illness. The period of illness should be 14 days or more

๏ Maternity or adoption benefits. The contributor will be paid the difference between any maternity or adoption benefit received in terms of any other law or any collective agreement or contract of employment, and the maximum benefit payable in terms of this Act.

๏ Dependents benefits. These are payable to a surviving spouse, life partner or dependent child if an application is made within six months after the contributor’s death.

In all instances, application should be made in accordance with the prescribed requirements.

Summary

This chapter provided a brief overview of the activities associated with the human resources function in an organisation. The first part dealt with the recruitment and selection of talent to organisations, the human-resources planning and job-analysis process, and the development of employees. The second part dealt with the importance of motivation in the workplace and considered various theories concerning ways to motivate employees.



Theories & PhilosophiesThe management of organisations is increasingly realising that leadership, not management, is the critical success factor for an organisation. The focus is increasingly on leadership and leadership development rather than on management and management development.

A number of studies have indicated that effective leadership can make a difference in organisational performance (Kotter 1990; Kirkpatrick and Locke 1991; Grobler 1996). But the determinants of leadership success are not as clear cut (Sarros and Woodman 1993:3). For example, which is more significant: leadership traits or leadership as a group activity? What is clear is that successful organisational leadership relies on a combination of traits, skills, attitudes and environmental and intra-organisational conditions. When one or more of these combinations is missing, leadership goes awry.

Despite these observations, Grobler (1996:5) considers that these are related to organisational performance. This view is shared by many authors. Which leadership attributes account for which organisational outcomes, however, is still difficult to determine. In the figure below Sarros and Woodman (1993:4) have tried to answer this question by indicating the relationship of a number of leadership attributes to organisational outcomes. Their findings, which have limitations, are based on a study involving 282 executives undertaken in Australia over a nine month period.

11.The Concept of Leadership

Leadership is a complex phenomenon involving the leader, the followers and the situation. Some leadership researchers have focused on the personality, physical traits or behaviours of the leader; others have studied the relationships between leaders and followers; still other have studied how aspects of the situation affect the ways leaders act. Perhaps the best way to begin to understand the complexities of leadership is to see some of the ways leadership has been defined. A progression of leadership researchers has defined leadership as follows over the years:

๏ The creative and directive force of morale (Munson 1921);

๏ The process by which an agent induces a subordinate to behave in a desire manner (Bennis 1959)

๏ The presence of a particular influence relationship between two or more persons (Hollander and Julian 1969);

๏ Directing and coordinating the work of group members (Fiedler 1967);




๏ An interpersonal relationship in which others comply because they want to, not because they have to (Merton 1969);

๏ Transforming followers, creating visions of the goals that may be attained, and articulating the ways to attain those goals (Bass 1985; Tichy and Devanna 1986);

๏ The process of influencing an organised group towards accomplishing its goals (Roach and Behling 1984)

๏ Actions that focus resources to create desirable opportunities (Campbell 1991)

Leadership remains one of the most researched and controversial topics in management. As seen from the bullet points, many researchers have attempted to "define" leadership over the past almost century but it remains an elusive concept. A popular contemporary definition of leadership describes it as "the process of influencing employees to work willingly toward the achievement of organisational objectives". (Du Toit, Erasmus and Strydom, 2010).

12.Challenges for Leadership in South Africa

What are the challenges that future corporate leaders will have to face in South Africa? Having highlighted the importance of leadership in an organisation, what demands will leaders face in companies in South Africa during the 21st century? Leaders will also have to contribute positively to the establishment and maintenance of the golden triangle. This is an informal but permanent partnership between the state, organised labour and business. These parties share a common destiny because of their interwoven interest.

A further challenge is the development of our export markets as part of internationalisation of the country. As indicated in the World Competitiveness Reports findings, South Africa ranks very poorly in this aspect.

One of the biggest challenges facing leaders however is within the organisation. The media tells us that many corporations in South Africa today are over managed and under-led. The real challenge is to combine strong leadership and strong management and use the one to balance the other.

While management is about coping with complexity, leadership is about coping with change. Major changes are necessary to service and compete effectively in a competitive and ever-changing environment. This can only be achieved through real democratisation of the work place, with a simultaneous flattening of the hierarchy, the devolution of power and authority, the



opening up of existing communication channels and the creation of new ones (Pretorius 1995:12).

This can only be achieved when every individual begins to believe that his or her own ambitions and vision of the future coincide with those of the company. According to Pretorius (1995:13), constant, uninterrupted, enthusiastic and motivating communication is necessary to make this possible, while shared values should serve as the foundation on which constructive relationships, and mutual trust develop and thrive.

The future leader must be caring, show empathy, be willing to serve and recognise human worth. In addition, the future-orientated leader will also have to find and maintain a fine balance between functional achievement and empowerment, between efficiency and broad consultation and between democracy and a flexible adaptable strategy. To succeed in this, leaders should build on the following assumptions:

๏ People are trustworthy and purposeful;

๏ Everyone has a unique contribution to make;

๏ Complex problems should be handled at the lowest possible level.

1. What type of leadership approach should be followed in South Africa?

What type of leadership approach should be followed in South African companies? Grobler (1996:12) states that it is important to choose a leadership approach that will enable South African organisations to reach levels of accomplishment never before dreamed of. However, such levels cannot be achieved without everyone in the organisation working together. What we are talking about is leadership of an organisation and not leadership of an individual, as was the case historically.

According to Seltzer and Bass (1990:694), the desired results can be found in the transformational approaches to leadership. With this approach, leaders inspire their followers; deal individually with subordinates to meet their development needs and encourage new approaches for solving problems. Grobler (1996:12) found that the leader who followed a transformational approach by building a shared responsibility team, continuously developing the skills of individual subordinates and determine and building a common vision, created superior performance. We see that transformational leadership consists of three factors: charismatic leadership, individualised consideration and intellectual stimulation.




From the vast amount of management and leadership literature available, it is clear that the beginning of the 21st Century will be characterised by pressure on individual managers to perform in whatever organisational situations they find themselves. These situations, as we all know, are not static. Many of the old management certainties have been swept away by the diffusion of responsibilities and the compartmentalisation of specialities through efforts such as re-engineering.

Because leadership is the central ingredient to the way progress is made and organisations develop and survive in a changing environment, the next question is what should South Africans do?

Research by Charlton (1992), Spangenberg (1993) and others has found that a worker commitment and productivity crises exists in South Africa and that the average business leader in South Africa is out of touch with his or her people. These problems facing South Africans can be attributed to leaders who have failed to instil a vision, a sense of meaning and trust in their followers.

Leaders in South Africa need to personalise responsibility by creating a context in which routing jobs become meaningful, the human spirit is liberated and people are transformed from a position of working to live to living to work (Charlton 1992; 7).

The question is how? The author believes that the answer lies in the application of Flanagan’s and Thompsons’s (1993) model of managerial leadership. This model, which has been tested with numerous managers and in various settings around the world, encompasses transactional management and transformational leadership and includes a third major component: situational sensitivity. These three macro factors are represented in the basic model below:

The managerial leadership model is an aid to help management diagnose their organisation situation and deploy the appropriate leadership response – that is, the right combination of transformational and transactional leadership required. It is important to note that the precise mix will vary from one organisation to the next and also from one time to another. Working from the basic macro factors of transformation, transaction and the situation, Flanagan and Thompson derived a range of components from these factors:

Transactional Management

Transformational Leadership

Situational Sensitivity



Agrees objectives

Communicates information

Motivates

Bargains

Promotes security

Stabilises

Creates Vision

Communicates meaning

Inspires

Empowers

Takes risks

Stirs

Scans organisation

Reads job

Understands self

To be successful, Grobler (1996:13) states that managers will need to acquire these three macro components underlying capabilities. Once managers have these skills, they must exercise them holistically, and if manager’s actions and behaviour are in harmony with the demands and expectations of the situation, they will be successful. It is important to note that each of the components in the model builds progressively on the other. For example, once a vision has been created, it is important to agree on specific objectives that will achieve the vision.

A further critical aspect is that, after this process has been completed, the vision and objectives must also be communicated to the employee. This will give meaning to their work. Hard facts and information will also be required to set further individual objectives against which to measure performance. We also see that if employees find meaning in what they do, this can inspire them to greater efforts.

This process would be accompanied by the empowerment of employees. Devolution of authority will enable employees to stir things up and be innovative, resulting in employees taking risks by exploring new ways of managing new situations that will provide opportunities to adapt to change. If the activities mentioned are not in tune or harmony with the company’s environment, however, they will not be successful. Such harmony or fit is contingent upon the situation.

Flanagan and Thompson (1993) further identify three variables in the “situation”: the person, the job and the organisation. The expectations of the different groups in the organisation provide guidelines for management. However, the manager will be required to know which priorities require attention and will have to select the most appropriate behaviours. It is thus important to note that each job in each situation will require a blend of transformational and transactional skills and attributes.




The attribute or skill of situational sensitivity is the key factor in the model to provide congruence between expectations and behaviour. If managers lack this key factor of situational sensitivity, no matter what the range of their other skills, they are not likely to be able to identify correctly what is expected of them and will not be able to behave congruently

The blend of transformational and transactional skills must result in behaviour which is congruent, that is, in harmony with the situational demands. This congruent behaviour is the output of the total process, the ultimate outcome being enhanced organisational performance.

2. Managing through Change

South Africa needs managers who can ride the waves of change, who can function as leaders in the process of organisational and environmental adaptation to change. They must be able to read environmental signals and translate such signals into meaningful messages to be dealt with in various ways according to the requirements of the specific work circumstances.

Skills must be developed to scan the environment in anticipation of how, for instance, changed labour resources, changed economic circumstances and changed government policy can combine to create forces that are likely to influence each other, to gather momentum and to shape the structure, culture and future of the organisation. In analysing the leadership challenges faced by South African managers, certain themes become evident (Grobler 1996:14):

๏ Managers must be aware that in the “crucible process” confronting South African they, as leaders, have no option but to change as well. They will have to learn to change from justifying what was done in the past to assessing strengths and weaknesses through a new perspective based on an awareness of the implications of the change that is taking place, and of how to deal with it. Managers will have to learn new skills, new competencies and new management styles.

๏ Managers are key players in the creation and maintenance of the organisation’s culture. Awareness of changes in workers goals, values and expectations and how these need to be integrated to form a new workplace culture is important. Two elements that are closely connected with this are power politics and worker resistance. Strategic changes are influenced by ideological and personal issues. Successful leadership requires an understanding of these dynamics, predicting the impact of change and shaping situations and circumstances to make constructive use of change. Finally, the art of negotiating is indispensable for all managers. An important aspect of negotiating is understanding how issues are interpreted, i.e. the ability to see circumstances through the eyes of other parties. Appreciating the views of others requires awareness of one’s own perspectives – it requires knowing that some of the things managers may need to learn for well beyond “management”



as it is commonly defined and practised. Managers need to develop skills that enable them to make sense and create new meaning out of change.

Finally, the art of negotiating is in dispensable for all managers. An important aspect of negotiation is understanding how issues are interpreted, i.e. the ability to see circumstances through the eyes of other parties. Appreciating the views of other’s requires awareness of one’s own perspectives – it requires knowing that some of the things managers may need to learn go well beyond “management” as it is commonly defined and practised. Managers need to develop skills that enable them to make sense and create new meaning out of change.

3. The difference between management and leadership

Some people think of leadership as a more emotional process than management. Leaders have been characterised by terms such as charismatic and inspiring, but one rarely hears of a charismatic or inspiring manager. Management is rational, a process involved with the head with little heart. Management is associated in many people’s minds with words like efficiency, planning, paperwork, procedures, regulations, control and consistency. Leadership is associated with words like risk taking, dynamic, creativity, change and vision. (Hughes et al 1993:61).

In many ways, the differences between being perceived as a leader or as a manager are a function of the specific responsibilities of a given role and how the person in that role chooses to fulfil those responsibilities. Bennis characterised managers as people who do things right and leaders as people who do the right things. This is just one among many distinctions Bennis makes between leaders and managers. The following are several more (Bennis 1989 in Hughes et al):

๏ Managers administer, leaders innovate

๏ Managers maintain, leaders develop

๏ Managers control, leaders inspire

๏ Managers have a short term view, leaders a long term view

๏ Managers ask how and when, leaders ask what and why

๏ Managers imitate, leaders originate

๏ Managers accept the status quo, leaders challenge it.




The following table illustrates differences between management and leadership:

Category Management Leadership

Change Peacemakers: maintenance work, maintaining the present

Repeats and follows what is desirable and necessary

Administers

Maintains

First degree (cosmetic change)

Pacemakers; further change and create the future

Changes people’s ideas about what is desirable, possible and necessary

Innovates

Develops

Second – degree (fundamental) change

People Depends on systems Depends on people

Attention Does things right Does the right things right

Planning Thinks of today Strategic thinking: forward planning

Thinking Focuses on the present

Focuses on getting things done

Reacts to events

Vision of the future and strategy to attain it

Systematic structure: patterns underlying behaviour

Role Make things happen; implementation

Tailor

Pupil

“You serve me”

Influencing, guidance

Designer (vision, social architecture)

Teacher (more insight into reality; questions assumptions)

Server (attitude of serving others)



Attitude towards goals

Impersonal, even passive

Goals arise out of necessity

External control

Reacts to change

Expectations (you owe me)

Active

Influences and changes the organisation

Internal control

Exercises personal choice and responsibility for change and the future

Aspirations (“I can create something”)

Source: Charlton (1992:33-34)

These differences between leaders and managers reflect fundamentally different personality types. The point is not merely that managerial roles emphasise tasks like administration and control, whereas leadership roles emphasise tasks like innovation and inspiration. Leaders and managers are basically different kinds of people. Some people are leaders by nature. More specifically, leaders and managers differ in their views of means and ends, their sense of identity and the ways they relate to others.

Leaders are interested in determining what the ends are, have a profound sense of separateness and have extremely close relationships with followers. This involves power sharing, empowerment and allowing people to think and take decisions. Empowerment means giving people the authority to carry out their responsibilities, as well as removing factors that hamper personal and organisation development.

Managers are interested in the means to achieve ends, are much more in harmony with and at home in their environment and try to maintain a sense of equity and objectivity in procedures and decisions; as a result, managers tend to have relatively superficial levels of emotional involvement with subordinates. Good managers are therefore not necessarily good leaders, and good leaders are not necessarily good managers. From the point of view of organisation productivity, it is of course desirable that all managers should also be leaders – hence the constant search for people who are both managers and leaders.

1. Authority and Power the Basics of Leadership

There are almost as many theories and models of leadership as there are writers on the subject. However, all the theories contain two important concepts: authority and power.




Authority: Without authority, no manager can manage. Authority thus has to do with obtaining the right to enforce certain actions within certain guidelines, and the right to punish failure.

According to Cronje et al., authority is closely related to leadership. Authority is awarded to a manager by the management of an organisation. Unlike authority, power is not awarded to a manager, but is obtained in various ways. The difference between authority and power is important, because in practice there are many people who have authority (which has been awarded), but not the power (which must be earned) to exercise this authority effectively.

Power: Power is awarded by the subordinates of a leader or manager. To have power, a leader (manager) must therefore have subordinates or followers. Leaders can influence followers and effectively assert their authority because a leader must have some sort of power to be called leaders. Without this a leader is not able to influence followers in such a way that they voluntarily aim their activities at the productive attainment of the goals. Power, i.e. the ability to influence the behaviour of others, has nothing to do with the hierarchical position held by a manager, and it is not obtained through a title or entry on an organisational chart – it must be earned by the leader. For this reason someone with authority and power, i.e. a manager with power, is much better than a manager who only has authority.

French and Raven (in Griffin 1987:421) distinguish between the following types of power, which are generally accepted in management literature:

๏ Legitimate power. This is the authority allocated to a certain post by the organisation. According to this, a manager has the right to require subordinates to carry out their duties and the right to dismiss them if they fail to do so. Legitimate power is thus the same as authority. Even if a manager has legitimate power, this does not mean that he or she is a good leader.

๏ Reward power. This is used to give or withhold rewards. Such rewards included salary increases, bonuses, recognition or interesting tasks. The greater the number of rewards controlled by a manager and the more important these rewards are to subordinates, the greater the manager’s reward power.

๏ Coercive power. This is exercised through fear, which may be psychological or physical.

๏ Referent power. This is also known as personal power and is a somewhat abstract concept. Subordinates follow a leader with referent power simply because they like or respect him or her or identify with him or her. In other words, the leader’s personal traits make him or her attractive to others. Charismatic leaders such as Hitler, Yasser Arafat and even Idi Amin are examples.



๏ Expert power. This type of power is based on knowledge and expertise, and a leader who has this has a certain power over those who have a need for this knowledge or information. The more important the information and the fewer the people who have it, the greater the expert power of the individual who does have it.

A further essential differentiation must be made between position power and personal power. Position power points to formal leadership and is instituted by all organisations from the top to the bottom, while personal power points to informal leadership which is allocated to a leader, because of his or her personal qualities, by subordinates or followers.

Hershey and Blanchard use position power and personal power to explain successful and effective leadership. According to them, any leadership effort will result in subordinate behaviour which may be classified as successful or unsuccessful somewhere on a continuum between the two extremes.

For the leadership effort to be effective, subordinates must perform because they want to, in other words, their performance must tie in with their personal goals and needs, and be profitable to them. The leader therefore uses personal power, even though he or she has position power. On the other hand, a leadership effort may be successful but ineffective if the leader made use of reward or punishment to influence subordinates’ behaviour. The subordinates performed as required, but only because of the leader’s position power.

4. Leadership in Practice

The search for the characteristics or traits of leaders has been on-going for centuries. History's greatest philosophical writings e.g. Plato's Republic and Plutarch's Lives have explored the question "What qualities distinguish an individual as a leader?" Underlying this search was the early recognition of the importance of leadership and the assumption that leadership is rooted in the characteristics that certain individuals possess. This idea that leadership is based on individual attributes is known as the "trait theory of leadership".

The trait theory was explored at length in a number of works in the 19th century. Most notable are the writings of Thomas Carlyle and Francis Galton, whose works have prompted decades of research. In Heroes and Hero Worship (1841), Carlyle identified the talents, skills, and physical characteristics of men who rose to power. In Galton's Hereditary Genius (1869), he examined leadership qualities in the families of powerful men. After showing that the numbers of eminent relatives dropped off when moving from first degree to second degree relatives, Galton concluded that leadership was inherited. In other words, leaders were born, not developed. Both of these notable works lent great initial support for the notion that leadership is rooted in characteristics of the leader. (Clarke 2010)




Clarke tells us that for decades, this trait-based perspective dominated empirical and theoretical work in leadership. Using early research techniques, researchers conducted over a hundred studies proposing a number of characteristics that distinguished leaders: intelligence, dominance, adaptability, persistence, integrity, socio-economic status, and self-confidence.

1. Rise of alternative theories

In the late 1940s and early 1950s, however, a series of qualitative reviews of these studies (e.g., Bird, 1940, Stogdill, 1948; Mann, 1959) prompted researchers to take a drastically different view of the driving forces behind leadership. By existing reviewing literature, Stogdill and Mann found that while some traits were common across a number of studies, the overall evidence suggested leaders in one situation may not necessarily be leaders in other situations. Subsequently, leadership was no longer characterized as an enduring individual trait, but rather as situational approaches assumed that individuals can be effective in certain situations, but not others. This approach dominated much of the leadership theory and research for the next few decades.

2. Re-emergence of trait theory

New methods and measurements were developed after these influential reviews that would ultimately re-establish the trait theory as a viable approach to the study of leadership. This allowed trait theorists to create a comprehensive picture of previous leadership research rather than rely on the qualitative reviews of the past. Equipped with new methods, leadership researchers revealed the following:

Individuals can and do emerge as leaders across a variety of situations and tasks.

Significant relationships exist between leadership and such individual traits as:

๏ intelligence

๏ adjustment

๏ extraversion

๏ conscientiousness

๏ openness to experience

๏ self-efficacy



While the trait theory of leadership has certainly regained popularity, its re-emergence has not been accompanied by a corresponding increase in sophisticated conceptual frameworks.

Considering the criticisms of the trait theory outlined above, several researchers have begun to adopt a different perspective of leader individual differences—the leader attributes pattern approach. In contrast to the traditional approach, the leader attribute pattern approach is based on theorists' arguments that the influence of individual characteristics on outcomes is best understood by considering the person as an integrated totality rather than a summation of individual variables. In other words, the leader attribute pattern approach argues that integrated constellations or combinations of individual differences may explain substantial variance in both leader emergence and leader effectiveness beyond that explained by single attributes, or by additive combinations of multiple attributes.

What makes a person want to follow a leader? People want to be guided by those they respect and who have a clear sense of direction. To gain respect, they must be ethical. A sense of direction is achieved by conveying a strong vision of the future.

When employees respect you as a leader, they do not think about your attributes, rather, they observe what you do so that they can make a judgement as to who you really are. They use this observation to determine if you are an honourable and trusted leader or a self-serving person who misuses authority to look good and get promoted.

The basis of good leadership is honourable character and selfless service to your organization. In your employees' eyes, your leadership is everything you do that effects the organization's objectives and their well-being.

๏ what they are [be] (such as beliefs and character)

๏ what they know (such as job, tasks, and human nature)

๏ what they do (such as implementing, motivating, and providing direction).

5. Leadership Styles and Theories

From Mahatma Gandhi to Nelson Mandela, there are as many leadership styles as there are leaders.

So, whether you manage a team at work, captain a sports team, or lead a major corporation, which approach is best? Consciously, or subconsciously, you have probably used some of the leadership styles in this module at some point. Understanding these styles and their impact can




help you develop your own, personal leadership style – and help you become a more effective leader.

With this in mind, there are many different frameworks that have shaped our current understanding of leadership, and many of these have their place, when they are used appropriately.

1. Leadership theories

Researchers have developed a number of leadership theories over the years. These fall into four main groups:

2. Behavioural theories – What does a good leader do?

A good example is the Blake-Mouton Managerial Grid helps you decide how best to lead, depending on your concern for people versus your concern for production. The model describes five different leadership styles: impoverished, country club, team leader, produce or perish, or middle of the road. The descriptions of these will help you understand your own leadership habits and adapt them to meet your team's needs.

Some leaders are very task-oriented; they simply want to get things done. Others are very people-oriented; they want people to be happy. And others are a combination of the two. If you prefer to lead by setting and enforcing tight schedules, you tend to be more production-oriented (or task-oriented). If you make people your priority and try to accommodate employee needs, then you’re more people-oriented.

Neither preference is right or wrong, just as no one type of leadership style is best for all situations. However, it's useful to understand what your natural leadership tendencies are, so that you can then begin working on developing skills that you may be missing.

The Managerial Grid is based on two behavioural dimensions:

Concern for People – This is the degree to which a leader considers the needs of team members, their interests, and areas of personal development when deciding how best to accomplish a task.

Concern for Production – This is the degree to which a leader emphasizes concrete objectives, organizational efficiency and high productivity when deciding how best to accomplish a task.

Using the axis to plot leadership ‘concerns for production’ versus ‘concerns for people’, Blake and Mouton defined the following five leadership styles:



Country Club Leadership – High People/Low Production: This style of leader concerned about the needs and feelings of members of the team. This leader operates under the assumption that as long as team members are happy and secure then they will work hard. What tends to result is a work environment that is very relaxed and fun but where production suffers due to lack of direction and control.

Produce or Perish Leadership – High Production/Low People: Leaders in this category believe that employees are simply a means to an end. Employee needs are always secondary to the need for efficient and productive workplaces. This type of leader is very autocratic, has strict work rules, policies, and procedures, and views punishment as the most effective means to motivate employees.

Impoverished Leadership – Low Production/Low People: This leader is mostly ineffective. He/she has neither a high regard for creating systems for getting the job done, nor for creating a work environment that is satisfying and motivating. The result is a place of disorganization, dissatisfaction and disharmony.

Middle-of-the-Road Leadership – Medium Production/Medium People: This style seems to be a balance of the two competing concerns. It may at first appear to be an ideal compromise. When you compromise, you necessarily give away a bit of each concern so that neither production nor people needs are fully met. Leaders who use this style settle for average performance and often believe that this is the most anyone can expect.

Team Leadership – High Production/High People: According to the Blake Mouton model, this is the pinnacle of managerial style. These leaders stress production needs and the needs of the people equally highly. The premise here is that employees are involved in understanding organizational purpose and determining production needs. When employees are committed to, and have a stake in the organization’s success, their needs and production needs coincide. This creates a team environment based on trust and respect, which leads to high satisfaction and motivation and, as a result, high production.

Theories of leadership have moved on a certain amount since the Blake Mouton Grid was originally proposed. In particular, the context in which leadership occurs is now seen as an important driver of the leadership style used.

And in many situations, the "Team Leader" as an ideal has moved to the ideal of the "Transformational Leader": Someone who, according to leadership researcher Bernard Bass:




๏ Is a model of integrity and fairness

๏ Sets clear goals.

๏ Has high expectations

๏ Encourages high performance

๏ Provides support and recognition

๏ Stirs people's emotions

๏ Gets people to look beyond self-interest

๏ Inspires people

The model proposes that when both people and production concerns are high, employee engagement and productivity increases accordingly.

While the grid does not entirely address the complexity of “Which leadership style is best?” it certainly provides an excellent starting place to critically analyse your own performance and improve your general leadership skills.

How leaders behave impacts on their effectiveness. Researchers have realized, though, that many of these leadership behaviours are appropriate at different times. So, the best leaders are those who can use many different behavioural styles and use the right style for each situation.

3. Contingency theories – How does the situation influence good leadership?

The realization that there isn't one correct type of leader led to theories that the best leadership style is contingent on, or depends on, the situation. These theories try to predict which leadership style is best in which circumstance.

A popular contingency-based framework is the Hersey-Blanchard Situational Leadership Theory, which links leadership style with the maturity of individual members of the leader's team.

The Hersey-Blanchard Situational Leadership Theory was created by Dr Paul Hersey, a professor and author of "The Situational Leader," and Ken Blanchard, author of the bestselling "The One-Minute Manager," among others.



The theory states that instead of using just one style, successful leaders should change their leadership styles based on the maturity of the people they're leading and the details of the task. Using this theory, leaders should be able to place more or less emphasis on the task, and more or less emphasis on the relationships with the people they're leading, depending on what's needed to get the job done successfully.

According to Hersey and Blanchard, there are four main leadership styles:

Telling (S1) – Leaders tell their people exactly what to do, and how to do it.

Selling (S2) – Leaders still provide information and direction, but there's more communication with followers. Leaders "sell" their message to get the team on board.

Participating (S3) – Leaders focus more on the relationship and less on direction. The leader works with the team, and shares decision-making responsibilities.

Delegating (S4) – Leaders pass most of the responsibility onto the follower or group. The leaders still monitor progress, but they're less involved in decisions.

As you can see, styles S1 and S2 are focused on getting the task done. Styles S3 and S4 are more concerned with developing team members' abilities to work independently.

According to Hersey and Blanchard, knowing when to use each style is largely dependent on the maturity of the person or group you're leading. They break maturity down into four different levels:

๏ M1 – People at this level of maturity are at the bottom level of the scale. They lack the knowledge, skills, or confidence to work on their own, and they often need to be pushed to take the task on.

๏ M2 – At this level, followers might be willing to work on the task, but they still don't have the skills to do it successfully.

๏ M3 – Here, followers are ready and willing to help with the task. They have more skills than the M2 group, but they're still not confident in their abilities.

๏ M4 – These followers are able to work on their own. They have high confidence and strong skills, and they're committed to the task.

The Hersey-Blanchard model maps each leadership style to each maturity level, as shown below.




To use this model, reflect on the maturity of individuals within your team. The table shows which leadership style Hersey and Blanchard consider the most effective for people with that level of maturity.

All teams, and all team members, aren't created equal. Hersey and Blanchard argue that leaders are more effective when they use a leadership style based on the individuals or groups they're leading.

Start by identifying whom you're leading. Are your followers knowledgeable about the task? Are they willing and excited to do the work? Rate them on the M1-M4 maturity scale, and then use the leadership style that's appropriate for that rating.

4. Revised Model of Situational Leadership

The validity of Hersey’s and Blanchard’s basic model has been challenged by Nicholls (1985:60) who claims that the model violates three logical principles – consistency, continuity and conformity.

It is inconsistent in the way it connects concern for task/relationships with ability/willingness. The development level continuum lacks continuity since it requires willingness to appear, disappear and reappear as the development level increases. Finally, it runs counter to conformity in that it does not start with a style of high task and high relationship for a group which is simultaneously unable and unwilling.

Nicholls suggest a corrected model which no longer violates the principles of consistency, continuity and conformity, and which presents a completely new model for situational leadership.

Mullins (1994254 – 255) explains Nicholls situational leadership model as follows:

For groups at low development level, that is both unable and unwilling, the leader acts as a parent who wishes to develop simultaneously the ability and the social skills of a child. As both ability and willingness increase, activity connected with both tasks and relationships can be reduced. This allows progression from “tell”, through “consult” to the role of a developer (bottom left quadrant)

The developer role of leadership continues with a light touch to use “participation” and “delegation” in order to develop further the ability and willingness of the group



However, if willingness develops more quickly than ability, the leader will have the opportunity to act more in the role of a coach who is anxious to improve ability.

If, however, ability develops more quickly than willingness, the leader may have to revert to the role of driver in order to push the group to achieve results up to its potential and to prevent unwillingness causing a shortfall in performance.

To summarise, the model requires a smooth progression of the leader from parent, using a high task and high relationship leadership style; following the usual progression “tell-sell” (or consult) – participate – delegate; to the leader as developer and using a low task and low relationship leadership style. But if ability and willingness do not develop in harmony, the leader may find it appropriate to act more like a coach to develop ability, or more like a driver to overcome unwillingness. In the latest edition of their work, Hersey and Blanchard appear to make reference to the points raise by Nicholls. Some people have difficulty understanding the development of followers from R1 to R2 to R3. How can one go from being insecure to confident and then become insecure again? The important thing to remember is that at the lower levels of readiness, the leader is providing the direction – the what, where, when and how. Therefore, the decisions are leader-directed. At the higher levels of readiness, followers become responsible for task direction, and the decisions are follower directed. This transition from leader directed to self-directed may result in apprehension or insecurity. As followers move from low level of readiness to higher levels, the combinations of task and relationship behaviour appropriate to the situation begin to change.

The situational approach to leadership is most likely to result in effective leadership, as it makes provision for different leadership behaviours in different situations. No single leadership style, specific leadership functions or particular leadership qualities are recommended as being the best under all circumstances. This flexibility of the situational approach makes it particularly useful in the complex environment of South African organisations.

5. Trait theories – What type of person makes a good leader?

Early trait theories promoted the idea that leadership is an innate, instinctive quality that you either have or don't have. Thankfully research is showing what we can do as individuals to develop leadership qualities.

Trait theory does, however, helps identify qualities that are helpful when leading others. Examples include empathy, assertiveness, good decision-making, and charisma. However, none of these traits, nor any combination of them, will guarantee success as a leader

6. Power and influence theories – What is the source of the leader's power?




Power and influence theories of leadership take an entirely different approach. They're based on the different ways in which leaders use power and influence to get things done, and the leadership styles that emerge as a result. Perhaps the most well-known of these theories is French and Raven's Five Forms of Power. This model distinguishes between using your position to exert power, and using your personal attributes to be powerful.

French and Raven identified three types of positional power – legitimate, reward, and coercive – and two sources of personal power – expert and referent (your personal appeal and charm). The model suggests that using personal power is the better alternative and, because Expert Power (the power that comes with being a real expert in the job) is the most legitimate of these that you should actively work on building this. Similarly, leading by example is another highly effective way to establish and sustain a positive influence with your team.

Another valid leadership style that's supported by power and influence theories is Transactional Leadership. This approach assumes that work is done only because it is rewarded, and for no other reason, and it therefore focuses on designing tasks and reward structures. While it may not be the most appealing leadership strategy in terms of building relationships and developing a long-term motivating work environment, it does work, and it's used in most organizations on a daily basis to get things done.

Within all of these theories, frameworks, and approaches to leadership, there's an underlying message that leaders need to have a variety of factors working in their favour. Effective leadership is not simply based on a set of attributes, behaviours, or influences. You must have a wide range of abilities and approaches that you can draw upon.

Having said this, however, there's one leadership style that is appropriate in very many corporate situations – that of Transformational Leadership.

Transformational leaders are exceptionally motivating, and they are trusted. When your team trusts you, and is really "fired up" by the way you lead, you can achieve great things! (www.mindtools.org)

7. Common Leadership Styles

The leadership theories and styles discussed so far fit within formal theoretical frameworks. However, many more terms are used to describe leadership styles:

Autocratic leadership: Is an extreme form of transactional leadership, where leaders have absolute power over their workers or team. Staff and team members have little opportunity to make suggestions, even if these would be in the team's or the organization's best interest.



http://www.mindtools.org

http://www.mindtools.org

Most people tend to resent being treated like this. Therefore, autocratic leadership often leads to high levels of absenteeism and staff turnover. However, for some routine and unskilled jobs, the style can remain effective because the advantages of control may outweigh the disadvantages.

Bureaucratic leadership: Bureaucratic leaders work "by the book." They follow rules rigorously, and ensure that their staff follows procedures precisely. This is a very appropriate style for work involving serious safety risks (such as working with machinery, with toxic substances, or at dangerous heights) or where large sums of money are involved (such as handling cash).

Charismatic leadership: A charismatic leadership style can seem similar to transformational leadership, because these leaders inspire lots of enthusiasm in their teams and are very energetic in driving others forward. However, charismatic leaders can tend to believe more in themselves than in their teams, and this creates a risk that a project, or even an entire organization, might collapse if the leader leaves. In the eyes of the followers, success is directly connected to the presence of the charismatic leader. As such, charismatic leadership carries great responsibility, and it needs a long-term commitment from the leader.

Democratic leadership or participative leadership: Although democratic leaders make the final decisions, they invite other members of the team to contribute to the decision-making process. This not only increases job satisfaction by involving team members, but it also helps to develop people's skills. Team members feel in control of their own destiny, so they're motivated to work hard by more than just a financial reward.

Because participation takes time, this approach can take longer, but often the end result is better. The approach can be most suitable when working as a team is essential, and when quality is more important than speed to market, or productivity.

Laissez-faire leadership: This French phrase means "leave it be," and it's used to describe leaders who leave their team members to work on their own. It can be effective if the leader monitors what's being achieved and communicates this back to the team regularly. Most often, laissez-faire leadership is effective when individual team members are very experienced and skilled self-starters. Unfortunately, this type of leadership can also occur when managers don't apply sufficient control.

Relations-oriented leadership: This is the opposite of task-oriented leadership. With people-oriented leadership, leaders are totally focused on organizing, supporting, and developing the people in their teams. It's a participative style, and it tends to encourage good teamwork and creative collaboration.

In practice, most leaders use both task-oriented and people-oriented styles of leadership.




Task-Oriented leadership: Highly task-oriented leaders focus only on getting the job done, and they can be quite autocratic. They actively define the work and the roles required, put structures in place, plan, organize, and monitor. However, because task-oriented leaders don't tend to think much about the well-being of their teams, this approach can suffer many of the flaws of autocratic leadership, with difficulties in motivating and retaining staff.

Servant leadership: This term, created by Robert Greenleaf in the 1970s, describes a leader who is often not formally recognized as such. When someone, at any level within an organization, leads simply by meeting the needs of the team, he or she is described as a "servant leader."

In many ways, servant leadership is a form of democratic leadership, because the whole team tends to be involved in decision making.

Supporters of the servant leadership model suggest that it's an important way to move ahead in a world where values are increasingly important, and where servant leaders achieve power on the basis of their values and ideals. Others believe that in competitive leadership situations, people who practice servant leadership can find themselves left behind by leaders using other leadership styles.

Transactional leadership: This style of leadership starts with the idea that team members agree to obey their leader totally when they accept a job. The "transaction" is usually the organization paying the team members in return for their effort and compliance. The leader has a right to "punish" team members if their work doesn't meet the pre-determined standard.

Team members can do little to improve their job satisfaction under transactional leadership. The leader could give team members some control of their income/reward by using incentives that encourage even higher standards or greater productivity. Alternatively, a transactional leader could practice "management by exception" – rather than rewarding better work, the leader could take corrective action if the required standards are not met.

Transactional leadership is really a type of management, not a true leadership style, because the focus is on short-term tasks. It has serious limitations for knowledge-based or creative work, however it can be effective in other situations.



Bibliography

1. Du Toit, G.S., Erasmus, B.J. & Strydom, J.W. 2010. Introduction to Business Management. City: Oxford University Press, ISBN 978 0 19 599251 9

2. Carrell et al (1999) Human Resource Management in South Africa, Pearson Education South Africa,

3. Gerber PD, Nel PS & Van Dyk, P.D. (1998). Human Resources Management, International Thomson Publishing (Southern Africa), ISBN 1 86864 067 1

4. Cooper RK & Sawaf A. (1997). Executive EQ, Emotional Intelligence in Leadership and organisations, Berkley Publishing, ISBN 0-399-52404-5

5. Nunes, Paulo (2011) Katz and Kahn Social System Concept http://www.knoow.net/en/sceconent/management/katz_kahn_social_system.htm#vermais accessed April 2012

6. Sawaf, A (2011) The Unconventional Wisdom of Emotional Intelligence http://www.aymansawaf.com/exec-synopsis.php




http://www.knoow.net/en/sceconent/management/katz_kahn_social_system.htm#vermais




http://www.aymansawaf.com/exec-synopsis.php




National QualiÞcation Framework Bachelor of...

Documents

Transcript of National QualiÞcation Framework Bachelor of...