SA Post Office Strategy on Labour SA Post Office Strategy on Labour BrokingBroking

Presented to the Portfolio Committee on Presented to the Portfolio Committee on CommunicationsCommunications

Date: 21 August 2012Date: 21 August 2012

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AGENDA

Portfolio Committee’s key concerns Strategic and business requirements Various forms of workforce SAPO workforce component Optimal labour model for SAPO SAPO concerns and corrective action Various models researched Criteria to assess models Assessment against criteria Financial implications Progress to date and way forward

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Portfolio Committee key concerns

Number of years employed as casuals Disparate remuneration and benefits Working conditions Career path Training

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Strategic and Business requirements Daily fluctuating volumes exceeding crewed volumes, requiring daily

alignment of resources.

Seasonal volumes and/or workload trends repeating themselves over

monthly, quarterly, etc. in turn requiring alignment over stretched periods.

Flexible and extended hours worked by branches for specific activities

such as pension pay-outs.

Strategic projects which are part of the SA Post Office mandate such as

the address expansion programmes, require once-off large numbers of

staff for a limited period

Retail network roll-outs which require permanent staff in newly rolled-out

branches

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Various forms of workforce Definitions

– Permanent employees: Full time employees – Permanent part timers: Permanent employees working less than 8

hours per day, for example, four hours per day– Flexible labour:

• *Fixed term contractors: Employees with a fixed term contract• Owner drivers: Utilised during high volume times using own

transport for deliveries and collections• ˚Agents: Independent agents contracted from within their

communities primarily to service rural and underdeveloped areas in both Mail and Consumer services

• Casuals: Employed via a labour broker on a temporary basis due to seasonality trends, absenteeism , etc

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*Fixed term contractors are sometimes referred to as S32’s. This has no meaning as it refers to a form number where details of fixed term contractors were recorded on. These employees are included in the full time employee numbers

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SAPO workforce complement

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Optimal labour model for SAPO

Permanent Perm PT Flexible StatusMail processing

50% 20% 30% Completed

Mail delivery

70% 30% In progress

Retail 70% 30% Completed

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The above ratios are based on SAPO’s operational requirements

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SAPO’s concerns & corrective actions

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AREAS OF CONCERN CORRECTIVE ACTIONInability of succession planning

Absence of equal pay and other benefits for equal work

Alleged unfair labour practices by labour broking firms associated with SAPO

Loss of the benefit of training effort

Lack of consistent branding eg corporate clothing

Discipline outside SAPO’s control

Use flexible staff as a pipeline for future recruitment and placement purposes

Equitable pay and benefits for equal work

Termination of labour broker contracts

Pool of trained workers for future employment

Provide appropriate corporate clothing

Discipline within SAPO’s control

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Various models researched

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SOE

Banking

Retailing

There is no single best practice flexible labour model. However, large and dispersed companies adopt flexible labour models suitable to their operational requirements

Capability management programme

Outsourced non-core ops staff to dedicated management company

Seen as successful model in industry

Attempted labour broking but was detrimental to quality

Provides training and development for tellers

Casuals seen as first pool for permanent employment

Casuals drawn primarily at extended hours, once permanent staff leave for home

Provided highly regarded training Casuals seen as first pool for

permanent employment

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Criteria to assess models

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Assessment against criteriaCriteria

Current Outsourcing :(Arms length Outsourcing

to Labour Brokers)

Co-Sourcing: (Strategic Partnership with

Staff Management Company)

Insourcing:(Internal SAPO Contracting Unit)

Strategic Fit

• Untrained/unknown -does not support core business

• Poor fit

• Multi-skilled/ multi-tasked to support future business growth

• Good fit

• Multi-skilled/ multi-tasked to support future business growth

• Good fit

Financial Viability

• Lowest cost + simplestoption in short term

• Highest risk adds costs over long term

• Medium to higher cost depending on revenue share model

• Medium to higher cost as SAPO manages staff in house

Organisational Efficiency

• Weak partnership• Poor training, lack of

controls, etc• Low levels of

efficiency and high risk

• Strong partnership• Bring best practices • Higherlevels of

efficiency

• Direct management of training and deployment

• Highest levels of efficiency

LegislativeCompliance

• Currently compliant • Possibly lowfuture

compliance

• May be compliant to future legislative changes

• High compliance to future legislation

SocialImpact

• Basic job creation• Low levels of social

impact

• Higherlevels of social impact

• Highest levels of social impact.

• Future enterprise development

9

Yes

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Financial implications

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Current cost Future cost

R280m (Actual) R322m

Rationale for additional cost

Equal pay for equal workDecent working conditionsCorporate clothingTrainingPipeline for future employment

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Progress to-date and way forward

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Thank you!

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