||Your attention is drawn to Circulars 0033/2006 and 0005/2007, in which the introduction of the Employee-Initiated Severance Package (EISP) was communicated to employees of the WCED.
||The EISP is applicable to all permanently appointed employees, and excludes persons who are appointed temporarily or on a fixed-term contract. It will allow those employees affected by transformation and restructuring, and who wish to leave the public service, to apply for the EISP, which, if the application is approved, will be regarded as a discharge from service (see Circular 0005/2007). The South African Revenue Service has advised that the tax implications of a "voluntary resignation" are higher than for a "discharge from service". The decision was thus made to regard a service termination with the package as a discharge (without any negative connotation), and not as a resignation, as it holds better tax benefits for the employee.
||It is important to restate the following definitions of the terms "transformation" and "restructuring":
||"Transformation" relates to circumstances in which there is a need to change the nature or condition of an employee's continued employment to give effect to the principles for public administration, as contained in Section 195 of the Constitution, 1996. In practice, such circumstances will typically relate to the following:
- Improvement in the use of resources
- Equitable provision of public services
- Establishment of a representative workforce
||"Restructuring" relates to circumstances where an employee's continued employment is not deemed to be in the best interest of the organisation for the following reasons:
- The re-organisation and/or relocation of functions
- The need to provide for the redeployment of excess employees
||In considering all applications for the EISP, the following basic criteria must be taken into account:
- The impact of the employee's exit on the Department's service capabilities (critical posts, scarce subjects, etc.)
- The employee's competence and suitability for continued employment
- The manner in which the employee's exit will support the transformation and restructuring of the Department
- The particular reasons for the employee's request
- The ability of the Department to finance the cost of the EISP, i.e. refunding the Pension Fund, severance pay, leave pay, etc.
- The impact of the granting of the severance package on the morale of other employees
- Whether the employee occupies a post on the Department's establishment, or whether the employee is held additional to the establishment
||PROCEDURE FOR THE SUBMISSION OF APPLICATIONS
Applications must be submitted as follows:
- Employees must complete the attached application form (Annexure A).
- The completed application form (Annexure A) must be submitted to his or her line manager (level of director or head of institution) for that person's comments and/or recommendations. Line managers must enter their comments and/or recommendations in Section B of Annexure A.
- The line manager must then submit the application to the Personnel Office, which will be responsible for the further processing of all applications.
||Kindly ensure that all employees are informed of the content of this circular.
SIGNED: J.H. HURTER