Deloitte Human Capital Insights & Rewards
COVID-19 Flash Survey II
July 2020
Preface
The first week of July officially marked the 100th day
since the South African Government announced a
lockdown as a result of the Covid-19 pandemic. Since
the announcement , we have published a Covid-19
Flash survey that sought to provide input on what other
organisations are doing in this pandemic. This is our
second publication, seeking the same and providing
input to other issues that may have developed after our
first publication.
To date, the South African government has announced
the move from level 5 to level 3. The movement has
been alluded to be a careful reopening of the economy
whilst ensuring that the spread of Covid-19 is
minimized and contained. On the upside, the reopening
of the economy has brought economic trade in some
sectors such as the services sector, manufacturing and
others. However, besides the positive economic trade,
we have noticed a downside, this in the increase of
Covid-19 infections.
In June, the Minister of Finance presented to the South
African Members of Parliament, the 2020
Supplementary Budget Speech. In his speech, key
highlights drawn is the increase of unemployment in
the first quarter rising to 30.1%, the economic
contraction by 7.2%, the forecasted inflation to 3% and
the gross tax revenue decreasing by close to 20%
(Actual gross tax revenue compared to forecasted gross
tax revenue for the first two months of the 20/21
financial year). As a result of these effects, the Minister
of Finance has therefore made a revision of gross tax
revenue. The revision moves from R1.443 trillion to
R1.12 trillion, resulting in a R300 billion tax reduction.
Studying the recent patterns of Economics and Finance,
it is inevitable that organisations need to be more
flexible, adapt quickly to the new ways of trade and
operations and keep abreast of the season of change.
Perhaps Charles Darwin would better help navigate
the tides through his saying “It is not the most
intellectual of the species that survives, it is not the
strongest that survives, but the species that
survives is the one that is able to adapt to and
adjust best to the changing environment in which it
finds itself”. As such, people and organisations
through its leaders need to adapt and adjust
quickly for survival.
With much uncertainty looming, survey
publications such as our Flash Surveys help
organisations keep up with changes that are
happening, and by such help organisations adapt
and adjust to changes. In an effort to obtain the
pulse of the market change, gauge the need to
explore uncharted routes as it would relate to
Remuneration, Rewards and Benefits, our Human
Capital team has put together this report that
explores:
• Policy changes;
• The future of office bound working
arrangements;
• Allowance tracking;
• The decrease or increase of allowances as a
result of working from home;
• Changes in remuneration structuring; and
• Incentive scheme pay-out.
We hope that this report will be insightful and will
enable your organisation to navigate the challenges
we currently face. Should you have any queries,
please do not hesitate to reach out to our team.
Tyrone Jansen
Associate Director
Workforce Transformation
Deloitte Consulting (Pty) Ltd
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COVID-19 Flash Survey IITrends and Insights01
26%
16%
13%
11%
8%
5%
5%
5%
3%
2%2% 2%2%
Manufacturing
Other
Agriculture & Forestry
Professional Services
Logistics
Pharmaceutical
Fast Moving Consumer Goods (FMCG)
Retail
Healthcare
Education
Financial Services
Public Sector
Technology, Media & Communications
Participants in the Flash Survey
Distribution of Participants
Detailed Flash Survey Results
1. As a result of Covid-19 have you recently updated your HR policies?
2. Is your organisation considering remote work for previously based office staff on a more permanent basis?
3. If yes, is your organisation considering work-from-home allowances?
71% 29%
Yes No
68% 32%
Yes No
24% 76%
Yes No
4. If yes, what kind of furniture and / equipment can be claimed as an expense?
5. Prior to the lockdown period, did your organisation provide travel allowances / petrol cards for office based staff, in addition to basic remuneration?
67% 33%
Yes No
6. If yes, has the allowance / petrol cards been reviewed or is it currently under review due to lesser travel as a result of remote working?
23% 77%
Yes No
100%
83%
38%
29%
17%
13%
8%
3G Cards
Fibre data allowance
Printers/Scanners
Monetary amount to be used at employee…
Office chairs
Second screens
Other *
* Respondents that indicated “other” elaborated as follows:- Insurance for equipment
Detailed Flash Survey Results
Copyright @ 2020 Deloitte Consulting (Pty) Ltd
7. If you have reduced or no longer providing a travel allowance / petrol card, have you:
8. Has your organisation implemented cost saving strategies for any functional areas or levels in the wake of Covid-19?
3%
4%
10%
10%
10%
63%
Increased another benefit
Increased basic remuneration
Reduced / removed the benefit with no other
change to basic remuneration
Unchanged
Other*
Allowance is already part of a structured Total
Package value
* Respondents that indicated “other” elaborated as follows:- Converted to fully taxable allowance- Introduced reimbursive travel allowance - Reduction in basic pay and car allowance
63% 37%
Yes No
Detailed Flash Survey Results
Copyright @ 2020 Deloitte Consulting (Pty) Ltd
9. If yes, which cost reduction strategies is your organisation implementing?
% of respondents
Exec Level1
SnrMngr2
MiddleMngmt3 Skilled4 General5
LowerSkilled (hourly
rate)
SalesRep
SHORTENED WORK WEEK WITH SALARY DECREASE
5% 4% 5% 5% 5% 10% 4%
SALARY DECREASE FOR SAME AMOUNT OF WORK
14% 13% 12% 13% 12% 8% 10%
ZERO INCREASE 41% 39% 38% 37% 37% 35% 38%
ZERO BONUSES 24% 22% 23% 21% 22% 20% 21%
ZERO PROMOTIONS
11% 12% 10% 11% 10% 12% 13%
RETRENCHMENTS 0% 3% 6% 5% 6% 8% 4%
UNPAID LEAVE 5% 4% 3% 5% 7% 6% 6%
OTHER 0% 3% 3% 3% 1% 1% 4%
1. Executive level2. Senior Manager3. Middle Management4. Specialised / Skilled / Supervisory (non-manager)5. General (Clerical / Supervisory)
* Respondents that indicated “other”, elaborated as follows:• Reduced work hours• Reduction of high annual leave balances• Reduction of benefits
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Detailed Flash Survey Results
10. The chart below indicates the percentage of respondents cost reduction strategies across all levels of staff
5%
11%
38%
22%
11%
5%
5%
3%
0% 5% 10% 15% 20% 25% 30% 35% 40%
Shortened work week with salary decrease
Salary decrease for same amount of work
Zero increases
Zero bonuses
Zero promotions
Retrenchments
Unpaid leave
Other
Detailed Flash Survey Results
11. What % of salary increases are being granted for on-target performance for the following levels of staff for the period April 2020 to March 2021?
CATEGORY OF STAFF
% of respondents
0% 0.1% - 3% 3.1% - 5% 5.1% - 8% Above 8%
EXECUTIVE LEVEL 53% 5% 19% 19% 4%
SENIOR MANAGER 53% 7% 20% 17% 3%
MID MANAGERIAL 50% 7% 21% 20% 2%
SPECIALISED / SKILLED / SUPERVISORY
47% 7% 22% 23% 1%
GENERAL (CLERICAL/ SUPERVISORY)
48% 6% 24% 21% 1%
LOWER SKILLED (HOURLY RATED)
43% 8% 14% 32% 3%
SALES (REPRESENTATIVES)
51% 5% 23% 21% 0%
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49%
6%
21% 22%
2%
0% 0.1% -3% 3.1% - 5% 5.1% - 8% above 8%
12. The chart below indicates overall salary increases across all levels of staff which are being granted for the period April 2020 to March 2021.
13. What increases are being granted for Non-executive Directors for the period April 2020 to March 2021?
68%
4%
21%
7%
0%
0.1% -3%
3.1% - 5%
5.1% - 8%
% of respondents
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Detailed Flash Survey Results
14. Annual bonuses for on target performance are being awarded for the following categories of staff for period April 2020 to March 2021?
49%
50%
47%
47%
43%
43%
48%
51%
50%
53%
53%
57%
57%
52%
Yes No
15. Has your organisation changed the following for commission earners (sales staff)?
3%
13%
13%
71%
Paying minimum commission
Commission models
Commission targets
Unchanged
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Detailed Flash Survey Results
Workforce Transformation Practice
Deloitte’s Workforce Transformation service line is able to assist clients in all
remuneration and benefit related matters, be it the complexity of a merger or
acquisition, market trends or establishing benchmarks and job evaluation.
We also consider the impact of change on employee engagement, attracting critical
talent, administrative requirements, tax optimisation, compliance, change readiness,
and level of effort to implement. We assess and align our reward programs with an
organisation’s financial, risk, and talent management objectives.
Our practice has been advising global companies on remuneration for over 20 years.
We are recognised for providing independent, expert advice, as well as commercial
and pragmatic implementation support.
Our team has experience across various industries, sizes of organisations and
complexities of projects. We provide expertise and deliver on projects to the wider
Africa Consulting Practice of Deloitte.
We have access to a vast Deloitte team, which includes specialists in employment law,
corporate governance,
JOB EVALUATION AND PROFILING
EXECUTIVE COMPENSATION
STRATEGY AND POLICY DEVELOPMENT
REMUNERATION REVIEWS
BENEFIT DESIGN AND PACKAGE STRUCTURING
PAY MODEL DESIGN
RETENTION SCHEMES
LONG AND SHORT TERM INCENTIVES
SALES COMPENSATION
SURVEYS AND BENCHMARKINGregulations, tax advice,
mobility, share plan
drafting, accountants,
lawyers and a dedicated
research team.
Our varied client base
affords us a level of
market exposure that
ensures that our
knowledge and
experience are
continually refreshed, as
stakeholder views
develop across
industries and sectors.
Copyright @ 2020 Deloitte Consulting (Pty) Ltd
Why
Deloitte Consulting 2020 13
Tyrone JansenAssociate DirectorWorkforce [email protected]
+27118066218
Elana Hattingh Senior Manager Workforce [email protected]
+27 (0) 11 806 6092
Lesley ColemanManagerWorkforce [email protected]
+27 (0) 11 517 4145
Musa MasingiSenior ConsultantWorkforce [email protected]
+27 (0) 11 209 8803
13
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