Note: This report is Truworths specific as Office is dealt with in the Office Operational Report. All references in this report are therefore to ‘Truworths' rather than to ‘the Group'.
Significant enhancements have been made to human resources practices to improve Truworths' ability to attract and retain employees, and enhance employee engagement and satisfaction levels.
The remuneration packages of full-time employees in specialised roles were converted to total guaranteed remuneration packages (TGP) to allow employees greater freedom of choice in determining benefit contributions. This has ensured that remuneration remains highly competitive in the marketplace.
Additional benefits were introduced for longer-serving flexi-time employees to improve retention and align these employees to their permanent counterparts, ensuring equality in line with the recent labour law amendments. Further enhancements were made to the flexible working hours policy and leave policies.
These widespread changes are aimed at creating a great environment in which to work and have been well received by employees.
A voluntary employee satisfaction survey was conducted across the business and the results analysed by two independent specialist firms, the results of which survey support the view that employees enjoy working at Truworths. The level of employee participation was high relative to the South African benchmark and the survey indicated that 94% of employees are proud to work for Truworths. The summary comments of the analyses are outlined below:
“On the basis of our analysis and our experience in South Africa and the retail sector, your results are generally good. No questions are below the norm, the majority are above and a few in line with what we would expect to see. There are no red flag warning signs in your data.”
“On the contrary, there are some real strengths; in particular there seems to be a strong culture of teamwork and co-operation where employees can openly share ideas with managers, feel rewarded for what they do and believe they deliver a good customer experience. Additionally, there are high levels of confidence in the executive team and a very strong sense of pride in Truworths.”
|Truworths human capital at a glance||2016||2015|
|Total employees||12 037||11 374|
|Full-time employees||5 364||4 447|
|Flexi-time employees||6 673||6 927|
|Permanent employee turnover||(%)||16||13|
|Employee absenteeism (days)||(%)||1.7||1.6|
|Skills development expenditure||(Rm)||107||103|
|Skills development spend per employee trained||(R'000)||10.0||9.7|
|Total employees trained||10 682||10 592|
|Black employees as a % of employees trained||(%)||94||94|
Truworths' business philosophy and values underpin the human capital management strategy and define the way in which management interacts with employees. These values are incorporated into everyday working life at Truworths, from recruitment to training and development, employee relations and recognition programmes. In performance development discussions management not only assesses performance against goals, but also monitors how employees are aligned with Truworths' values.
The Employment Equity Plan 2014 – 2019 guides the Truworths strategy to transform the South African employee base to reflect the demographics of South Africa and ensure that the workplace is free of discrimination.
As an equal opportunity employer Truworths focuses on investing in talent and recognising excellence, with employees being encouraged to realise their potential regardless of race or gender.
Truworths met its annual Employment Equity Plan targets for 2016 and continued to make steady improvement, although it remains a challenge to recruit black talent at senior management levels. The focus has therefore been on developing internal talent to demonstrate commitment to sustainable transformation.
Gender representation shows 72% of employees are female and this is generally evident across all levels up to senior management.
Talent and skills development
Truworths continued to demonstrate its commitment to developing talent linked to productivity and to the succession requirements of the business. The major focus remains on areas of scarce skills, including merchant specialist skills and retail managers. This has enabled Truworths to maximise opportunities in the skills development element of the generic BBBEE scorecard and achieve 18.5 out of a possible 25 points.
Over R107 million (2015: R103 million) was invested in developing internal talent and creating opportunities for unemployed learners. In the reporting period 92% of the total employees and 94% of black employees were trained, in line with the 2015 reporting period.
Training and skills development programmes are mainly developed in-house, enabling us to provide content specific to our needs, ensuring cost efficiencies and protecting intellectual capital.
Through the collaboration with the Wholesale and Retail Sector Education and Training Authority, Truworths continues to invest in learnership programmes, particularly for entry-level positions. Over 1 300 (2015: 1 000) people, including 50 people with disabilities, were registered on accredited learning programmes in the reporting period, with 438 learners completing their qualifications in the period.
The merchant training programme continues to be regarded as the most comprehensive and aspirational programme in the industry. This enables Truworths to attract the best candidates for the programme and to build a strong pipeline of talent for the merchandise division in an environment where it continues to be a challenge to find skills and experience.
Operational training has focused on preparation for the implementation of the new affordability assessment regulations in terms of the National Credit Act which have had wide-reaching implications for the business.
The achievement of Truworths, team and individual performance remains central to driving remuneration strategies. The changes outlined in this report are aimed at ensuring that Truworths is able to attract, motivate and retain high-performing employees.
In addition to specialised full-time employees converting to TGP, as outlined earlier, flexi-time employees in South Africa were converted from weekly to monthly paid employees with a benefit allowance to ensure equity with their full-time counterparts.
A new job evaluation system was introduced to ensure consistent and equitable reward principles are followed that take into account the complexity and skills required for a position, the employee contribution to the business and individual performance levels relative to the market.
Truworths has had a long-standing relationship agreement with the South African Commercial, Catering and Allied Workers Union (SACCAWU) and annually negotiates wages and substantive conditions for the approximately 550 employees in South Africa who form part of the bargaining unit.
All employees are aware of their rights of freedom of association and right to belong to a union of their choice. However, union membership across Truworths remains relatively low at 7%, with membership in South Africa being 7% (2015: 7%). No time was lost to industrial action during the reporting period.
The remuneration of executive and non-executive directors is covered in the Remuneration Committee Report.