April 2023<\/a><\/strong>, giving a massive boost to domestic worker rights and protections in the country.<\/p>\nBefore the bill, domestic workers were not entitled to benefits such as compensation for work-related injuries or illnesses.<\/p>\n
Through the new Act,\u00a0the Compensation Fund will start accepting claims from domestic workers and their dependents for injuries or deaths resulting from work-related accidents.<\/p>\n
The Act also identifies the \u201cmain employer\u201d of a domestic worker and holds them accountable for any workplace injuries sustained by the employee. Additionally, employers and the domestic worker will be required to contribute to the Unemployment Insurance Fund.<\/p>\n
Any employee who works more than 27 hours per month must be registered with the Unemployment Insurance Fund (UIF), including domestic workers.<\/p>\n
Employers who have domestic workers working these hours must register as a contributor with UIF and register their domestic workers as their employees.<\/p>\n
A total of 2% of the employee\u2019s salary must be paid to UIF each month \u2013 1% has to be paid by the employer, and the other 1% may be deducted from the employee\u2019s wages.<\/p>\n
In addition to this, to cover workers against occupational diseases, injuries and death, employers must register with the Compensation Fund and submit annual returns.<\/strong><\/p>\nWhat you must pay<\/strong><\/p>\nEmployers make contributions to the Compensation Fund. Their employees can claim from the Compensation Fund if they become ill, are injured, disabled or killed while performing their work duties.<\/p>\n
Employers pay an annual contribution to the fund based on an employee’s total earnings for the year.<\/p>\n
Employers are required to submit a statement of earnings paid<\/strong> to all their workers – typically from the beginning of March to the end of February. The latest gazette changes this to 30 June 2023<\/strong> for the 2022 assessment.<\/p>\nFor the 2023 assessment, the relevant period is 28 February 2023 to 31 March 2024.<\/p>\n
The annual assessment fee is calculated on workers\u2019 earnings, and an assessment tariff is based on the risks associated with the type of work being done.<\/p>\n
Earnings include<\/strong> all the remuneration workers receive from the employer, including:<\/p>\n\n- Overtime;<\/li>\n
- Bonuses paid;<\/li>\n
- Commission;<\/li>\n
- The cash value of food and quarters supplied as part of their remuneration package;<\/li>\n
- The cash value of fringe benefits;<\/li>\n
- Travel and other allowances; and<\/li>\n
- Any other remuneration in cash or kind to an employee as part of their contract.<\/li>\n<\/ul>\n
Earnings exclude<\/strong><\/p>\n\n- Reimbursive payments;<\/li>\n
- Non-recurring payments for specific tasks outside normal duties;<\/li>\n
- Intangible fringe benefits;<\/li>\n
- Payments to cover special expenses; and<\/li>\n
- Other non-recurring or occasional payments.<\/li>\n<\/ul>\n
Earnings carry both a minimum and maximum threshold per employee, annually. The Maximum earnings threshold is R529,246<\/strong> (if an employee earns more than this in a year, it is capped at this amount), while the minimum is R1,443 – or R498 for domestic workers<\/strong>.<\/p>\nAny submissions after the deadline will be charged a 10% penalty for late submission, the department said.<\/p>\n
“Employers thus have until 30 June 2023 to submit all their Return of Earnings to avoid a penalty for the late submission of the 2022 ROEs. To be in good standing, you are required to submit the Return of Earnings before the set deadline.”<\/p>\n
It is against the law for failure to submit the ROEs, and penalties will be charged, it said.<\/p>\n
Payment must also be made within 30 days to avoid interest. A Letter of Good Standing will be issued on receipt of the full payment and can be verified online using the unique Certificate Number.<\/p>\n
Who is the employer?<\/strong><\/p>\nUnder the new Act, an employer is anyone, including the state, who employs at least one employee.<\/p>\n
If an employee’s services are “let, lent or temporarily made available” to someone else – that person is considered the employee for that period.<\/p>\n
When it comes to labour brokers – or services where a person is provided to a client for the rendering of a service or performance of work – these brokers or services are considered the employers, not the clients hiring the services.<\/p>\n
Given these definitions, and in the context of domestic workers, whoever pays the domestic worker in question is regarded as the employer for purposes of the fund – for whichever duration – and will be required to comply with the Act.<\/p>\n
Employees include full-time workers, casual\/temporary workers, and all domestic workers.<\/p>\n
The Return of Earnings submissions can be made online at the department’s website. An example of the forms required can be seen in the gazette below.<\/p>\n