Somewhat quietly, amid all the other dramatic goings-on in 2022, a notice amendment to the Compensation for Occupation Injuries and Diseases Act (COIDA) was introduced into law. This is a result of the process in which the Compensation Fund Commissioner sought to provide a regulated system of "no-fault" compensation for injury or illness as a result of an individual's occupation and loss-of-income relief to an individual or their family, as well as claims for 'reasonable medical expenses'.
Under the Act, it is deemed a criminal offence for anyone who has not registered under COIDA. This includes any individual or company directly employing staff, including domestic workers, gardeners, caregivers and/or drivers.
This is not to be ignored, especially as The Department of Labour recently employed additional inspectors who will be visiting homes, estates included, to check on employers’ registration status. If you are not registered, and it is proven that you do employ staff, you are subject to a penalty or jail term.
The value of COIDA
COIDA is largely considered a good piece of legislation because it addresses the historically unequal position that workers like domestic staff and gardeners found themselves in when they were injured or disabled, contracted a disease or, worse case, died while undertaking their duties at work. In the past, such workers had no recourse if an employer denied them any form of compensation as a result of such incidents, especially casual workers.
The compensation provided by the Act provides for any worker who is employed for longer than 24 hours a month. COID will pay, on average, up to three months of their salary, up to a maximum claim of R529 264 per year. At between two and three percent of the employee’s salary, it is considered affordable.
The only problem is that it can take up to a year for a claim to be validated as it needs to go through a verification process, including a post-mortem report should it be that the employee dies as a result of injuries sustained while working. This potential one-year waiting period may be a serious problem for families who are unable to subsidise the income lost while the victim recovers or dies. There is also the additional worry of how to pay for medical costs, particularly those that apply to hospital admittance.
How to register
Registration is through The Department of Labour at first glance, it appears somewhat inclined to businesses rather than domestic employers. However, the process requires the following:
- Completion of a CF-1E form;
- A copy of the employer's ID passport or work permit;
- Proof of employer's residential address;
- A copy of the employee's ID, passport or work permit;
- A copy of the employment contract.
All the documents need to be emailed to RegistrationCF@labour.gov.za or CFCallcentre@labour.gov.za.
After registration, employers are required to submit an annual Return of Earnings on behalf of their domestic workers, which indicates their income and other benefits during the course of the year. The timeframe to submit this information is between 01 April and 31 May of each year.
The Compensation Fund uses the Statement of Earnings to calculate the applicable annual fee, which is based on the risk profile of the employee's job and their earnings. The employer is then emailed an invoice that needs to be settled within 30 days, or interest penalties will apply.
Alternative registration routes
If the thought of going through this process is daunting, there are companies that will undertake this registration on your behalf but for a fee, which in some cases seems exorbitant.
Another option is to consider taking out a gap cover policy, such as that offered by short-term insurer Santam’s SHA (Accident and Health Division). It will undertake the registration on a client's behalf if such a client avails of its shortfall cover policy, the Employee Injury Assist. This policy will pay out a certain amount within 48 hours to the injured or family of the affected individual, even if such an event occurs outside the workplace. It also expands on the benefits of COID because it bridges the potential one-year COID claim payout time gap. Other benefits include facilitating an SHA-initiated 24-hour, seven-days-a-week ambulance request, as well as pre-accredited hospital admittance accompanied by COID forms, and SHA undertakes to monitor COID claims until the end of the claim process on behalf of its policyholders.
This is the type of initiative that lessens the concern around compliance with the law. No doubt, there are millions of household employers that are already in contravention, given the COIDA amendment is now some two years in force. In terms of the Labour Guide, a Labour Inspector who carries credentials is authorised to enter your premises without warrant or prior notice, at any reasonable time, to monitor and enforce compliance with the Act. Warnings are that Labour Inspectors have wide powers, and it is recommended by legal experts that one does not attempt to circumvent the carrying out of their duties.
Writer: Kerry Dimmer