Employers are not applying for UIF benefits

BUSINESS NEWS - There are currently 220 000 workers who are eligible to claim for salary benefits who could miss out on payments because their employers have not applied for relief.

These workers should be able to access the Unemployment Insurance Fund (UIF) Covid-19 Temporary Employer/Employee Relief Scheme (Ters), but the companies they work for are not passing on payments to them.

Minister of Labour Thulas Nxesi said some employers “had not even dared” to assist their employees in claiming for benefits. The UIF Ters benefit allows employers who are not able to pay employees because of the lockdown to claim for partial payments of their salaries.

Read: Wider relief for companies struggling to pay workers

Nxesi was speaking at a briefing by economic cluster ministers on Tuesday providing updates on the initiatives in place to assist businesses and employees in various sectors.

“We are endeavouring now to contact those individuals … we continue to appeal to them to help us,” said Nxesi.

Applications so far
The UIF, which has 1.8 million registered employers representing eight million workers, has to date received 103 000 applications from employers seeking to claim benefits for 1.75 million employees.

At this stage, the UIF has been able to process 59 000 of these applications for 862 000 workers. Meanwhile, 10 000 applications could not be processed because of errors, including incorrect banking details. The fund has notified these companies to resubmit their applications.

Read: Incomplete applications hold up UIF relief

The total amount of relief that has been paid out by the fund since the start of April is R3.3 billion.

Nxesi emphasised that the Covid-19 Ters benefit would not pay full salaries but a portion of what an employee would normally receive.

Employees are entitled to between 38% and 60% of their salaries, with the maximum salary used to calculate what an employee is due capped at R17 712 per month, 38% of which is R6 730. The minimum payout is R3 500.

Acknowledgement of debt
Employers who have registered to pay UIF are responsible for applying for Covid-19 relief benefits on behalf of their employees.

On businesses that are not complying with UIF requirements and have been making deductions from employee salaries but have not been paying that money to the fund, Nxesi said these companies will have to make arrangements to register. He explained that they will be required to acknowledge the debt they owe and pay the fund once their operations have been able to recover.

“We should not punish the workers because of irresponsible employers,” said Nxesi.

Since the scheme opened employers have complained about its slow administration. The minister’s update states that the UIF’s call centre has increased its capacity from 75 agents to 400 in order to meet the high volume of inquiries from the public, and that more agents will be added.

Read: Ters relief directives cause confusion

Article: Caxton publication, Moneyweb