New changes to South Africa’s coronavirus employee relief scheme and annual leave

The Department of Labour has published a new directive clarifying a number of issues around the Covid-19 Temporary Employee / Employer Relief Scheme (TERS).

The TERS applies to employers who are ‘facing distress, on lockdown and unable to pay salaries due to the lockdown. It is one of the key ways that the government is helping distressed workers during the coronavirus pandemic.

One of the biggest amendments in the gazette published on Monday (4 May) relates to annual leave and how it impacts TERS claims.

The gazette states that an employer, who has required an employee to take annual leave during the period of the lockdown in terms of the Basic Conditions of Employment Act, may set off any amount received from the UIF in respect of that employee’s Covid-19 benefit against the amount paid to the employee in respect of annual leave.

This is subject to the proviso that the employee is credited with the proportionate entitlement to paid annual leave in the future.

In line with the current rules around social distancing and to avoid individual applications, the gazette also states that an employer must apply on behalf of their employees.

In addition, to speed up the payment of benefits, the directive urges employers to pay employees first before claiming reimbursement or setting-off the claim through the UIF.

Any company that was a contributor to the UIF before 15 March is allowed to apply for the TERS scheme.

The fund has also emphasised that all businesses with employees, from spaza shops to hair salons who are registered with UIF can apply for this relief.

Even employers of domestic workers should also apply for the relief as domestic workers are included in the UIF.

You can download the full gazette here.

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