The Government has announced several relief schemes and initiatives in an attempt to support South African businesses through the Lockdown period. We briefly discussed these in our COVID-19 Lockdown – Support For Business post on 30 March. In a nutshell, the following options exist at the time of writing:
Update 21 April: The Department of Employment and Labour has opened a dedicated UIF toll free hotline, running 8am – 10pm Monday to Friday. The number is 0800 030 007.
Update 16 April: The email application is now obsolete. A new online application is now available. Read more here.
With Labour centres across the country being closed during the lockdown, the UIF’s capacity to process individual employee claims is under severe pressure. With this in mind, we’ve been advised that all employers who are able to apply for the COVID-19 TERS benefit, rather than having employees claim UIF, are urged to go the TERS route instead.
This will effectively allow for consolidated claims rather than many thousands of claims from individual employees, which will hopefully reduce strain on the UIF and allow for some measure of effectiveness in paying out benefits.
The TERS benefit (Temporary Employer-Employee Relief Scheme) is to be submitted by the employer via an application process that is conducted via email. This involves signing the MOA, submitting relevant payroll information and setting up a dedicated bank account for these benefits, or clearing an existing bank account for this purpose. The monies are then paid into the employer’s account to be distributed to the employees. These submissions are done via email or fax, and the employer may assist employees in processing these claims. In this case though, payments are made directly to the employees, and not through the company.
For any queries more detailed than this, we still recommend contacting the UIF free hotline on 0800 030 007 or TERS phone line on 012 337 1997.
You can read more on our interpretation of the general rules around UIF and TERS in the following blogs:
- COVID-19 Lockdown – 27 March to 16 April 2020
- COVID-19 UIF Quick Reference Guide
- Support for Business – COVID-19 TERS
Please note that all of the above is intended for informational use only. It merely represents our interpretation of the options based on our own reading and consultation with labour experts. We ourselves are not labour experts and, as such, cannot offer advice for specific businesses’ situations. Additionally, as with everything at the moment, these things appear to change and get updated daily so we would strongly advise that you contact the UIF or TERS hotlines and / or a labour lawyer or other labour practitioner.
The options available for employees were discussed in our first COVID-19 Lockdown Blog, published on 26 March, as well as being outlined in the email we sent out on the same date. To recap:
- Healthy employees may be put on annual leave or have their service ended with code 17 if the time off must be unpaid.
- Employees who are ill with COVID-19 are entitled to 14-day UIF Illness Benefit and should have their service ended with code 10.
- Employees who are ill with anything other than COVID-19 are treated as usual, i.e. they must be put on sick leave, or annual or unpaid if there’s no sick leave left.
- Employers are also always able to grant employees additional paid leave should they wish to do so.
You can find a handy overview of the forms and contact details required for the various UIF claims in our COVID-19 UIF Quick Reference Guide.
- Expansion of the Employment Tax Incentive (ETI);
- The COVID-19 Temporary Employer-Employee Relief Scheme (TERS);
- Deferred tax liabilities for certain businesses on which SARS has published a Disaster Management Tax Relief FAQs document
- Contents of note within this document are:
- An outline of the requirements to be able to claim employee’s tax relief
- An outline of the expansions made to the Employment Tax Incentive (ETI)
- A worked example of how the employees’ 35% tax deferral will work
- Please note that there is also information on provisional tax deferral. We regret to inform you that this is beyond our scope of services and so we are not able to assist with this scheme.
- Contents of note within this document are:
- Various financial support and relief measures for SMMEs, including;
- Debt Relief Finance Scheme; and
- Business Growth and Resilience Facility.