Member Article

On 10 August 2021, the South African Minister of Employment and Labour gazetted Regulations which established a temporary financial relief scheme for workers who have lost income due to the partial or full closure of workplaces destroyed, damaged, looted or otherwise affected by the recent unrest. 

The scheme is a welcome intervention in circumstances where workers are unable to work due to the looting or riots and are not entitled to remuneration. Similarly to hard lockdown where non-essential workers are prohibited from tendering their services, there is no obligation on the employer to pay workers who are unable to tender their services and the employer is unable to accept their services due to supervening possibility of performance, ie, due to the unrest. 

Qualifying employers who have been impacted by the recent unrest are encouraged to apply on behalf of their employees. The scheme will be reviewed every two weeks.

The temporary financial relief is de-linked from the normal unemployment insurance benefits. As a result, the normal rule, namely: for every four days worked, the employee accumulates a one-day credit, does not apply. 

The minister or the delegated authority may, if financial considerations dictate, determine a flat rate for the financial relief. However, qualifying employees will ordinarily be paid on the following scale: 

• Income replacement is calculated at the rate of a sliding scale (38%-60%) based on the employee’s remuneration;
• The remuneration to be taken into account in calculating the relief is capped at a maximum amount of ZAR17 712 per month;
• If the income replacement falls below ZAR3 500 per month, the worker must be paid a replacement income equal to that amount.
  
  

An employee may only receive temporary financial relief if the total of the relief payment, together with any additional payment towards relief or salary in any period, is not more than the remuneration that the employee would ordinarily have received for working during that period. 

The payment of the temporary financial relief to a worker may only be done by way of a direct payment into the worker’s bank account, unless the commissioner permits payment directly to the employer, subject to any specified conditions.

Application process

An employer who has had to close its business due to the unrest must apply for temporary financial relief for, and on behalf of, its affected employees. To do so, the employer must satisfy the following requirements:

• It must be registered with the UIF; 
• Its closure must be directly linked to the destruction, damage or looting of its workplace;
• It must confirm, in writing or electronically, that it accepts the terms of the scheme;
• It must provide details of the destruction or damage to, or the looting of, its workplace and submit documentary proof of a report to the South African Police Services and proof that a case has been opened with a case number; and
• If insured, the employer should also submit proof of submission and acknowledgement of receipt of the insurance claim.
  
  

The employer must apply by reporting the closure of the workplace as a result of the unrest in accordance with the UIF’s application procedure.

Lauren Salt
Employment Executive
[email protected]
+27 84 509 6494

Jessie Moore
Employment Candidate Legal Practitioner
[email protected]
+27 71 125 6135