Employers urged to declare workers for UIF benefits

As the Unemployment Insurance Fund (UIF) begins to follow the trail of the money that has been disbursed since April 2020 to aid contributors during the lockdown, Employment and Labour Minister, Thulas Nxesi, has appealed to companies to do the right thing and declare workers who still need to be paid.

About R3.2 billion from the first round of Unemployment Insurance Fund claim payments remains in abeyance since April as beneficiary details from employers remain outstanding. The amount is expected to soften the impact of the COVID-19 on 725 791 workers represented by 123 977 employers.

Nxesi has now appealed with companies to declare workers who still need to be paid.

The Minister in a statement on Monday said the Fund has now begun following the trail of the money that has been disbursed since April 2020 to aid its contributors during the lockdown.

“In as much as some companies have re-opened as a result of the risk-adjusted strategy, which has seen the country move to level 3 of the lockdown, we acknowledge that there are still people who would find the injection from the UIF helpful and making a huge difference. There are still a number of companies that are either still closed or in dire straits, and we hope those workers are not left destitute.

“As government, we have committed to ensuring that the worst effects of the pandemic are mitigated through making available a basket of services and other interventions. The UIF has been exemplary in rising to the occasion and helping make the difference,” said the Minister. 

The Minister said May payments are already at R3.2 billion and have benefitted 782 602 workers, represented by 57 260 employers.

However, the department said even in this round, 85 049 workers, who would have benefitted from R356 million in payments, have still not received the money, as the details submitted by employers are missing.

“It is tempting to think of this appeal as counter-intuitive, in the sense that we would be wanting to save money because it is clear that the demands on the UIF, going forward, are going to be massive. But we move from the point that it’s important that workers are not disadvantaged and as such, we appeal for the details so that the Fund can help those who need the money or for whom this may be the only source of funds,” the Minister said.

Since April, the Fund has disbursed more than R21 billion, benefitting 3 609 161 workers, represented by 314 454 employers.

Last week, the Fund appointed auditors to follow the money trail and already, there are indications that some people and companies have allegedly taken advantage of the help being advanced to workers and are seeking to enrich themselves.

“It is alleged that there are companies that have not paid the workers what is due to them. We are aware of some companies allegedly loaning employees the money and that is not legal.

"We are also aware of other companies that are allegedly paying part of the money and not the full amount, as well as companies using the money for something else other than the intended purpose. If this all these allegations are true, we appeal to companies to do the right thing still," said Nxesi.

He has also appealed to companies to ensure that they are compliant with the UI Act, adding that the Fund has made payments even in cases where companies are not fully compliant because it did not want to disadvantage workers.

“There are many cases where companies have not declared workers or have not contributed to employees. We will be raising debt against those companies and they must know that they need to pay back with interest and other penalties owed to the UIF.

"It is in all our interest to do the right thing. Even without being compliant, we have done the right thing and still paid them the COVID-19 relief and they also have to do the right thing,” said Nxesi.