COVID-19 SAIPA Updates

COVID-19 Temporary Employee/Employee Relief Scheme

30 March 2020

COVID-19 Temporary Employee/Employee Relief Scheme

In view of the Presidents declaration of the National Disaster on 15 March 2020 in respect of the current COVID-19 pandemic, the Minister of Employment and Labour has issued a Directive called the COVID-19 Temporary Employee / Employer Relief Scheme (C19 TERS). C19 TERS is a special benefit created under the Unemployment Insurance Fund to cater for situations where it will not be economically possible to pay employees as a consequence of the lockdown.

The purpose of this benefit is accordingly to make provision for:

  • Payment of benefits to the Contributors who have lost income due to COVID-19 pandemic;
  • Minimise economic impact of loss of employment because of the COVID-19 pandemic;
  • Avoid contact and contain the spread of COVID-19 during the process of application for benefit;
  • Establish the Temporary Employee/Employer Relief Scheme and set out the application process for benefits of the COVID-19 pandemic and to alleviate economic impact of COVID-19; and
  • online applications for benefits in order to avoid contact during the national disaster period.

The benefit will apply to employees who have lost income or have been temporarily laid-off due to the COVID-19 pandemic but will not apply to employees being paid during the pandemic.

Qualifying Criteria
In order for a company to qualify for the temporary financial relief scheme, it must satisfy the following requirements:

  • The company must be registered with the UIF;
  • The company must comply with the application procedure for the financial relief scheme; and
  • The company’s closure must be directly linked to the COVID-19 pandemic.

Terms of C19 TERS

  • Should an employer as a direct result of COVID-19 close its operations for a period of three months or less and suffer financial distress as a consequence, the employer shall qualify for this benefit;
  • The benefit is not linked to the UIF’s benefits and the rules applicable to the accumulation of benefits will not be applicable to the benefit;
  • The benefit shall only pay the cost of salary for the employees during the temporary closure of the business subject to the maximum benefit of R17 712.00 per month per employee.
  • The employee will be paid in terms of the income replacement rate sliding scale as contained the Unemployment Insurance Act 63 of 2001; and
  • Qualifying employees will receive a benefit calculated in terms of sections 12 and 13 of the Unemployment Insurance Act, provided that an employee shall receive a benefit of no less than sector specific minimum wage.

Illness Benefit

  • Employees who have been quarantines for 14 days due to COVID-19 shall qualify for illness benefit.
  • Confirmation from both the employer and the employee must be submitted together with the application as a proof that the employee was in an agreed pre- cautionary self -quarantine for 14 days.
  • Should an employee be quarantined for more than 14 days, a medical certificate from a medical practitioner must be submitted together with continuation form for payment.

Application Procedure

  • Employers shall apply by reporting their closure to the email address following which an automatic response will outline the application process.
  • The employer shall be required to furnish the Unemployment Insurance Fund with the following completed documents:
    • Letter of authority from the company;
    • Signed Memorandum of Agreement (MOA) from the employer or Bargaining Council with the UIF;