Workplace injury/death is an unfortunate and tragic occurrence and can leave an employee and their family in dire straits. Many people within South Africa are not fortunate enough to have decent medical aid and injury cover. In order to assist them, the government instituted Workman’s Compensation and provided funding to those with workplace injuries or death. We will be unpacking some of the key aspects of Workman’s Compensation below.
What is Workman’s Compensation?
Workman’s Compensation also known as COIDA (Compensation for Occupational Injuries and Diseases Act, (130 of 1993) or The COID Act) is a workplace insurance against any injuries, diseases or death of an employee while on company time. It covers both full time and casual employees. It will pay for the medical expenses relating to the injury or in the case of death, offer payment to the family of the deceased.
When do you need to register for Workman’s Compensation?
It is a legal requirement to register for COIDA once you have employed your first employee and run your first payroll.
How do I register for COIDA?
Start by registering as an employer on the Online Submissions website. You need the following information on hand:
- Director’s ID number
- Company tax number
- Company Address
- Company banking details
The most important part of registering a company is you need to register them under the correct nature of business.
There is a government gazette with the classification codes giving you a breakdown of the rates. Alternatively you can use the Classification of Industries W.A.S. 150T(E). This form gives you a breakdown of the description of each classification code so that you are 100% sure under which category you are registering the company.
When registering a company online kicks out an error, you need to contact the labour department at registrationCF@labour.gov.za and attach the below:
- WAS2 Registration of an Employer
- Proof of CIPC Registration Certificate
- SARS Compliance Status Report
- Proof of residential address
- Certified copy of director’s ID
This process can take up to 14 business days to be concluded.
When do I file and pay for Workman’s Compensation?
You are required to file an annual return, known as a Return of Earnings or ROE, typically between April and May each year with the payment being due at the end of June that year. Late filing or payment will lead to a penalty being levied by the Department of Labour.
How much do I need to pay for Workman’s Compensation?
The amount due is highly dependent on the industry you operate in as differing industries have differing risk of injury/death. As an example, companies in the construction industry are significantly more at risk of injury/death than marketing consultants and therefore their fee is adjusted accordingly. This is an important point to note as the industry, denoted by an industry code, that you are registered under will impact your annual fee. The calculation of your fee is therefore based on your industry risk and the salaries paid to both employees and directors. The calculation is also based on both your actual prior year payroll figures and your expected payroll over the coming 12 month period.
How do I claim for Workman’s Compensation in the case of an injury or death?
The Department of Labour have created a dedicated Claims portal, CompEasy that you are required to register your business under in order to facilitate a claim. This is separate to your Workman’s Compensation filing login.
Who is excluded from claiming from the Workman’s Compensation?
The Compensation Fund won’t cover the following employees, according to the Compensation for Occupational Injuries and Diseases Act:
- workers totally or partially disabled for less than 3 days;
- domestic workers;
- anyone receiving military training;
- members of the South African National Defense Force, or the South African Police Service;
- any worker guilty of willful misconduct, unless they are seriously disabled or killed;
- anyone employed outside the RSA for 12 or more continuous months;
- workers working mainly outside the RSA and only temporarily employed in the RSA
Now that you’re more familiar with the ins and outs of Workman’s Compensation, we hope that you’re better prepared for the process. Be sure to stay on top of your filings and payments to ensure you are fully compliant and are eligible for a letter of good standing. These can come in handy when looking for funding, wanting government contracts and also prove your compliance with statutory requirements, always a good thing to have.