The Need to Register with the Compensation Commission by Karen van den Bergh
There is a requirement for every employer to submit their return of earnings to the Workman's Compensation Fund by the 31st of March of each year. Who must register with the Workman's Compensation Fund and how does one do so? All employers carrying on business in the Republic of South Africa are required to register with the Fund. Employers are defined in the Compensation for Occupational Injuries and Diseases Act 130 of 1993 as:
" Any person, including the state, who employs an employee and includes:
Any person controlling the business of the employer; If the services of an employee are lent or let temporarily made available to some other person by the employer, such employer for such period as the employee works for that employee; A labour broker who against payment provides a person to a client for the rendering of a service or the performance of work and for which service or work such person is paid by the Labour Broker."
An employer is required to register using the prescribed form (Form WA 52) and the employer is required to submit a separate form for each business he or she carries on.
What records are to be kept by the employer?
The Act stipulates that the employer is required to keep a register or other form of record of earnings and particulars of employment. This record is to be kept for a period of four (4) years after the last entry into the record.
The Act goes further to state that this record shall be kept open for inspection by a Health and Safety Representative elected in terms of the Act or for that matter in terms of the Mine and Health Safety Act 29 of 1996 and a shop steward.
When are employers required to submit their return of earnings?
An employer is required to submit their return of earnings no later that the 31st of March each year. Form W.AS 8 is required to be used for this purpose. The return must stipulate the following:
The amount of earnings paid by him or her to its employees during the period from the first day of March of the preceding year up to an including the last day of February of the following year. Any other information required by the Commission. If an employer has commenced business after the last day of February of a particular year, the employer is required to submit to the Commission an estimation of the earning of his employees up to an including last day of February of the following year.
Please note that in the event that the employer carries on business at more than one premises or carries on more than one type of business, the Commission may require the employer to issue separate returns for each place or type of business.
What is an Assessment?
The annual assessment fee is calculated on workers' earnings and an assessment tariff based on the risks associated with the type of work being done. The formula that is used is the following:
Assessment fee = total workers' pay ÷ 100 x assessment tariff.
Who is exempt from being assessed?
The following institutions are not required to be assessed in terms of the Act:
National and provincial spheres of government, including parliament; A local authority who has obtained a certificate of exemptions from the Workmen's Compensation Act; A municipality that has received an exemption; An employer who has, with the approval of the Director General, obtained from a mutual association a policy of insurance for the full extent of his potential liability in terms of the Act for all employees employed by him.
When can the commissioner vary the tariff of assessments?
The commission has the authority to vary the assessment paid by an employer to the fund. For example if in the opinion of the commission, the employers business is designed, equipped, organized or conducted in such a way as to prevent accidents and the number of accidents and the expenditure in connection therewith is to be less than is usually occurring in a comparable business, the Director General of the commission may elect to assess that employer at a lower rate.
It is important to bear in mind that the converse of the above is also true in that, if in the opinion of the commission the prevalence of accidents within a specific workplace is higher than that of a comparable business, the Director General is empowered to assess that employer at a higher rate.
When must the employer pay the assessment and how do you pay?
Applicable employers are required to pay their assessment within 30 days of receipt of their notice of assessment. The employer can however make arrangements with the commissioner to pay their assessment through installments.
There are 3 ways that an employer can pay.
What happens if you fail to pay the assessment?
If the employer fails to pay the assessment tariff the commission may:
Impose a fine on the employer; In addition, in the event that the employee in the employ of an employer meets with an accident and the assessment has not been paid, the commission may impose a fine equal to the cost of the payment of such compensation payable to the employee. In the event that the employer still fails to pay the required fine, the Commission has the power to approach the magistrate court and seek the appropriate relieve against the employer. The magistrate is empowered to impose a fine on the employer and impose a prison sentence not exceeding one year.
Please contact the writer of this article for more information.
Name: Karen van den Bergh
Company: HRTorQue Outsourcing
Contact Details: 031 564 1155