The Department of Employment and Labour (hereinafter referred to as “the Department”) has published a Directive (“hereinafter referred to as “the leave Directive”) on COVID-19 and implications on the leave provisions as set out in the Basic Conditions of Employment Act 75 of 1997 (hereinafter referred to as “the BCEA”) as well as a new Government Gazette No. 43161 titled COVID -19 TEMPORARY EMPLOYEE / EMPLOYER RELIEF SCHEME of 2020 (hereinafter referred to as “the COVID-19 TERS Gazette”).
Can Employers force Employees to utilize annual leave credits during COVID-19 lockdown?
As a term and condition of their employment contract, Employees are entitled to certain leave provisions as set out in the BCEA. The leave Directive from the Department is quite clear in clarifying to the public that the BCEA recognizes certain forms of leave inclusive but not limited to leave benefits such as annual leave, sick leave and family responsibility leave, which may, depending on the circumstances, be applicable to the Employee’s absence from their place of Employment as a result of the COVID-19 lockdown.
The leave Directive further clarified that during the COVID-19 nationwide lockdown period, an Employee may be requested by his or her Employer to utilize their annual leave credits and further that the BCEA lawfully allows Employers to determine the time that Employees can take their annual leave. For example, many Employers request that annual leave be taken during the December/January holiday period and Employees by virtue of their employment contract with the Employer which could stipulate such an agreement have agreed to same. Accordingly, the Department has made it clear that during the lockdown period the BCEA certainly allows for Employers to request that Employees utilize annual leave credits as they would have done during the December/Holiday period or any other agreed period between the Employer and Employee stemming from the terms and conditions of the contract of employment and the provisions of the BCEA. The leave Directive can be read online on their official website at http://www.labour.gov.za/directive-on-covid-19-implications-on-bcea-leave-provision
What is the Temporary Employer and Employee Relief Scheme and the claim process?
The Department, in addition to the COVID-19 TERS Gazette, published a further media statement titled “UIF to process COVID-19 TERS benefit to assist Employers and workers during Coronavirus (COVID 19) lockdown”.
The media statement most notably sets out the following information as it relates to COVID-19 TERS applications:
“To mitigate the impact of the 21-day national lockdown on workers, business and the economy, the UIF will be electronically processing applications for the Covid-19 TERS Benefit. Caring and responsible employers that are unable to pay the full salaries of the workers they send home for their health and safety due to the lockdown are encouraged to apply for the Covid-19 TERS Benefit from the UIF by sending an email to [email protected] from midnight tonight when the lockdown starts. Upon sending the email, applicants will receive an automated reply which outlines all the steps and details, including the requirements to claim benefits. During the lockdown period, manual claims will not be accepted to reduce contact between people to curtail the spread of the pandemic. The Covid-19 TERS Benefit is de-linked from the other UIF Benefits and other processes, however applications are subjected to normal verification and validation processes of the Fund”.
The statement can be read on the Department’s website at http://www.labour.gov.za/uif-to-process-covid-19-ters-benefit-to-assist-employers-and-workers-during-coronavirus-(covid-19)-lockdown
The COVID-19 TERS Gazette
Thembelani Waltermade Nxesi, the Minister of Employment and Labour has issued the COVID-19 TERS Gazette which purposes are as follows:
To make provision for:
- Payment of benefits to the Contributors who have lost income due to COVID-19 pandemic;
- Minimize 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
The COVID-19 TERS Gazette states that should an Employer as a direct result of the COVID-19 pandemic close its operations for a 3 (three) month or lesser period and suffer financial distress, the Employer shall qualify for a COVID-19 Temporary Relief Benefit and the benefit shall be de- linked from the Unemployment Insurance Fund’s normal benefits. The benefits will only pay for the cost of salary for the Employees during the temporary closure of the business operations and the salary benefits will be capped to a maximum amount of R17 712, 00 per month, per Employee and an Employee will be paid in terms of the income replacement rate sliding scale (38 % -60 %) as provided for in the Unemployment Insurance Fund Act 63 of 2001. Should an Employee’s income determined in terms of the income replacement sliding scale fall below the minimum wage of the sector concerned, the Employee will be paid a replacement income equal to minimum wage of the sector concerned.
Further to the above, to qualify for the TERS benefit the Employer must be registered with the Unemployment Insurance Fund and must comply with the online application procedure as set out in the Department’s media statement.
We encourage Employers to remain compliant with labour laws and to take heed of the plea from the Department of Employment and Labour to compassionately engage with Employees in attempt to find reasonable solutions to avoid retrenchment and short time work implementation. If you are an Employer in financial distress due to COVID-19 we can assist you with your TERS application, alternatively if your application is declined we can assist you with cost effective methods to assist your business during this time.
We have published a number of articles on the topic of retrenchment and alternatives to retrenchment such as short time work, utilization of annual leave and unpaid leave and in particular what the rights and obligations of Employers and Employees are during this public health catastrophe. The links to the publications for ease of reference are:
We also offer documents Employers may need (employment contracts, HR Policies, Warnings, Short Time Work and Retrenchment Packs), just to name a few, for download at https://www.contracts4biz.co.za/login.html the costs of which range between R75 and R395 per document for download. Registration is free and the download ensures that Employers can save on costs and time, which is how we are doing our part in this difficult time! For some further advice on the process of short time work and retrenchment which could very well be the consequences of COVID-19, have a listen to our brief podcast on the process at: