Chapter IX: Obligations of Employers

Although no part of the COIDA can be said to be unimportant, this chapter is regarded by experts as particularly important when it comes to the administration of the Act.   The reason for this is mainly that the CC’s office is far more focussed on the obligations of the employers than the rights of the injured workers for whose purpose the legislation was originally established.  There appears to be no sympathy with defaulting employers whilst the CC’s obligations to injured employees leave a lot to be desired.  Late payment of benefits to the injured and medical accounts are regularly reported in the press and discussed in appropriate forums but to no avail.

Therefore, it is important for employers to be fully aware of these obligations provided for in the Act in order to avoid being penalised for every possible mistake.

Summary of the important obligations in chapter IX

The sections that are relevant relate to:

  • A person or company carrying on business and who employs someone shall within the prescribed time register with the office of the CC.  The form used for registering must be in accordance with the one prescribed in terms of the Act.  The employer should be familiar with the procedures and the relevant prescribed forms;
  • The employer shall for at least 4 years after the date of the last entry keep the records of the remuneration paid to employees; and
  • Before or on 31 March of each year the employer must furnish the CC in the prescribed form the Return of Earnings for the previous year and the current year. (section 82 )

In section 83 provision is made for the different tariffs of assessment for different industries.  What it means in simple terms is that an employer within a specific industry is assessed according to the associated risk.  As an example it can be mentioned that a mine will be assessed at a much higher assessment rate than that of a bank.  There is also a prescribed minimum assessment for certain employers.  The big risk is where the employer fails to submit the annual Return of Earnings when the CC can then estimate the assessment and the employer will have to pay the estimated assessment which will be considerably higher than the one that would have been based on the earnings furnished as explained above.

The heading of section 84 can be very misleading.  Only the state and some licensed local authorities are exempted from paying assessments.  Every employer including the State is bound by the compensation for injured employee provisions.  There are two insurance carriers other than the compensation fund namely Rand Mutual Assurance and the Federated Employers Mutual Assurance Co.  The first registers employers and pays compensation in the mining industry and the latter caters for the building industry.  Employers in these industries pay assessments to these mutual associations so they are “exempted” from paying the CC.  They are, therefore, not in the true sense of the word “exempted” from paying assessments.

Section 85 verifies the fact that it pays financially for employers to promote safety in the workplace.  Although there is a standard rate for all employers in a specific industry, the CC can award a lower rate of assessment if it is clear that the employer’s claims cost is far less than the assessments paid.  The opposite can on the other hand lead to an increase in the assessment rate and thus a higher assessment.  Employers must apply for such a reduction as the CC will not out of own motion take the initiative.

Sections 86 to 88

These are straight forward sections and deal with the calculation and the payment of assessments.  Just a single remark, please pay the assessment before the due date to avoid hefty fines and penalties.

Section 89

Ever heard of a good standing certificate?  It is a certificate that a contractor must obtain to the effect that he has registered with the CC and that his assessments due are up to date.  The principal for whom the contractor is doing the work must insist on such a certificate.  Should the contractor fail to register and pay assessments up to date, the principal will be held liable as if he is the employer of the employees of the contractor and pay the assessments.  This is an important section and employers should always bear it in mind.

Till next month