Extension of COVID-19 TERS Scheme and Other Employment Related Matters

Yesterday (21 July 2020), the Department of Employment and Labour announced a very welcome extension of the COVID-19 TERS scheme until 15 August 2020.  The Deputy Minister announced this, along with some other noteworthy points at the Budget 31 conference. Therefore, in the blog today we will be looking at these latest proposals to counteract COVID-19 and stimulate the economy.

COVID-19 TERS

Update 4 August: The cut-off point for April and May TERS applications has been extended and closure will be subject to 14 day’s notice – Read more here.

As stated above, the TERS scheme  has been extended from 31 June to 15 August, providing an extra one and a half months of crucial support to help retain employees.

In her speech, the Deputy Minister also stated that the UIF is considering closing applications for April and May at the end of July, so we would strongly encourage you to apply if you haven’t already . It should be emphasised that all valid applications made before 1 August will still be processed and evaluated; 31 July is just a cut-off point for new applications.

COIDA

The Compensation Fund has stated its commitment to consider any claim from workers who contract the virus while at work. Successful applications could receive:

  • a pay-out for temporary disablement while the worker is in quarantine, self-isolation or hospitalized;
  • a payment of medical expenses; and
  • where the illness tragically results in fatality, the Fund will pay out survivor benefits to dependents in the form of a monthly pension and funeral benefit.

We covered such applications to the Compensation Fund in our very first COVID-19 Blog and more information on how to make submissions can be found in this Government Notice.

Additionally, proposed amendments to COIDA were outlined, showing the Compensation Fund’s new direction towards a “Rehabilitation and Return to Work Programme”. We shall keep our eyes open for updates on this in the near future.

Contacting the UIF

The UIF is revamping its call centre to better meet your needs. Changes include the introduction of an App and USSD services, which are due to go live in August. These changes are based on the feedback and issues encountered during the running of the TERS scheme; hopefully this will mean that we will benefit from a sleeker and more efficient system in the future. 

Additionally, the UIF has indicated that 10% of its assets will be set aside for use in Labour Activation Programmes. These programmes will support jobs and training as dictated by the needs of the labour market.

Other Announcements

The following additional points are important to note based on the topics discussed:

  • If your business relies upon non-resident workforces, you should keep abreast of policy changes in this area. A National Employment Policy is being developed, starting with the fast-tracked creation of a Labour Migration Policy to address immediate challenges.
  • If operating back at the workplace, you must ensure your workplace has a workplace plan and is compliant (see this blog). The recruitment of an additional 500 Occupational Health and Safety Officers by the Government’s Inspection and Enforcement Services branch is likely to be completed this month. This will help ensure compliance with the Health and Safety Regulations for returning to the work-place.
  • You should check your current health and safety protocols in preparation for updates to the legislation. The Occupational Health and Safety Amendment Bill is to be tabled for the current session of Parliament.
  • It is imperative that you are complying with the National Minimum Wage Act. The CCMA (Council for Conciliation, Mediation and Arbitration) has been working closely with Government branches to help enforce compliance with the National Minimum Wage, resulting in the recovery of short pay to workers.
  • Public employment services are to start operating mobile services across all provinces to bring the services to work-seekers. Additionally, an online registration process will be put in place to help accommodate social distancing.

Although this was just a speech, the proposals outlined are encouraging as they indicate an intention to continue supporting South African Businesses and people. Hopefully they will come into force smoothly.

If you would like to read the full speech by Deputy Minister Moloi, you can find it here

We hope that you have found the above information useful. If you have any questions on how the information above relates to SimplePay, please feel free to contact us at i[email protected]  

Equally, if you are not yet a client of SimplePay but would like to be, or if you’d like to know how we can take the effort out of filing and calculating payroll, get in contact with us or visit our website: www.simplepay.co.za.

Keep well and stay safe.

Team SimplePay

Update: June TERS Applications

Since the announced opening of TERS applications for June, mentioned in our blog, the application portal site has experienced technical difficulties. This has resulted in June applications being closed until this glitch is ironed out. 

In a media statement, Minister Maruping suggested that testing may be done by Friday, so that applications for June can be reopened over the weekend.

The full media statement can be read here.

We hope that this information has proved useful to you. If you have any questions on how the information above relates to SimplePay, please feel free to contact us at [email protected]

Equally, if you are not yet a client of SimplePay but would like to be, or if you’d like to know how we can take the effort out of filing and calculating payroll, get in contact with us or visit our website: www.simplepay.co.za.

Keep well and stay safe.

Team SimplePay

Update on TERS May Applications and June Applications Now Live

You may have noticed it’s been a while since we have had a blog with the word TERS in the title. This is a good thing! This is a reflection of how the process has been streamlined and clarified through the hard work of the UIF. This blog therefore aims to provide a consolidatory recap on some of the questions which remained outstanding since our last blog on TERS.

Application Process for May

As we’re sure you are aware, the application process for May is much the same as the process was for April, being made via the online portal at https://uifecc.labour.gov.za/covid19

The Department of Employment and Labour has released a TERS May 2020 Applications – Application Guide (Application Guide), which provides you with a step by step guide on how to Apply for May. Additionally there is an attached FAQ for common problems experienced during the process.

Applicants Reapplying in May, Having Received TERS Benefits for April

If you are reapplying for TERS benefits for your employees, having received TERS benefits for them for April, you simply need to follow the instructions laid out in the Application Guide (linked above).

One point to note is that in step 7 of the guide, if you select Yes to both questions one and two, then the system will re-submit your application for April (but with the altered date range). This can lead to errors. Even if you think the above is correct, we would advise you to submit a new application and attach a new CSV, lessening the chance of errors.

Having uploaded your new CSV, you can submit and that’s it! your application is filed!

Applicants Reapplying in May, Having Not Received TERS Benefits for April

Although the UIF has made significant inroads into the backlog of April Applications, there are still a limited number of unpaid applicants. If you have not received any payment for any of your employees for April, the last FAQ in the  Application Guide would suggest that you nonetheless can apply. Unfortunately, it is not stated what you should put in place of the proof of payment to employees, under step 6 of the Application Guide. We would imagine that, similar to entities applying for the first time in May, you can substitute proof of payment with a letter in the format prescribed in step 6. We would though recommend you verify this with the TERS call centre on 0800 030 007.

If some of your employees have received TERS benefits in April, but you are still awaiting payment for some, you can continue to apply for all of the employees for May. When the employees who are yet to receive TERS payments, do get payment, proof of payment can be sent to [email protected].

Points of Note for Applicants in Non-standard Situations

Applicants Applying in May for the First Time

Note: You will first need to register. This can be done at https://uifecc.labour.gov.za/covid19/, by clicking on Register. The steps which should be followed are the same as in the Application Guide, save for what’s mentioned below.

At the opening of May Applications, employers wanting to apply for the first time in May encountered the problem that they were unable to provide proof of payment of benefits for April (Step 6 of the Application Guide).

The UIF has now put forward a solution. Employers who have not applied for April relief must attach a signed letter, on a company letterhead, confirming that they did not apply in April. This needs to be signed by the director or CFO of the company and attached in PDF format under “Signed Proof of Acceptance Letter”.

In step 7 you should select No to both questions and the shutdown date range should reflect the date range your operations were totally or partially closed for this period. After clicking PROCEED, you can fill in the staff for which you wish to claim. SimplePay provides a TERS CSV download, saving you the arduous task of inputting all employees manually. More information can be found on our related help page, linked here.

Extra Info

Advance Payments – Setting Off 

Due to the quantity of applications and number of possible reasons for delay, it is likely that TERS benefits are not always released to employees in timely, periodic instalments. This can clearly create all manner of difficulties for your employees.

To address this issue, if employers are able, they can advance money less than or equal to the TERS benefit amount to their employees, then set off this money when the TERS benefits are disbursed. The same principle applies for if it was agreed between the employer and employee that they would take annual leave, the sums the employer paid can be set off, provided the employee regains their leave entitlement.

We hope that this information proves useful to you. If you have any queries on how the above relates to payroll and the SimplePay system, please feel free to get in touch with our customer support team at [email protected].

TERS Applications for the Month of June

The UIF has announced that TERS applications for June are now open. To date there have been no new documents released for June applications, so we assume that the information provided above for May is also relevant to June applications. If you wish to verify this, we would recommend contacting the COVID-19 TERS hotline on 0800 030 007.

Keep well and stay safe,

Team SimplePay

TERS Applications for May Open

We are extremely happy to announce that this morning the applications for the COVID-19 Temporary Employer-Employee Relief Scheme (TERS) for the month of May have opened! For all intents and purposes, the application process appears to be the same as that in place for the end of the April application period. This means that you can still use the SimplePay TERS CSV export, subject to the few tweaks mentioned below.

To apply, go to https://uifecc.labour.gov.za/covid19 and log in if you already have an account, or register if you are applying for the first time.

You can then follow the application steps that are laid out on the site. An application guide, along with a post application guide, can be downloaded from the application site by clicking on:

 Application info > Application Procedure > Click Here to Download Files

On the TERS application website, linked above.

Key Changes for May

There have been some key announcements made that change the picture of what COVID-19 TERS process looks like. Some of the key changes are detailed below. There is also a nice overview available in the latest media release from the UIF.

Distribution of the TERS Benefits

The UIF has announced that it will no longer be requiring employers or bargaining councils to act as conduits for the disbursement of TERS benefits to employees. Instead, the UIF shall be paying employees directly into their bank accounts.

The intention behind this change to the system is that it will hopefully result in employees getting paid faster. Employers are still expected to apply on behalf of their employees and will receive a payment breakdown from the UIF as confirmation of payment.

The options for the UIF to pay money to employers and bargaining councils remains open. However, the UIF advises selecting payment directly into the employee’s account to expedite the payment of employees.

Proof of Payment for Employers returning to Make a Second Claim

According to the UIF, employers who have claimed TERS benefits in April and are wishing to make a repeat claim for May, will be expected to submit proof that  payment was made to their employees. In the above mentioned media statement, it was stated that an electronic bank statement or letter of acknowledgement between the employer and employee would suffice. 

Bargaining Councils Applying on Behalf of Employers

In the main part, it is likely that applications to TERS are to be done by the employer on behalf of their employee for COVID-19 TERS benefits.

Alternatively, if you have agreed with your bargaining council and the UIF that they shall apply for TERS benefits for your employees, this agreement should be adhered to.

If you are in any doubt of whether it is you or the bargaining council who should make an application for COVID-19 TERS, we would recommend that you clarify this on the UIF hotline, on 0800 030 007.

Eligibility for Applying to COVID-19 TERS

The eligibility for applying to COVID-19 TERS has been a large subject of discussion in the past for some of our clients. The latest amendments to the Directive in May altered the wording, clarifying if an employer is eligible or not to apply on behalf of their employees. 

The take home of this new wording is that any employer who closes operations, to any extent, needs to apply to TERS for its employees. 

SimplePay TERS CSV Export

There are a few minor but noteworthy changes regarding to the TERS CSV export which we would like to bring to your attention:

  1. Date range

As this is the application for May, the columns labelled “Shutdown From” and “Shutdown to” should be completed to accommodate this. These columns will be blank on the CSV, so you will need to input the correct dates.

There has been no official guidance published on the date range to input if your business reopened part way through May. Therefore, in such cases we would recommend that you contact the UIF hotline on 0800 030 007 to confirm the correct date range for your bespoke set of circumstances.

2. Column Titles

In order to bring the SimplePay CSV export titles in line with the UIF online application table, we have changed the “Leave Income During Shutdown” column to “Remuneration During shutdown”

This column aligns with the column labelled “Remuneration For Work Done Or Work To Be Done in May 2020 (excluding Leave Income or Payment In Advance)”, found on the online TERS application portal. 

Employee Applications for TERS Benefits

Employees are able to apply for TERS benefits in very limited circumstances under this latest version of the TERS process. For an employee to be eligible to apply the employer must have refused or been unable to apply for TERS benefits, as well as other criteria being met. By and large this is not a recommended option in almost all cases.

We hope that this information proves useful for you in carrying out this month’s TERS application. For more information on TERS and other COVID-19 related subject matter, you can visit our dedicated help page.

We would like to emphasise that for applications for April, one of the key causes of delay was incorrectly inputted information. Therefore we would like to stress the importance of double or even triple checking that the information is both accurate and in the correct format, to maximise the chances of a smooth process.

If you have any questions on the information provided above and how it relates to SimplePay, please feel free to contact us at [email protected].

Keep well. Stay home. Stay safe.

Team SimplePay

TERS: Foreign Workers Update

Update 27 May: the UIF has announced a delay in the opening of COVID-19 TERS applications for May due to a break in the communications link between the UIF’s office and the State Informations and Technology Agency (SITA). Read the media statement here

The following information is taken from a Q&A Webinar with the UIF, presented by the UIF’s Directors for provincial support and stakeholding.

As mentioned in our previous blog, linked here, it has become apparent that there are some issues for foreign employees in receiving their TERS benefits. We have now gained further information from the UIF on the most reliable way forward for UIF to process TERS applications for foreign employees, as we shall explain below.

The Likely Problem

Through the information garnered from the above mentioned webinar, as well as our own investigations, which included several phone calls with the UIF, it seems that the problem with these claims stemmed from a mismatch between the various systems used by the UIF to receive and process information. In order to validate if an employee is eligible for TERS benefits, the UIF needs to link the employee’s UIF contributions to the claim made. In the application process, this phase could have failed for a number of reasons, with some possibilities being:

  • The employer had registered for the payment of UIF with SARS, but not with the UIF itself.
    • In order to be compliant, employers need to ensure they submit their monthly declarations to the UIF, as well as make payment of UIF contributions to SARS when submitting their EMP201.
  • The UIF Reference numbers were inputted incorrectly.
  • An initial incorrect application for TERS was submitted and rejected, but the UIF reference numbers of the employees were captured. This means if a second application is made, it will automatically be rejected as the UIF numbers are already on the UIF Claims system (this is a safeguard put in place to avoid double payment).

To try and widen the resources from which to validate TERS applications, the UIF requested SARS cross check applications against their records of contributions to the UIF. In order for this step to be passed, the submitted application had to be a perfect match with respect to the UIF number, PAYE number and ID number on the SARS system, otherwise payment would not be processed. These increased validation measures resulted in fewer than expected applications being validated, in particular those by foreign employees.

Throughout the above processes, it is possible that the use of a passport number as opposed to 

a South African ID number was problematic. We have been informed by the UIF that for May applications, they believe that they have addressed the underlying cause(s) of the issues encountered with foreign employee’s TERS applications.

Suggested Way Forward

The latest from the Department of Labour and UIF is that for foreign workers, declarations should be made through uFiling to increase the probability of successful submissions. We appreciate that this is an added administrative load for you and does result in you needing to manually input information, in comparison to the SimplePay direct submission from our site. Nonetheless, the UIF recommends you record these foreign workers on uFiling for this period, as it will hopefully make the claim process faster.

You will continue to be able to submit your UIF declarations directly to the UIF on SimplePay for your foreign workers, as this is still an accepted method. This means that if you are not able to submit declarations via uFiling, your foreign employees’ declarations should still be sent successfully through SimplePay. The uncertainty comes in at the point where the UIF needs to match contributions to applications and this is apparently where using uFiling increases the likelihood of successful claims.

When registering or signing in on uFiling, it is possible that you will already have some or all of your foreign employees listed. If this is the case you must search for any omissions or errors in information. It is equally possible that none of the employees have been pulled through from the direct submission due to the strain put on uFiling over this period. If this is the case, please input the foreign employees in question.

When TERS applications for May do open, it is worth noting that the TERS CSV export from SimplePay will remain with the foreign employees listed. We are awaiting confirmation on when May applications will open and what the final process will be. We anticipate that you can continue to use our CSV but will confirm as soon as we know for sure. During the Q&A sessions the UIF representatives indicated that significant work has been done on the TERS system to resolve the issues experienced with claims for foreign employees. We sincerely hope that this is the case and that May’s applications will go far more smoothly for you.

If you are already registered, it is important that you check that your foreign employees are registered under your company, as this will then allow the employees to be matched to the TERS claim, thus triggering payment.

You can register or log into uFiling by clicking on the relevant link at https://www.ufiling.co.za/uif/.

It is possible that for May it will not be necessary to carry out this step as the UIF system will have been updated to accommodate foreign employees. However, having your foreign employees registered on uFiling still sounds like the most reliable way forward at this stage.

We hope that this information proves useful to you. If you have any queries on how the above relates to payroll and the SimplePay system, please feel free to get in touch with our customer support team at [email protected]

Keep well. Stay home. Stay safe.

Team SimplePay

TERS for Foreign Employees and OID Comp Return of Earnings

The blog today has an update for you on the Compensation for Occupational Injuries and Diseases Act (COIDA) relief, and its annual return of earnings. Additionally, we have received a clarification for employers who applied to COVID-19 TERS for their foreign workers.

Foreign Workers: COVID-19 TERS

It has become apparent that foreign employees who have been enrolled for the Temporary Employee/Employer Relief Scheme (TERS) have had their applications rejected. This appears to be due to the TERS system not being able to recognise passport numbers. If this is the case for you and your foreign employees have not received payment, you must simply submit proof to the UIF of the employee’s contributions to UIF, where they shall then process the payments on their side.

For each foreign employee who has not been counted in the scheme, you need to send:

  1. The employee’s UI 19 Form (Information on where to find this can be found on our help site page, linked here).
  2. The consolidated UI 19 Form, submitted monthly by the employer.
  3. Proof of payroll for the period between January to March 2020. This could be met by the UI 19 form mentioned in point 2, but to be safe we would recommend payslips for the employee also.

All of the above information needs to be sent to [email protected].

Return of Earnings Submission Deadline

In our previous blog on 11 March, we informed you that the deadline for completing your Return of Earnings, or W.As.8, was pushed back from 31 March to 31 May. We can now inform you that this date has been pushed back further still to 30 June 2020.

Relief Measures in Light of COVID-19

To help lessen the financial burden on employers during this period of economic uncertainty, and to encourage compliance with COIDA, the Compensation Fund has announced the following measures:

1. Normally, late payment of assessment results in penalties and interest accruing until the amount is settled. The Compensation Fund has announced an exemption from penalties and interest for a 6 month period, between 29 April and 30 September 2020. 

Note: This does not alter any amounts due, it merely exempts employers from penalties and interest for overdue payments of assessment for the period.

2. For employers partaking in an instalments arrangement, the standard requirement of an upfront 20% deposit has been lifted.

If you wish to partake in an instalment arrangement, you can do this by sending a request to [email protected]

We hope that this information proves useful to you. If you have any queries on how the above relates to payroll and the SimplePay system, please feel free to get in touch with our customer support team at [email protected].

Keep well. Stay home. Stay safe.

Team SimplePay

UIF Submissions Update: 18/05/2020

Last week we posted a blog update covering electronic UIF submissions turnaround times. Thankfully it seems that in the interim they have started clearing the backlog and are processing newer submissions more quickly. With this in mind, we wanted to provide an update on the current state of UIF submissions in relation to TERS claims.

We are currently doing everything we can to ease the burden on UIF and ensure that they receive all the necessary submissions for the processing of TERS. We’ve limited immediate submissions to the past six (6)  months because we’ve been advised that as long as the UIF has submission information for Jan to March 2020, TERS applications will be processed. At this stage, it appears that the majority of clients experiencing issues with UIF submissions have encountered them during the TERS application process.

Unfortunately, because of the sheer volumes of data and the massive backlog at the UIF, we are not currently processing resubmissions further back than Nov 2019. This is to ensure that we do not overwhelm their electronic submissions channel and prevent the processing of newer declarations needed for TERS claims. Once the dust settles, we will begin resubmitting these backlogged, older declarations. If you need to urgently resubmit declarations for periods prior to November 2019, we would recommend use of another channel such as email or uFiling, simply because this means of electronic submission appears to be overloaded and struggling due to increased volumes from the lockdown.

We hope that this information proves useful to you. If you have any queries on how the above relates to payroll and the SimplePay system, please feel free to get in touch with our customer support team at [email protected]

Keep well. Stay home. Stay safe.

Team SimplePay

COVID-19 TERS Update

With many employers having now managed to traverse the process of applying for COVID-19 TERS, the questions following this often amount to: when will I hear back?; why have I received the amount I have?; how do I distribute the benefit?; or even, why has my application been declined?

In an attempt to answer these questions and support employers in correcting their applications, the Department of Employment and Labour has created an “After Application Support: COVID-19 TERS” guide.

n.b. The pdf, which can also be found on the Department of Labour website, duplicates page 1. A simple way to avoid confusion is follow the page numbers in red, located bottom middle on each page of the PDF.

Inside this guide, you can find information on the following:

  • How to log into your profile after submitting an application
  • How to check your payment status
  • How to get a report on payments made or declined (this includes where only some staff members have been declined)
  • How to complete and send the declaration and proof that you have distributed funds to your employees
  • When you might need to repay the UIF and how to do this (end of page 4)

Also found within the guide is a set of Frequently asked questions, on the following topics:

  • What if one or a number of employees are not present on either the successful or the rejected lists?
  • How much do I pay to each employee from the amount paid into my account?
  • I didn’t get paid as much as I was expecting, why might this be, and can I receive the full amount if I made an error in my submission?
  • I need to add more of my employees to my claim, how do I do this?
  • I have received confirmation that my CSV was uploaded correctly, but when I came back to my profile I see an error?
  • What happens if Lockdown is extended?

Employers Who are Still yet to Apply for TERS

Straight off, we should state that it is still possible to claim for and receive benefits from the COVID-19 TERS scheme. The scheme shall be running for up to 3 months, only being brought to an end by way of official notice. Whilst lockdown is still affecting jobs, this is unlikely to be imminent.

Where employers have not yet made an application and have tried to apply at https://uifecc.labour.gov.za/covid19/, they have been faced with a notification that applications for May are not yet open. The reason for this notice is that the Unemployment Insurance authorities need time to work through the backlog of earlier applications, as well as discuss and make changes to the TERS system, to hopefully allow it to run more smoothly. 

Unfortunately, there is no knowing when the application process will reopen, so we advise you to keep checking in on the page. As soon as we become aware that applications are reopened, we shall communicate this with you, along with any changes which hopefully make the process less cumbersome.

We hope that this information proves useful to you. If you have any queries on how the above relates to payroll and the SimplePay system, please feel free to get in touch with our customer support team at [email protected]

Keep well. Stay home. Stay safe.

Team SimplePay

Lockdown Recap Blog #4

Friday has come around again meaning, it is time for our blog rounding up the week’s events.

The contents of the blog today includes a summary of this month’s blogs to date, as well as some reiterations of key points that were made within these blogs throughout the week.

May’s Blog Posts to Date

Below you will find a list of the most recent blogs and their content, just in case you missed them!

8 May Update blog contents:

  • Clarification on COVID-19 TERS payout amounts, as well as the effect of additional payments made by the employer on the benefit amount.
  • UIF electronic submissions: new progress notification functionality to update you on your submissions.
  • SARS Updates: Note on the annual employer reconciliation period, as well as means to get updates directly from SARS.
  • ETI: Explanation as to how our system will be altered when the latest draft Disaster Management Tax Relief and Tax Administration Bills pass into law.

COVID-19 ETI relief blog contents:

  • Update on the amount of ETI an employer will receive for each ETI qualifying employee, during the period of 1 April to 31 July 2020.

Draft Disaster Management Bills summary blog contents:

  • Summary of the proposed amendment’s effects on ETI entitlements, SDL payment holiday and employer PAYE deferment.
  • Outline of the workplace requirements for employers reopening under lockdown level 4.

Summaries of the contents for the end of April’s blogs, as well as a COVID-19 TERS specific section can be found in our Lockdown Recap #3 blog

Alternatively, if you would like to see the full list of our blogs, including information about UIF claims, these can be found on our website.

Take Homes from the Week

Additions to the SimplePay Help Site

In order to help ease some of the confusion and concern around the lockdown, we have been very active in producing blog content dealing with the various measures to support businesses and employees. We have also created a dedicated COVID-19 Help section, which will be updated as quickly as possible as new information and requirements are made available.

If you have a query relating to COVID-19, we’d like to request that you consult one or more of the following posts and / or help articles (accessible from the two links above) as they contain the most up to date info we have and will hopefully resolve your query.

Annual Employer Reconciliation Period

SARS has not announced any extensions to the employer filing deadline of 31 May. We have made all the necessary arrangements on our end, so you can proceed with annual filing whenever you’re ready!

When can the Disaster Management Bills be relied upon?

As mentioned in previous blogs, the latest draft Bills are open to public comment until 15 May 2020. It therefore follows that soon after this date, they shall pass into law, possibly with minor changes made. 

A good indication of the progress of certain subject matter within the Bills can be gleaned from Government body websites and media platforms. An example of this being SARS’ twitter handle (@sarstax) today tweeted, that employer SDL contributions shall be defaulted to zero on their EMP201s, for the months of May to August. This therefore provides a strong indication of what will pass into law in the near future.

Calculation of the COVID-19 TERS Benefit 

COVID-19 TERS is a subject which has caused much confusion and media attention, not only in how to apply for this aid, but also how to distribute it to employers correctly.

As discussed in the 8 May Lockdown blog post, the Department of Labour has released an FAQ document, hopefully providing clarity on many of the questions you may still have around the subject.

Returning to Work – Lockdown Level 4

Coming to the end of the first week back for many businesses, it is important to know where your responsibilities stand to your employees and otherwise under lockdown level 4.

Our blog from 5 May helps outline what you as an employer need to do to remain compliant when reopening your workplace.

We hope that this information proves useful to you, and that the first 5-day working week in a while has been kind to you. If you have any queries on how the above relates to payroll and the SimplePay system, please feel free to get in touch with our customer support team at [email protected].

Keep well. Stay home. Stay safe.

Team SimplePay

Lockdown Update: 8 May

In today’s blog we have an important update on how best to interpret employee TERS benefit entitlements and the effect of additional payments by employers to employees participating under the scheme. We shall also touch base on tracking of UIF applications, updates from SARS and cast our eyes forward with respect to ETI.

TERS Payouts

Please note: This information is a reiteration of information provided by the Department of Labour on 30 April. It is provided for informational purposes only and is to the best of our knowledge correct at the time of publication.

Our previous blog based on information posted by SAICA on 29 April, suggested that employer contributions may greatly reduce the amount employees receive from the TERS benefit, as well as underestimating TERS benefit amount. The Department of Labour has since published its own FAQ document (linked below), which has shown that this was not correct. We unreservedly apologise for any inconvenience and angst this has caused you.

The following information is based on the Department of Labour FAQ (referenced as the DoL FAQ going forward), published 30 April 2020.

The amount that will be provided to each employee ranges between a minimum of R3 500.00 and a maximum of R6 638.40. This is further explained at the top of page 5 of the DoL FAQ.

Calculating an Employee’s TERS Payout

On pages 5-7 of the DoL FAQ, they explain how to calculate the TERS payout amount for an employee, before taking into account employer additions.

Benefit amount = Daily income x Income Replacement Rate (IRR)

To calculate the benefit amount, the above formula must be used. How to calculate the daily income for your employee and their own IRR, are shown on pages 5* and 6 of the DoL FAQ above. However, note that, if your employee is paid R17 712 or more, then there is no need to follow this calculation, as the entitlement will be R6 638.40.

*At the base of page 5, the term “Yi” may lead to confusion as it is a different format to the worked examples found on page 6. If at all confused, we would recommend following the method shown on page 6, using the daily income for both the amount put into the IRR formula, and for the value which you multiply with the IRR.

Effect of Additional Payments from the Employer

According to the above DoL FAQ, the correct interpretation of employer contributions is that they will not affect the employee’s benefit amount, unless the reduced salary and the TERS benefit amount would result in the employee receiving more than their normal remuneration if there were no lockdown.

For further explanation of this please refer to Page 7 of the DoL FAQ. 

Submissions of Electronic UIF Declarations

Since the lockdown came into force, there has been an influx of applications to the UIF, which has caused a delay on their end.

To help inform you on the progress of your application when using the SimplePay UIF Declaration function, we have updated our system to give you an expected time period for reply from the UIF when:

  1. You make the submission on the SimplePay Website.
  2. When your submission appears in the UIF list as awaiting_response.

When you go to your submission, under the “Electronic Status” heading, you will see a question mark in a blue circle. Hover your cursor over the question mark to show the expected response time, based on the up to date average processing times.

SARS Updates

For all the latest information from SARS, we would suggest following them on twitter (@sarstax). They are releasing nice bite-sized tweets on the various COVID-19 support measures, providing seemingly straightforward guidance for employers.

Annual Employer Reconciliation Period

SARS has not announced an extension to the annual employer filing period, meaning currently the deadline remains at 31 May. We are happy to announce that all of the necessary arrangements have been made on our end for you to proceed with your annual filing on the SimplePay site.

ETI Updates

The system has now been updated to cater for the expanded ETI, in effect from 1 April 2020 and covered in this post from 6 May. We would like to thank all of you who held off on doing April EMP201 submissions while we made the necessary updates.

The new draft Disaster Management Bills propose a further widening of ETI by relaxing the requirement that employees have an employment date before 1 October 2013. As this is still in draft form, we will not be making further system changes yet – as soon as there is confirmation of it passing into law, we will communicate this and make the necessary updates to the system – please keep an eye on our blog and in-system notifications.

We hope that this information gives clarity on the TERS payout and helps you in understanding what is a very complex subject, as well as keeping you in the loop on UIF and SARS. Should you have any queries over the content or processes to follow within this blog, please contact our support team via [email protected].

Keep well. Stay home. Stay safe.

Team SimplePay