TERS benefits during Covid-19
The Department of Labour has issued directives governing the Covid-19 Temporary Employer / Employee Scheme (TERS).
Who does TERS apply to?
TERS benefits apply to employers who are ‘facing distress” during the lockdown and are unable to pay salaries resulting from the lockdown.
In terms of the directives, TERS would apply if an employer during lockdown has required an employee, in terms of section 20 of the Basic Conditions of Employment Act 75 of 1997 to take annual leave. The employer may then set off any amount received from the UIF under the TERS scheme against the amount paid to the employee in respect of annual leave.
It should, however, be noted that the employer must have been contributing to UIF from before 15 March 2020, in order to apply for TERS benefits.
Applying for TERS benefits
The directives make it clear that should an employer close all or part of its operations as a result of the Covid-19 pandemic for a period of 3 (three) months or less then the employer must apply for the TERS Covid-19 benefits on behalf of its affected employees.
If the TERS benefits are applicable to its employees, then an employer has a duty to assist its employees in applying for the TERS benefits.
Payment of TERS
The total amounts received by the employee from his/her employer and TERS may not exceed the remuneration that he/she would normally receive. All employers are required to keep proof of all TERS amounts paid to employees and where applicable, may be required to pay excess amounts back to the UIF.
Payments made by the UIF will take into account the salary of the employee when calculating benefits, but the UIF has capped payment at an amount of R17 712.00 per month, per employee.
An employee may only receive covid-19 benefits in terms of the directive if the total of the benefit together with any additional payment by the employer in any period is not more than the remuneration that the employee would ordinarily have received for working during that period.
The UIF does allow certain instances where an employer may claim to be reimbursed after having paid its employees. This is at the discretion of the UIF, and such application would have to be supplemented with various documents.
When may an employer be required to refund the UIF?
Refunds may only become due if:
- the employer receives monies which amount to more than what the employees are due to receive (employees cannot receive more from their employer and TERS than they normally receive); and
- the employer is not going to rely on the reimbursement rule and keep the funds to himself if he has already paid employees some portion of the remuneration from his side.
The employer cannot refund the UIF more than what was received as TERS benefits. The refund can be made from the actual benefits received.
Can an employee apply for TERS benefits if an employer fails to do so?
The TERS benefit application process is done online, through the TERS platform, which would only allow an employer to log on. However, an employee may be able to apply for TERS benefits directly through the Ufiling platform, and not through the TERS online platform.
This article is not intended to provide legal advice. This article is a general information sheet and should not be used or relied on as legal or other professional advice. This article is based on research regarding the UIF and may be subject to change. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE).
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