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Managing Compensation Fund

What is a Compensation Fund?

The Compensation Fund is a fund that is there to provide compensation for workers who are injured at work; or become will with diseases that are contracted at the work site. It is also a fund that will provide compensation for any death resulting these injuries or diseases. It is covered by the Compensation for Occupational Injuries and Diseases Act (No 130 of 1993) (COIDA) and the Compensation for Occupational Injuries and Diseases Amendment Act (No 61 of 1997), A Compensation Commissioner is appointed to administer the fund and approves claims of workers. Compensation is made from the Fund and NOT the employer although the employer is required to make payments for the first three months post injury and will be reimbursed from the fund.

Register

To manage the Compensation fund properly, as an employer you first need to register with the Compensation Fund you must use the following steps:

  • Fill in the form
    • Employers must fill in the W.As2 form, which you can get the form at any labour centre or on the website.
  •  Employers must make sure that they fill in all the questions on the form. (failure to do so will increase registration period) - If the Compensation Fund has to follow up on information that they did not fill in, it may take a long time to be registered.
  • Send in the form
    • When sending in the forms you must also include a copy of –
      • the registration certificate from the Registrar of Companies if you are a company or closed corporation;
      • or your ID document (sole owners of the business)
  •  send the form by mailing it to:
    • PO Box 955
      Pretoria
      0001

Your workers / employees do not pay anything into the fund so you cannot deduct this from your workers / employees wages. If you are an employer registered with the Compensation Fund, you are required by law to pay an annual assessment fee based on your workers’ earnings and work related risks. As a result you must therefore complete and submit an annual return of earnings form to the Compensation Fund.

After receiving your return of earnings form, the Compensation Commissioner will determine the assessment fee you should pay. The Compensation Fund will generate a notice of assessment and send it to you, indicating how much you should pay. You must pay the assessment fee within 30 days of receiving your notice of assessment. If you fail to pay within 30 days, you will be charged interest and penalties.

Note: It is your responsibility to contact the Compensation Fund if you have not received a notice of assessment.

Claims and compensation payments are made in accordance with the strict guidelines that are stipulated by the fund. It is also important to note that as dictated by the Act, it is the employer who has to pay compensation to the injured worker for the first 3 months from the date of the occupational injury. The Compensation Fund will then repay the employer the monies that were paid out. Make sure you are well versed with the claims process and claims requirements as these would need to be communicated to your staff on an ongoing basis, failure to comply could result in a non payment of claims.

For more information go to www.labour.gov.za – read up on the Compensation Fund. It is critical that you do.

 

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