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UIF TERS Open for May Applications

UIF TERS Open for May Applications

Mark Hewitt

As part of the government’s response to the negative economic impact of the COVID-19 Lockdown, the Unemployment Insurance Fund (“UIF”) has been managing the processing and payment of claims submitted in relation to the Temporary Employer/Employee Relief Scheme (“TERS”).

The total payments made to employers/employees, as confirmed by the Department of Employment and Labour (“DEL”) on 26 May 2020, is just over R 15 billion. These payments, however, only relate to the month of April. UIF TERS relief for May has been long awaited by employers and employees.

At midnight on 26 May, the UIF officially opened the application process in relation to UIF TERS claims for the month of May. The press release by the DEL can be found HERE.

Unfortunately, due to technical problems experienced on 27 May, the application process was delayed. The UIF has now confirmed that the problem has been resolved and the website is currently accepting May claims once more. The press release which explains the technical problems can be found HERE.

Online applications can be made by clicking HERE.

A step-by-step guide has also been released to assist applicants. The guide can be found HERE.

The DEL has furthermore made additional amendments to the UIF TERS on 15 May 2020 and again on 26 May 2020. The most recent amendments can be found HERE and HERE.

The amendments effect the following changes:

1. Employees can now directly apply to the UIF TERS, as opposed to waiting for the employer to apply, subject to the following requirements being met:

  • The employee must suffer a loss of income or has been required to use annual leave during the Lockdown period by the employer;
  • No Bargaining Council or entity (an ‘entity’ is defined as any juristic person that has employees or employers as members and is permitted to pay COVID-19 benefits to employees directly or indirectly through its employer members) has concluded a MOA with the UIF; and
  • the employee’s employer has failed or refused to apply for UIF TERS benefits.

2. The definition of “Workers” has been added to the TERS Directive and is defined as follows:

  • a contributor; or
  • an employee as defined in the UI Act, which should have received benefits under the TERS Directive, but did not as a result of the employer failing to:
    • register as an employer per section 10(1) of the Unemployment Insurance Contribution (“UIC”) Act [failure to register as an employer with the DEL or SARS];
    • provide details relating to the employees in contravention of section 10(3) of the UIC Act [failure by the employer to submit the UI19 declarations]; or
    • pay the contributions as contemplated in section 5(1) of the UIC Act in respect of that employee [failure to pay the UIF contributions by employer and employee].

The recent amendments are welcomed as it will enable “workers”, who were previously declined UIF TERS relief due to error codes such as “Employee not declared”, to now re-apply and be approved on the system for UIF TERS relief. We are of the opinion that this will resolve a significant amount of payments that have been blocked. In addition, the amendments now permit workers to apply on behalf of himself/herself - provided the employer does not apply on his/her behalf to the UIF TERS.

The DEL has not clarified whether or not a new application must be submitted for the workers that were previously declined, but are now eligible or if the UIF TERS will identify those cases and release payment manually.  A third option exists where the employee’s UIF TERS claim, that was previously declined for April, is included in the May submission, but the “Shutdown From” date is left as 27 March 2020 as opposed to 1 May for employees that did obtain relief for April. This should result in a larger payment to these employees to ‘catch-up’ on the relief that was not paid for April and are still under dispute.

We are awaiting clarity in this regard.