Why Compensation Fund is important to Domestic Employers
Author: Estelle Carstens Date Published: 15 September 2022
The inclusion of Domestic Workers under the Compensation for Occupational Injuries and Diseases Act (COIDA) was long overdue! The ruling followed, and was made retrospective, after a landmark case where a Domestic Worker passed away while on duty, cleaning windows.
Responsibility of the Employer
Many Domestic Employers who hire staff in their household are unaware that they should be registered with the Compensation Fund. It is the responsibility of the Employer to register and is compulsory upon the employment of household staff.
Domestic Workers, who is any employee in a home environment, are now entitled to compensation should they be injured, contract a disease, or in the case of death – all while on duty.
Some people still refer to the Compensation Fund as the previously known Workmen’s Compensation. It is a social protection and a basic human right which protects against certain life risks and social needs.
COID provides payment of compensation to employees who suffer injuries or contract a disease while on duty. In the case of death, COIDA allows compensation to be paid to the deceased employee’s dependants.
Court Ruling, retrospective
This all followed after a landmark finding in Mahlangu and Another v Minister of Labour and Others. A Domestic Worker died during her duties – she was washing windows using a step ladder. She slipped and fell into the pool, which was also uncovered and unfenced. Prior to the November 2020 finding, Domestic Workers were not classified as “employees” when interpreting the COID Act. As a result, neither the Domestic Worker or her dependents could claim from the Compensation Fund.
On 19 November 2020 the Constitutional Court confirmed that the exclusion of Domestic Workers from the COID Act is unconstitutional. The Court ruled that with immediate effect, Domestic Workers should be included as “employees” under the COID Act and furthermore, the inclusion is retrospective from 27 April 1994.
Domestic Employer to register with the Compensation Fund
It is the responsibility of the Domestic Employer to be registered with the Compensation Fund. This is a once off registration. During the registration, it must be declared what the date of hire is of the Domestic Worker – keeping in mind that the ruling is retrospective to 27 April 1994.
Annual submission to the Compensation Fund
On an annual basis, Return of Earnings are to be submitted to the Compensation Fund. Based on the subclass of the Domestic Worker employment sector, the Compensation Fund will make an assessment and invoice the Employer an amount due and payable to the Compensation Fund directly. The current assessment fee is 1.04 of annual earnings. Keep in mind that for other employers for example operating in a high-risk employment class like the security industry, the assessment fee will be much higher.
If you are not registered with the Compensation Fund as a Domestic Employer, be sure to rather mitigate risk. Domestic Support specialise in employment and labour relationships between Domestic Employers and their staff. Get in touch with Estelle at estelle@domesticsupport.co.za or call 071 894 5468 to get you registered with the Compensation Fund.
For general information on UIF registration and Employment Contracts, email Elna at info@domesticsupport.co.za
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