July Newsletter

ATTENTION WE ARE MOVING! From the 30th of July our new address will be:
Ground Floor, Wrigley Field Building
The Campus, 57 Sloane street
Bryanston, 2021
UIF for Foreigners
The Unemployment Insurance Fund (“UIF”) allows employees who contribute monthly to receive benefits from the fund if they are unemployed due to circumstances such as dismissal or maternity leave.  UIF also assists dependents of deceased employees who contributed monthly to the fund.
There are two pieces of legislation that govern Unemployment Insurance, namely the Unemployment Insurance Contributions  Act which governs contributions to the UIF, and the Unemployment Insurance Act which governs the benefits available to contributors. The Unemployment Insurance Contributions Act was promulgated in 2002.
The act applied to all employers and workers except workers working less than 24 hours a month for an employer, learners, public servants, foreigners working on contract, workers getting a monthly state pension and workers only earning commission.
However, from 1 March 2018, amendments to the Act have been promulgated and foreign employees working within South Africa, as well as their employers will be required to contribute to UIF. It has furthermore been extended to also apply to learners employed in terms of section 18(2) of the Skills Development Act.  Both parties shall be required to contribute 1% of the employee’s remuneration to the Unemployment Insurance Fund each month.
Contributions are limited to an amount as determined from time to time, but currently set at R148.72 per month. The current limit is set at salaries of R178 464 per annum, being R14 872 per month. Therefore, where an employee earns over this amount, their contribution will be at the set limit of R148.72 per month.
Should a foreign employee remain on the payroll of a foreign country, but works in South Africa, it is not necessary for the employer to deduct PAYE. The employer does however have to contribute to the Skills Development Levy and Compensation Fund.
When deducting UIF, an employer may not deduct more than the prescribed UIF amount, and may not charge a fee to the employee for this deduction.
In July 2017, the South African Human Rights Commission was vocal about the importance of a judgment handed down by the Equality Court regarding the issue of UIF and foreigners. In this situation, an asylum seeker was denied from claiming his UIF benefits because the system could not pay him if he did not possess a 13 digit bar-coded South African ID document. The Court awarded that the system be amended to rectify this, and the asylum seeker received the UIF benefits as well as damages.
It is clear that the law in South Africa is ever changing to provide increasing rights for employees, regardless of their origin. Employers must thus ensure compliance with the latest legislation and ensure that if they employ foreign nationals, their payroll systems are updated accordingly.
For any payroll queries, do not hesitate to contact our Payroll Division on 079 504 1293…
Minimum Wage Increase in the Hospitality Sector for 2018:
“The new Hospitality Sectoral Determination governing the new minimum wage will be in effect from 01 July 2018 until 30 June 2019.”
The new changes will apply to all workers falling under the Hospitality Sector, including employees that work in Hotels, Inns, Resorts, Restaurants, Pubs, and Catering etc.
The new minimum wage for 2018/2019 for employers with 10 or less employees is as follows:

  • R3 384.71 monthly (2017: R2 959.35);
  • R781.14 weekly (2017: R689.97)
  • R17.34 hourly (2017: R15.17)

The new minimum wage for 2018/2019 for employers with more than 10 employees is as follows:

  • R3 772.65 monthly (2017: R3 298.52)
  • R870.62 weekly (2017: R761.25)
  • R19.35 hourly (2017: R16.91)

‘Please take note that the Hospitality Sectoral Determination does not apply to employees involved in trading and letting of flats, rooms, houses or to employees who are governed by another Sectoral Determination or parties who fall within the provisions of a Bargaining Council .’
FIRED!!! No I Resigned…
Employers and employees are often confused about what constitutes constructive dismissal.
The very basic definition of a constructive dismissal may be defined as “a situation in the workplace, which has been created by the employer and which renders the continuation of the employment relationship intolerable; to such an extent that the employee has no other option than to resign.
Employees in particular have a wrong understanding thereof and have been unsuccessful when referring a constructive dismissal matter to the CCMA or relevant Bargaining Council, when failing to prove the introduction of any intolerable working condition. Referrals based on the refusal of salary increases, refusals of bonuses or being overlooked for promotions are bound not to succeed.
The onus lies on the employee’s shoulders to prove a constructive dismissal, which is particularly difficult. In order for an employee to have reasonable prospects of winning a constructive dismissal case, he/she has to convince an Arbitrator of the following:

  • That the circumstances of the employee are so intolerable that he/she cannot remain employed with the company;
  • The unbearable situation was caused by the employer;
  • The unbearable circumstances caused the employee to resign;
  • There was no alternative option at the time and the employee was forced to escape the circumstances;
  • The employer was in control of the unbearable circumstances; and
  • The employee exhausted the internal procedures in an effort to resolve the issues that caused the alleged constructive dismissal.

Employers are warned that a dismissal based on the employer having followed an unfair disciplinary procedure, which resulted in the employee resigning COULD BE A VIEWED AS A CONSTRUCTIVE DISMISSAL.
However, an employee resigning in order to avoid a disciplinary hearing would NOT NECESSARY CONSTITUTE A CONSTRUCTIVE DISMISSAL.
If the employee was threatened to “resign OR face a disciplinary hearing and be dismissed” it would most likely justify a dispute of a constructive dismissal.
Employers and employees should keep in mind that various internal avenues should be explored first in attempt to resolve internal disputes. Employees should be given the opportunity to freely raise their concerns to management and be advised to follow internal procedures such as the grievance procedure to resolve disputes.
Please feel free to contact our offices on 0861 737 263 should you require any assistance whether it be about your grievance procedure, or for us to conduct your disciplinary inquiry.