DA accuses Nxesi of scapegoating employers for UIF’s admin errors

The Democratic Alliance (DA) has accused Minister of Employment and Labour Thulas Nxesi of attempting to “scapegoat employers” for administrative errors at the Unemployment Insurance Fund (UIF).

This after Nxesi said on Tuesday that it was not true that the UIF does not pay a lump sum to companies that have applied for funds from the Covid-19 Temporary Employer/Employee Relief Scheme.

Nxesi said the money was paid based on the payroll and all relevant figures submitted by the employer.

DA MP Michael Cardo said: “This is patently untrue. The minister is trying to scapegoat employers for the UIF’s own administrative errors. The fact is that many lump-sum payments have been made to employers in terms of the Covid-19 Ters [Temporary Employer/Employee Relief Scheme] benefit with no regard whatsoever for the company’s payroll.

“Many employers report receiving a payment breakdown that allocates and misallocates funds to individual employees without rhyme or reason.”

ALSO READ: Nxesi urges employers to assist employees in accessing Covid-19 relief funds

Cardo said the DA would write to Nxesi for the minister to answer “three key questions” on UIF.

“Firstly, why are the claims on behalf of so many foreign national workers being rejected by the Covid-19 Ters scheme, when they are fully UIF-compliant?

“Secondly, how exactly is Sars assisting the UIF to process and pay the Covid-19 Ters benefit? There seems to be no marriage of information between the UIF and Sars. Some companies report that up to two-thirds of their workforce have not benefited from the Covid-19 Ters scheme, even though every single worker is on the company’s payroll, they are tax-compliant companies, and they are able to furnish all the necessary EMP201 declarations that have already been submitted to Sars.

“Thirdly, in many instances, the UIF has paid no benefit on the grounds that the company’s salary contribution exceeds the UIF income replacement benefit. However, in terms of Clause 5.3 of the amended directive issued by the UIF Commissioner on 8 April 2020, the payment should be the UIF benefit (as per clause 3.6) plus the company’s contribution provided that it is not more than the employee’s normal salary. It would seem that the UIF has processed these claims incorrectly and is not acting in line with the clear wording and intention of the directive,” Cardo said.

Cardo called on Nxesi to act on sorting out the IT- and communications problems plaguing the UIF.

“Many employers cannot access the Covid-19 Ters website because it is constantly down. To make matters worse, phone calls and emails go unanswered. Minister Nxesi must act swiftly to steady the ship at the UIF before it runs aground.”

(Compiled by Makhosandile Zulu)

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