Business SA urges ‘maximum generosity’ during lockdown
Business organisations have written to their members to provide guidance on the payment of wages and salaries during the lockdown, urging them to exercise “maximum possible generosity.”
Business Unity SA and the Black Business Council have joined forces over the Covid-19 crisis in a group now called Business SA. The group, which includes large and small business, recognises the different circumstances of various business and sets out the options the employers face, depending on their circumstances.
Together with labour and government, business has been negotiating the nuts and bolts of the special Covid-19 employee and employer benefits in Nedlac, with a view to cutting red tape and shortening processes. For employers who are willing and able to pay employees for the duration of the lockdown or for a period of the lockdown, either on full pay or “short time”, this is the first prize.
For employers who are not able to do this, the next best option is to require workers to take annual (paid) leave. The Basic Conditions of Employment Act gives employers the right to determine the timing of annual leave, where agreement is not reached.
But where annual paid leave is exhausted the situation is nuanced. Employees can still be placed on leave, for which they must bear the cost. In the ordinary scheme of things, an employer can’t force someone to take unpaid leave. But in this case, the employer can say that as the employee is unable to work — for reasons beyond their control — the employer is not required to pay them. While this is not strictly “unpaid leave” — it is more a mitigating effect — it nonetheless has the same end result.
Where it is not feasible to pay employees to take annual leave because annual leave is exhausted, employers can require employees to take unpaid leave. In this case, employers may be able to access the Covid Temporary Employment Relief Scheme (Ters), which operates through the UIF fund.
Under the scheme, which in the past was used to temporarily remove workers from the payroll in exchange for a training stipend from the fund, employees can access a portion of their usual wages on a sliding scale. The minimum that will be paid will be equivalent to the minimum wage of R3,500 and the maximum R17,500. This applies to employers that intend to restart production after the lockdown. The benefit can be accessed for three months.
However, BSA has advised members not to apply for the Ters benefit just yet as the some of the rules, requirements and procedures may still be revised. Under the old scheme, employers had to demonstrate financial hardship and the procedures required the filling in of several forms.
Business is also aiming to secure, in the Nedlac negotiations, a change to the scheme that will enable employers to make some contribution to wages in addition to the benefit. Under the old scheme, the benefit could only be accessed if employees received no remuneration from their employer at all.
Businesses that now or at some time during the lockdown determine that there is no option but to close down will need to initiate the normal procedures for retrenchment under the Labour Relations Act, advises BSA. Employees that are retrenched, and who have been contributors to the UIF, will be able to access the fund’s normal benefits for 12 months.
In essential service industries where employees are required to be on-site, they must receive full pay. Employers have a duty of care to employees who are on-site to provide them with the protective equipment they need. Normal rules of remuneration apply to those working from home.