DON’T MISS OUT ON THE SICK BENEFIT FUND SUBSIDY

DON’T MISS OUT ON THE SICK BENEFIT FUND SUBSIDY

By Mark Mfikoe, National Director, ECA(SA) and Chairperson of the National Sick Benefit Fund Trustees.

As you may be aware, the electrical contracting industry entered into a new Sick Benefit Fund agreement, which is part of collective bargaining at least up to and including January 2022. We negotiated this agreement with the purpose of enhancing social security benefits for employees employed in the Electrical Contracting Industry. This agreement covers members and non-members alike and is largely to benefit employees but relieves employers of the burden of paying for sick leave, which as we all know, tends to be abused. We also felt that employees, working for those employers who are not members of the ECA(SA) and employees who are not members of the South African Equity Workers Association (SAEWA) should also participate in the benefit.

Prior to this new Sick Benefit Fund, we had regional benefit funds. Two of these funds were largely closed funds built up with contributions from ECA(SA) member firms only together with the employees that they employ. These have been discontinued and dissolved in terms of their constitutions.

In Regions A and B of the Bargaining Council, the parties decided to subsidise all companies in good standing. As you are aware, the bargaining council levies must be paid before the 15th of the month following the month they were billed. To give an illustration, the levy return for June 2018 must be paid to the council before 15 July 2018. Ordinarily employers that pay after this day would have violated the Bargaining Council agreement and their employees would not be in benefit.

The parties to the council have been generous enough to say that they will subsidise all employer’s contributions even if the contributions are received three months later. In our example, we would still subsidise if the contributions are only received in August 2018, due to any unforeseen circumstances.

Please note that should an employee fall sick and the contributions have not been paid, the Sick Benefit Fund will not pay out a benefit. The employer would then take over this responsibility.

It is important to record that should the employer not pay the contributions within the extended period, no subsidy will be paid, and the employer would then have to pay the full premium.

Currently, the employees contribute 0.2% of actual wages and the employer contributes 0.2% of actual employee earnings. The employer and employee each are subsidised with an additional 0.1%, which is paid by the Sick Benefit Fund. When the employer has not paid within the extended period, the subsidy will not apply, and the employer would have to pay the full 0.3% and the employee the full 0.3%. Let us avoid this situation.

The subsidy will be applicable until April 2019. Take advantage of it and pay on time.

 

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