Guide to Employee benefits in South Africa



Not all South African organizations provide a complete variety of employee benefits, nor do they need to. While the government provides some social security benefits to certain members of society and companies must contribute to specific funds, benefits like retirement funding and medical insurance are personal matters.

 Wondering which employee benefit contributions are mandatory and which are not? In this post, we give you a quick breakdown. Note, as previously, that retirement financing and health insurance aren’t compulsory unless a part of public sector employer schemes or as governed under a Bargaining Council Agreement.

Legally required employee benefit contributions

  1. UNEMPLOYMENT INSURANCE FUND (UIF): All employers must register their employees for and contribute to the UIF. The employer must pay 1 percent of a worker’s salary into the fund, and a further 1% of the worker’s salary is to be withheld and paid to the fund on a monthly basis.

2.The SDL is enforced to promote development and learning in South Africa and is driven by an employer’s salary bill. The employer must make contributions and the funds should be utilized to develop and enhance the skills of workers. The amount is covered by an employer on a monthly basis, has no limit, and amounts to 1 percent of the sum paid to each of the employer’s workers each month (such as overtime payments, leave pay, bonuses, commissions and lump sum payments).

  1. COIDA modulates the reimbursement of workers for occupational injuries and diseases. The fund will decide the danger of the particular industry and will employ a percentage fee to the sum of annual earnings announced to increase an assessment — this will be payable. COIDA works on a ‘no fault’ basis because workers that are hurt on the job or contract occupational diseases as a consequence of work are entitled to compensation regardless of whether the injury was due to their employer or another employee. However, compensation for injuries is based on the level of disablement therefore employees might be entitled to greater reimbursement when the disablement was caused by the carelessness of their employer or a fellow worker.

At the moment, the government provides lots of means-tested social grants to aid the lowest income groups, where the necessary savings and benefits are out of reach. The fact remains that the government struggles to fulfill even the most basic of living standard needs with those grants and faked contributions so the necessity to provide working people financial security for the future and in times of crisis often falls to their employer — in the kind of wages and other benefits. To this end, some companies take part in group health and life insurance plans, in accordance with company policy or collective agreement. The exact same is true of retirement and retirement benefits.

By contributing to offering important and respectable benefits, companies can help protect the wellbeing of the employees (thereby benefiting their organization in terms of increased retention and productivity). They’ll also be contributing to society at large by adding to the economy and increasing the standard of living and care for income earners.

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