Wednesday, March 10, 2010 - FEDHASA

Labour lawyers have advised companies to ignore the new payroll demands being made by government - saying that the Labour minister and Commissioner appear to be at odds over a new law which itself is unreasonable and could be illegal. The COIDA commissioner Shadrack Mkhonto has announced new rules in respect of the employer annual return, due at the end of March, which includes new employer monthly return requirements, which are impossible to deliver according to labour experts. NuQ executive Chairman, Ron Warren, says these rules will also result in higher premiums payable by employers to the Commissioner being more than they should be. The new rules for COIDA or the Compensation for Occupational Injuries & Diseases Act include an extra page with additional requirements for the return requiring employers to give monthly details of the number of employees. Attempts at reaching the Labour commissioner were unsuccessful, department of Labour phones in Pretoria were not answered when Business Day attempted to obtain comment at midday on Tuesday.

Experts say the new law was only enacted through the government Gazette in July last year - but the commissioner has now demanded companies report the estimate throughout 2009. Warren says that apart from these completely unreasonable requirements, the Commissioner specifies an annual limit to the earnings requested above. "This is normal, however the annual limit he has specified for the earnings that were estimated in March 2008, will not agree with the actual estimate made then because those earnings would have been estimated on the limit then in force, which was R214 305 a year," says Warren. "The limit he is asking employers to use now for that past period is R239 172 a year, which limit was only gazetted by the Minister of Labour in August 2009, effective from 1 July 2009, not 1 March 2009."

Warren says in his opinion, employers in South Africa should refuse to complete the monthly earnings form now requested on two grounds -

1. It is unreasonable to ask for monthly information at the end of the reporting period, when no advance notice was given of this requirement, and most employers will probably have great difficulty in extracting such information from their old wage records.

2. The Commissioner is not above the law, and cannot ignore the effective date of 1 July 2009 for the new limit as published in the Government Gazette.

"For donkey's years all they asked for was estimates. Now you have to issue that estimate month by month - but not on basis originally made last year - but a new list, that's not only unreasonable, it's illegal," said Warren. He believes there's chaos in the Labour ministry with the Minister Membathisi Mdladlana and the commissioner Mkhonto not communicating effectively - Business Day