• links

Blog


What is Workmen's Compensation Fund

31 Dec 2023
Author: Neil Helps

What is Workmen's Compensation Fund

To avoid losing your business due to unforeseen events, we are providing you with important information about Workmen's Compensation. SA Law mandates that you safeguard yourself and your employees.

Register with the Workmen's Compensation Fund to protect your workers from illness, injuries, and accident or death. For your company, it is important as this can mean the difference between whether your doors stay open or not. Many small businesses can't afford the backlash of a workers claim for injury or illness or worse, if uninsured.

All employers with workers must register with the Workmen's Compensation Fund. Each branch of your business needs separate registration, unless you have arranged for combined registration.

Frequently asked questions

Which type of employee does the coverage include

The compensation for Occupational Injuries and Disease Act applies to all employers and casual and full-time workers to who, as a result of a workplace accident or work-related disease are injured, disabled or killed or become ill.

There are exclusions. For example:

  • Employees who are partially disabled for less than 3 days

domestic workers

  • anyone receiving military training

members of the South African Police Service or South African National Defense Force

  • any worker who is guilty of willful misconduct

unless seriously disabled or killed

  • anyone who is employed outside of South Africa for 12 or more continuous months and workers working mainly outside the South Africa and only temporarily employed in the South Africa

How do employers register with the Workmen's Compensation Fund

  • Fill in the compensation fund registration form.
  • Send the form together with your company registration documents and if a sole trader your ID as well. This can be sent via post, fax or email.

How to pay the Workmen's Compensation Fund

After registering, you must pay a yearly fee based on your employees' earnings and the risks involved in their job. There are some employers who do not have to pay assessment fees.

Every April, the Compensation Fund sends a payment notice based on your earnings report. The report is prepared by Workmen's Compensation Fund after you submit your earnings information. The fees could increase, or decrease based on an employer’s accident costs. Employers that have low costs may qualify for assessment fee rebates.

When are Employers required to submit their return of earnings

The deadline to submit your return of earnings is no later than the 31st of March each year. The amount payable is determined by calculating the amount of earnings paid by an employer to the employees. It considers the income the worker is paid from March 1 of the previous year until the end of February of the current year.

How does Workmen’s Compensation work

The fund is a type of insurance, governed by The Compensation for Occupational Injuries and Diseases Act. Workmen's Compensation fund can help employers avoid serious lawsuits. The fund enables the employees to claim for work-related injuries.

In the event of a work-related death, it would pay out to the dependents of the employee.

The amount payable to the fund each year is determined by the amount of salaries paid. The fund pays the employees' medical bills and in the event of death compensation is also paid.

Why must I sign up for Workmen’s Compensation Fund

  • You could avoid becoming bankrupt and losing your business. Any small business owner would agree that sudden medical treatment or claims for death benefits can cause a business to go bankrupt if uninsured. The fund pays compensation to the employee who becomes disabled or dies, saving the business a lot of headache and financial distress.
  • It is required for tenders. If you want to put in a bid for a tender, then these applications usually require a Letter of Good Standing from the fund. To get a Letter of Good standing, employers must register for Workmen's Compensation and keep up with their payments.
  • It is compulsory as mandated by law. The Department of Labour requires any employer with one or more employees to register with the Workmen’s Compensation Fund.

What happens if I don't pay the Workmen's Compensation fund

If your payments are not up to date, then you are not covered. Your responsibility is to reregister your company and pay your annual Workman's Compensation assessment fee.

What happens if my business has more than one branch

You could need more than one registration. Different branches within the same company usually require separate Workmen’s Compensation registrations.

Who is excluded from workers compensation

The following employees aren't covered by the Compensation Fund, as per the Compensation for Occupational Injuries and Diseases Act:

  • workers totally or partially disabled for less than 3 days.
  • domestic workers.
  • persons receiving military training.
  • member of the South African National Defence Force, or the South African Police Service.
  • any worker guilty of willful misconduct, unless they are seriously disabled or killed.
  • anyone employed outside the South Africa for a continuous 12 months or more.
  • workers working mainly worked outside South Africa and only temporarily employed in the South Africa.

Avoid being caught off-guard by sudden medical expenses from a claim. Your employees deserve to be covered by workers compensation. Contact Zeelie Professional Accountants SA today for assistance with your Workmen's Compensation Fund registration.

Do you need a Quote for our Tax and Accounting Services?

Contact our team via any of the following channels to get a proposal for your accounting and tax services:

Subscribe to our newsletters.

Disclaimer: 

The views or opinions expressed on this site are solely those of the original authors and other contributors. The material and information contained on this website is for general information purposes only.

This information is for general purposes only. Don't use this information for making business, legal and tax decisions without consulting a professional.

We do not make any express or implied representation, as to the completeness or accuracy of the information published.

Tax law changes regularly, and any tax information on this site might be outdated.

Links to this website may lead to other websites outside our control and we accept no liability in respect thereof.

ZPA accepts no liability for any loss or damage arising from the use of any material on this site.