After last year’s controversial legislative programme introducing the regulation of labour broking, the Department of Labour’s planned amendments this year are benign and likely to be welcomed by labour unions.
The department’s chief director, Thembinkosi Mkalipi, said on Thursday that two were in the offing — an improvement in the benefits of the Unemployment Insurance Fund (UIF) and the incorporation of more than 500,000 domestic workers under the Compensation for Occupational Injuries and Diseases Act. He did not provide details about the second amendment.
The bills will come before Parliament this year but are unlikely to create the same furore that greeted last year’s amendments to the Basic Conditions of Employment Act and the Labour Relations Act.
› New mining law changes ‘could deter investors’
› US, eurozone will find printing money is not the answer
UIF commissioner Boas Seruwe said last year that the fund planned to extend the payment of benefits to the unemployed from eight months to 12 months, which will be of great assistance to the millions of people thrown out of work.
The UIF also intended to extend the grace period during which unemployment benefits can first be claimed, to 18 months from six months, Mr Seruwe said.
Mr Mkalipi said both proposed amendments were made possible by the strong financial position of the UIF and the Compensation Fund. Actuaries had determined the funds could afford the costs involved.
By the end of the 2011-12 financial year on March 31, the Compensation Fund had an accumulated surplus of R14,2bn and the UIF an accumulated surplus of R48bn.
The UIF is funded by monthly contributions from employers and employees, amounting to 1 percent of the employee’s monthly remuneration.
Contributions in 2011-12 were R12,4bn. About 1,4-million employers with 7,8-million employees are registered with the fund. The UIF’s net surplus for the year was R11.4bn after paying R5.6bn in claims. The fund generated investment income of R4.2bn.
In the longer term, the UIF would like to raise the ratio of income replacement to salary that it pays to the unemployed to 65 percent from 45 percent.
Mr Mkalipi said the extension of compensation to domestic workers would follow South Africa’s ratification of the International Labour Organisation’s (ILO) international convention on domestic workers which was adopted by the ILO conference in Geneva in 2011. It lays down labour standards for domestic workers and will come into force this year.
He said there could be practical hurdles to overcome in providing cover for domestic workers.
The amendments would also try to make the compensation act more "user friendly". It was an old act, last amended a long time ago, he said.