Government re-opens lockdown financial support for South Africa, with key changes – what you should know

16 July 2021 

Employment and Labour minister, Thulas Nxesi has gazetted a new directive that will make it possible for the Unemployment Insurance Fund (UIF) to implement a third extension of the Covid-19 TERS benefit.

The UIF will open the system for applications from 19 July 2021 and commence payments from 26 July 2021, the department said in a statement on Friday evening.

“However, there is one major condition – that payments will, in the main, be made directly to the bank accounts of workers and not, as has happened before, through their employers – but employers would still be expected to claim on their behalf,” it said.

The department said that this third phase will bring relief for the following categories of workers:

  • Workers who have not been able to work from 16 March 2021, due to level 1,2 and 3 restrictions preventing gatherings of a certain number of people– such as in the entertainment industry;
  • Workers who were and/or are still impacted upon by the Level 4 restrictions which commenced on 28 June 2021;
  • Workers who have not been able to work due to the fact that they are over 60 or have co-morbidities and have not been able to work in the period, as well as those who have/had to isolate or go into quarantine.

The period the direction covers will end on 25 July 2021.

Background and details

The direction follows the announcement by Minister Nxesi three weeks ago that the department intended to extend benefits to sectors affected by Adjusted Alert Level 4 restrictions.

This point was further buttressed when President Cyril Ramaphosa announced to the nation on 11 July 2021 that the UIF had embarked on negotiations with NEDLAC social partners to address the difficulties faced by employees who lost income under level 4 restrictions.

After intense deliberations with social partners at Nedlac, the UIF agreed to open the window for phase 3 of Covid TERS to cover the period between 16 March 2021 to 25 July 2021,

A significant change in the direction is that the UIF will pay employees directly unless otherwise decided at the discretion of the UIF Commissioner.

The application process and the information or documents required are the same as with the previous extensions, except in respect of the processing of payments directly into the employees’ accounts.

“It is, therefore, crucial for employers to provide valid and accurate details of their employees including identity document numbers and valid bank accounts,” said Advocate Mzie Yawa, acting UIF Commissioner.

Whilst paying directly into employees bank account remains the most preferred payment mode, UIF is mindful of instances where this may be difficult.

In such instances and upon provision of sufficient proof by the employer, funds may be paid into the employer’s account at the UIF’s discretion.

“We have learnt the lesson from the previous phases that some unscrupulous employers did not advance the funds to their employees and it is for that reason that we have opted for this mode of payment.

“As a result of the non-payment of workers, the UIF and the entire department were inundated with a lot of complaints as workers could see in the system that funds had been released but had not been paid by their employers who kept the Covid TERS funds for themselves,” said Yawa.

Other operational details will be contained in a letter to be sent directly to employers and the letter together with directives will be available on both the TERS portal and the Employment and Labour website.

Source: Businesstech at