“Therefore, the current benefits under the Unemployment Insurance Act are the only interventions available to cover the affected workers. However, to ensure that some of the basic tenets of the act are not violated, the department is going to draft a special directive dealing with the affected workers in the two provinces,” he said.
The directive is, among other things, expected to make provision for workers who would normally not qualify for these benefits due to non-compliance with the act to be able to access the benefits.
“However, I should emphasise that it will not be a free for all. The criteria to determine who qualifies is going to be very stringent and payments will not be generous. While it is our desire to pay all affected workers, it should be borne in mind that finance is a limited resource,” he said.
The department’s director-general, Thobile Lamati, did not specify how much has been set aside other than say it would come from the R5.3bn which had been allocated to the Unemployment Insurance Fund (UIF) which was announced by President Cyril Ramaphosa as an extension of TERS.
Nxesi said he had since instructed his department to gather information on the affected businesses and perform an analysis of the businesses that will afford to carry their employee’s salaries during this period.
“On the basis of this analysis we shall be able to indicate the benefit calculation that we will follow; whether it is a flat rate across the board, an income replacement rate, or combination of the two — depending on the nature of the application,” he said.
Details pertaining to who will qualify for assistance, payment structure, the application process and the duration of the payment period will be outlined in the direction according to the department.
“We are mindful of the urgency of the matter, therefore we commit to expediting the process of drafting and approval of the directive. The UIF already has a system in place that will help fast-track the payments.”
Though employers were set to play a key role in the application process, Nxesi assured the country that the benefit would be paid directly into the account of the employee. This was to ensure immediate assistance and reduce the risk of possible fraud.
Distressed businesses after the unrest were urged to apply for the normal Temporary Employer/Employee Relief Scheme (TERS) which is aimed at helping companies temporarily in distress, but with a plan in place to turn the business around within 6-12 months. The applications are made through the Commission for Conciliation, Mediation and Arbitration (CCMA).