Domestic Workers were formerly excluded from the Compensation for Occupational Injuries and Diseases Act (“COIDA”).

In Mahlangu and Another v Minister of Labour and Others [2020] ZACC 24 the Constitutional Court confirmed a High Court Order invalidating their exclusion from COIDA. Consequently, domestic workers are now covered by COIDA and their employers are required to register with and contribute towards the fund.

The upshot of registering with COIDA is that employers are indemnified from occupational injuries and diseases suffered by their domestic workers (although they must still take steps to identify hazards and ensure the safety of the workplace in terms of the Occupational Health and Safety Act).

In anticipation of the abovementioned judgment, Government published the Compensation for Occupational Injuries and Diseases Amendment Bill on 27 August 2020. It removes the exclusion for domestic workers and makes provision for payment.

On 10 March 2021, the compensation fund commissioner published information on the inclusion of domestic workers which, amongst other things, sets out what benefits can be claimed, how to register and the assessment rate that applied. Click here to access that document.

Prior to 31 March every year, employers are required to submit a return of earnings or “RoE” statement to the Department of Labour reflecting the total amount paid to their employees (in money and kind) from 31 March the previous year to the end of February in the current year of assessment.

The annual assessment fee payable by employers towards the fund is determined based on the following calculation:

Assessment fee = total annual earnings ÷ 100 x 1.04 (the assessment tariff).

Total annual earnings include benefits such as food allowances, travel allowances, accommodation allowances (or the value of discounted accommodation), the value of employee contributions to any medical aid or provident fund scheme (excluding the employer contributions), guaranteed thirteenth cheques, etc.

Occasional expenses such as intermittent overtime, ex gratia payments, discretionary bonuses and payments for non-recurring tasks are excluded from total earnings.

Furthermore, there is a statutory cap on worker’s pay for the purposes of determining the assessment fee that changes annually (presently R484 200.00).

DETERMINATION OF COMPENSATION FUND CONTRIBUTION – EXAMPLE

Step one:	Determination of total earnings (inclusive of benefits such as food allowances, travel allowances, guaranteed thirteenth cheques and the like)	R60 000.00 (annual wage)   +   R20 000.00 (annual travel allowance)   =   R80 000.00 (total remuneration)
Step two:	Divide total earnings by 100   Total Earnings ÷ 100	R80 000.00   ÷   100   = R800.00
Step three:	Apply assessment tariff to determine amount to be paid to compensation fund   Total Earnings ÷ 100 X 1.04= Contribution Amount payable to fund	R800.00 X 1.04   =   R832.00 (contribution amount)

For a guide on registering new or existing domestic workers with the Compensation Fund and effecting annual assessment fee payments please click to see Chapter 7.