DOL- PRESENTATION TO DOHSCIENTIFIC WORKSHOP ON RISK ASSESSMENT
SUNNYSIDE PARK HOTEL 31 JULY 2013
Overview of the presentation • • • • • • • • • •
Compensation Fund in South Africa Governance of the Fund Mission of the Fund Revenue generation COIDA Benefits Guiding principles Objections Rehabilitation and re-integration Proposed social security reforms Challenges
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THE COMPENSATION FUND • Social insurance within the social security system in South Africa • Administered under the Compensation for Occupational Injuries and Diseases Act, 130 of 1993, as amended in 1997 (COIDA) • It is a schedule 3 Public Entity i.t.o the Public Finance Management Act- in the Department of Labour • Minister is Executive Authority • The Director-General is the Accounting officer • The Compensation Commissioner (DDG) reports to the DG
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Governance of the Compensation FundCompensation Board • The Compensation Board is an advisory body • The CF Board consists of organised business, organised labour, government and medical fraternity • The Board advises Minister of Labour on policy matters, amendments to the Act, annual increases in benefits, appointment of assessors • Director-General (DG) may request the board to investigate any issue relating to the operations of COIDA • The Compensation Commissioner is delegated by the DG to administer COIDA
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Mission To compensate employees for disablement
caused by occupational injuries/diseases sustained/contracted in the course of their employment or their dependents for death resulting from such injuries/diseases and to pay the reasonable medical expenses incurred.
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The Revenue of the Compensation Fund • All employers must register with the Compensation Fund, over 400 000 active at present • The revenue of the Compensation Fund consists mainly of annual assessments paid by the registered employers on the basis of a percentage of the annual earnings of their employees. This rate is fixed per industry subclass • Levies calculated based on the earnings (salaries) submitted by employers multiplied by standard rate per subclass • The Act makes provision for a minimum assessment to ensure that the assessment is not less than the administration costs • Employers pay direct into CF accounts • Employers are obliged to pay within prescribed time frames (30 days of invoice date), which qualifies them for Letters of Good standing
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Revenue Conti… Definition: “any person, including the State, who employs an employee……” State is exempted from paying assessments however, they pay administration costs Obligations of employers: • Register as an employer • Keep record of employee’s earnings • Furnish annual Return of Earnings • Pay annual Assessment • Report all alleged accidents/Occupational diseases on duty • Furnish all requested outstanding documents/information. Failure to comply: penalties
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MUTUAL ASSOCIATIONS Rand Mutual Assurance Company Ltd – mining industry.
Federated Employers Mutual Assurance Company Ltd – construction and building industry. Operates under license from the Minister of Labour Permission is given for employers to register/transfer to mutual associations
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High level business process Revenue generation process Register employer
Issue invoice
Issue return of earnings
Receive return of earnings
Assess employer
Employer pays
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COIDA BENEFITS Benefits are paid to employees, employers (refunds), dependents, medical providers Definition: “Employee is any person who has entered into or works under a contract of service with an employer. The contract of service can be in writing or oral, expressed or implied. Temporary/casual workers, employed for the purpose of the business– covered. Domestic workers in a private householdNOT covered (will be with amendments)
Benefits are for both occupational injuries and diseases
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Temporary Total Disablement (TTD) 75% x(minimum/maximum salary) Section 47(3)(a) Employer liable for payment of compensation for the first 3 months. After 3 months – Fund pays employee until he is declared fit
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Permanent Disablement (PD): Up to 30% - lump sum-15 x (minimum/maximum salary) 1 – 29% - calculated proportionally 100% Pension 75% x (minimum/maximum salary) 31-99% PD: 75% x (minimum/maximum salary) calculated proportionally Payable for life Increased annually based on CPI
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Widow/er: Lump sum Min/max salary x 75% x 40% (more than one widow/er, they share) 2 x monthly pension the deceased employee would have Monthly Pension
Children Monthly pension 20% x 75% x (min/max salary) Until 18 years old Extended – secondary or tertiary education Maximum : 60% (three cildren)
W.Ac. 22 – life certificate to be submitted annually Also increased annually
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• Burial expenses 2012 – R13 716.00 2013 – R14 539.00
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Assistive devices Need for such medical aid is determined by the CF • Chronic medication • Constant Assistance Allowance
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MEDICAL BENEFITS •
Employee has free choice of doctor
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Doctor determines nature and extent of treatment
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Compensation Fund pays reasonable medical aid related to injuries sustained for a maximum of two years
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Need for, nature and sufficiency of medical aid decided by the Compensation Fund
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High level business process Claims processes Register claim
Adjudicate
Assess compensation payable
Calculate award
Employee objects
Review
Hearing
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Main guiding principles of COIDA
No fault
• No damage are recovered by employees against employers • Employees covered even for willful misconduct if serious injuries resulted in death • Employee can claim from employer if the accident was due to employer’s negligence
workrelatedness
• All injuries or diseases must be caused by employment • COIDA is the exclusive remedy for occupational injuries/diseases in SA unlike in N. Zealand; Switzerland, Netherlands etc. • Similar to Germany, USA; Canada; Israel and others
Risk based to improve OHS standards
• Employers are rated according to their risk profiles • Incentive for employers to improve occupational health and safety standards • Compliance by employers to OHS results in less accidents
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Objections to Decisions taken by the Commissioner • • • •
Any person affected may lodge an objection Should use prescribed form WG 29 Lodge objection within 180 days of date of decision Objection heard by Presiding officer and two assessors-one representing employees and one representing employers • If dispute is medical, a medical assessor sits in • COIDA tribunal decisions are appealable to the Supreme court having jurisdiction
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Rehabilitation, Re-Integration and Return to Work Policy Framework Currently, the CF is working on Rehabilitation, Re-integration and Early Return to Work policy. PROGRESS • The policy framework has been developed • The amendment of the current COID Act is underway to make provision for the policy on rehabilitation, a chapter has been added • A policy is being developed to support the new chapter in the Act
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Social Security Reforms • Compensation Fund, thus DoL, is a member of the Inter Departmental Task Team (IDTT) on social security reforms in the country • CF has given inputs to RABSA and NHI • COIDA amendments is also meant to accommodate these reforms • There are benefits in ensuring alignment of entities dealing with social security
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COIDA Key challenges • • • • • • • •
Fragmented compensation systems –ODMWA and COIDA Under-reporting of accidents/ diseases/ or delays Inadequate enforcement of COIDA Centralised system- no direct examination of patients Over servicing by some health care providers Exorbitant medical costs Exploitation of injured employees receiving assistive devices Portability of compensation benefits for non-citizens is still a challenge
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COIDA STATISTICS AS IN 2010 • • • • •
Registers an average of 210 000 to 220 000 per annum Paid R1.8 billion for medical expenses Paid a total of 329 091 benefits worth R801m Had 430 000 employers in the database R29 billion in assets for 2010 financial year
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Industries with highest number of compensation claims • • • • • • •
Air and transport- 50 018 compensation claimsAgriculture and forestry- 24 774 claims Iron; Steel and metal- 41 346 Building and construction- 24 865 claims Food drinks and tobacco- 17 239 Personal services and Hotel- 21 667 claims Trade and Commerce- 31 107 claims
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Thank you
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