Reference Acts and Websites
Compensation for Occupational Injuries and Diseases Act (1993)
Compensation for Occupational Injuries and Diseases Amendment Act (1997)
What are these two Funds?
The Compensation Fund provides compensation for workers who get hurt at work, or sick from diseases contracted at work, or for death as a result of these injuries or diseases.
The Rand Mutual Assurance Company Limited (RMA) is a non-profit mutual assurance organisation which is owned by its policy holders.
The Compensation Fund (CF) and Rand Mutual Assurance Fund (RMA) both operate in terms of section 30 of the Compensation for Occupational Injuries and Diseases Act, 130 of 1993 as amended, under license from the Minister of Labour.
Who contributes to the Fund?
Employers pay into the Compensation Fund once a year. Workers do not pay anything to the Fund, so employers cannot deduct money from workers’ wages for this.
The following employers do not have to pay into the Fund:
- National and provincial state departments
- Certain local authorities
- Employers insured by a company other than the Compensation Fund. For example, those companies which are part of the Chamber of Mines are insured by Rand Mutual Association, and many employers in the construction industry are insured by Federated Employers Mutual Assurance.
These employers are still covered by the Act and claims are made to and decided by the Commissioner with the difference being that the payouts are made by the insurance fund of the employer (not by the Compensation Fund), and that some of them pay better benefits.
The Funds generate their revenue from levies paid by employers and this consists of annual assessments paid by registered employers on a basis of a percentage or fixed rate of the annual earnings of their employees. The COID Act, however, makes provision for a minimum assessment to ensure the assessment is not less than the administration costs incurred.
An employer should register with the Compensation Fund within seven (7) days after the first employee was employed.
Who MAY NOT claim from these Funds?
- Domestic workers in private households
- Members of the South African National Defence Force and South African Police Services (they have their own fund)
- Outworkers to whom employers give articles to be made up or to wash or clean; they are not working under the control of the employer
- Workers who work outside South Africa for longer than 12 months at a time, unless there is a special agreement with the Commissioner in place
When will the Funds not pay compensation?
- No payment is made for claims which are made more than 12 months after the accident or death, or more than 12 months after the disease is diagnosed.
- If a worker is off work for 3 days or less, this is not covered by the Compensation Fund. It may be covered by the worker’s medical aid or sick fund.
- No payment is made if the worker’s own misconduct caused the accident unless the worker was seriously disabled or died from the accident.
- There may be no payment if the worker unreasonably refuses to have medical treatment, for as long as the worker refuses.
What does the RMA do that the CF does not?
Firstly, the functions of RMA and CF are the same; both funds operate in terms of the Act and must process claims as and when they are lodged. Whereas the Compensation Fund dealt with virtually all industries before, the RMA Fund does not.
The RMA specifically deals with defined industry sectors. In addition to the mining industry, the RMA also started handling claims from “Class XIII Employers” in March 2015 when the Department of Labour promulgated two gazettes (37826 and 38044) thereby transferring them to the RMA Fund.
Class XIII employers are the following industries: iron, steel, artificial limbs, galvanizing, garages, metals, etc. with all the associated products produced by these industries. The list is extensive and it is best to source the info from the Department of Labour as updates are made published so often. Annual updates with fund value benefits are also provided by both Funds.
How are claims lodged?
Reporting of accidents and occupational diseases for both Funds are very similar. Note that online submission of the information is required too; the links have been provided above.
Reporting of Accidents
Submit the Insurer’s prescribed form for reporting accidents and claiming compensation, fully completed, to the Insurer within seven (7) days of becoming aware of an accident to an Employee.
Reporting of Occupational Diseases
In the case of occupational disease, submit the prescribed form for reporting the contracting of an occupational disease and claiming compensation, fully completed, to the Fund within fourteen (14) days of
becoming aware of the Employee’s diagnosis.
NOTE: The Employer declares that the information provided in the prescribed form for reporting accidents or occupational diseases and claiming compensation would be CORRECT in all respects and acknowledge that the Fund would utilise the information contained therein for purposes of adjudicating the Employee’s claim for compensation.
In the event that a compensation is paid as a result of any misrepresentation or incorrect information, the Employer or Employee may be required to repay or return the amount of compensation paid. The Fund shall be entitled to take legal action to recover the compensation paid and any costs involved.
Workers’ compensation is a medically-driven system intended to render injured workers with medical treatment, income protection, permanent loss of function, or organ and fatality benefits.
The term ‘medically-driven’ implies that medical information is used to guide fundamental decisions in the system, including acceptance into the system. Healthcare providers play a major role in treating workers who have sustained an injury or developed a disease; simultaneously, they are obliged to submit medical reports.
A comprehensive occupational health history must include information about all the occupations the worker has held, as well as the duration, specific job tasks, time taken to complete different tasks, hazards to which he or she was exposed, and type of protective equipment that was used.
What types of compensation payment are made?
There are four main types of compensation payments.
- Temporary disability (the worker eventually recovers from the injury or illness)
- Permanent disability (the worker never fully recovers)
- Medical expenses
Compensation is calculated as a percentage of the wage the worker was earning at the time the disease or injury is diagnosed. If the worker is unemployed by the time a disease is diagnosed the wage they would have been earning must be calculated. The Compensation Fund does not pay for pain and suffering, only for loss of movement or use of your body.
The formulae used in these compensation calculations will be described in a separate article.
For further information, please contact us via our website www.fincor.co.za. We also regularly publish articles covering several industry fields.
Author Craig Tonkin