Labour Minister says employers withholding UIF support will face consequences

Employment and Labour Minister Thulas Nxesi condemns unscrupulous employers for not passing UIF benefits onto employees.

The Department of Employment and Labour has become aware of employers who have received support from the Unemployment Insurance Fund (UIF) but are not passing on the money to their workers. Employment and Labour Minister Thulas Nxesi said the department had been inundated with calls from beneficiaries of the Covid-19 Temporary Employer/Employee Relief Scheme, complaining that their employers had not paid them their benefits despite having received funds from the UIF.

He said the practice was not only callous and insensitive to the needs of workers, but also that the department would come down hard on employers who were cheating their employees out of financial support at a time when so many people were facing financial distress due to the lockdown.

In a media statement, he said the UIF system had been upgraded to allow employees to check the status of claims submitted by their employers. It allows employees to access their employers’ records by entering their ID number to see how much has been paid to the company and the specific amount due to them as employees.

"I want to categorically state that this is inhumane and employers who are withholding funds meant for workers must immediately release payments. We are in the midst of a global pandemic that has brought economies of countries to their knees. Workers are the worst affected by this inevitable eventuality. The worst thing you can do as an employer is to withhold funds meant for workers," said Minister Nxesi.

"We have companies that are misrepresenting us before their workers and the public. For instance, we were accused by a company in the Eastern Cape Unibisco when their workers demanded their money that we have not paid them. Nothing could be further from the truth. Our records indicate that this company was paid a total of R539,595 on April 24 to pass on to their workers."  

The call for companies to pass on the benefits to workers comes as the UIF has disbursed close to R11 billion for the benefit of more than 1.9 million employees. Meanwhile, other payments had been effected through the bargaining councils for over 56,000 employees.