3.2 Compensation Fund Amendment Act
Aspects of the COID Bill (Compensation for Occupational Injuries and Diseases Amendment Bill) have been added to this workbook to bring this section up to date as at the time of writing (September 2023).
In addition, a section has been added towards the end that discusses the calculation by payrolls of ‘COID earnings’ up to the ‘Maximum Earnings’ threshold published by the Minister of Employment and Labour.
Background
My ‘Big Picture’ view of the COID Act is that it can be split into two main areas of administration:
1. ‘Front-end’: The annual ROE (Return of Earnings), and assessment
2. ‘Back-end’: Claims for occupational injuries and diseases, payment of medical suppliers, employees, etc.
Payrolls and employers must comply with the front-end requirements, while employers, employees, and medical providers must comply with the back-end requirements.
COID Amendment Process
The COID Bill (Compensation for Occupational Injuries and Diseases Amendment Bill) was first issued on 18 October 2018, and after a lengthy process over years of public comment, NEDLAC, internal discussions, etc. an amended COID Bill was published on 27 August 2020 in Gazette No. 43658.
Three years later, the State President has signed the final COID Bill thereby promulgating it, and the COID Amendment Act was then issued in Gazette No. 48431 on 17 April 2023.
However, at the time of writing (early September 2023), an effective date for the implementation of the COID Amendment Act had not yet been published. This means that employers must continue as normal and comply with the requirements of the current COID Act as it was prior to the COID amendments.
The following News release (dated 6 April 2023) was published on the Government website on 14 April 2023 and gives an overview of the COID Amendment Act.
President Cyril Ramaphosa has signed into law the Compensation for Occupational Injuries and Diseases Amendment Bill, which extends coverage for occupational injuries and diseases to previously excluded vulnerable workers and improves compensation benefits to employees.
The Bill effects a range of amendments to the Compensation for Occupational Injuries and Diseases Act (Act No 130 of 1993) which governs compensation for disablement caused by occupational injuries or diseases sustained or contracted by employees, or for death resulting from injuries or diseases.
The new provisions enacted by the President include one that gives effect to a Constitutional Court judgment in the matter of Mahlangu and Another v Minister of Labour and Others in which the Court declared parts of the Compensation for Occupational Injuries and Diseases Act unconstitutional.
The unconstitutionality related to the exclusion of domestic workers employed in private households from the definition of “employee” and the effective denial of compensation to such workers who contracted diseases or suffered disablement, injuries, or death in the course of their employment.
The amended legislation also protects the livelihoods of workers affected by occupational injuries or diseases by introducing a multi-disciplinary employee-based process of rehabilitation and reintegration of injured employees or employees who contracted occupational diseases.
This requires employers to exhaust all rehabilitation and reintegration processes before laying off an employee.
In turn, employers will be incentivised for full compliance with the provisions.
The new law also addresses institutional arrangements, such as the appointment of members of the Compensation Board.
Structure of the COID Act
My ‘big picture’ view of the COID Act is that it focuses on two areas of administration, namely the:
1. ‘Front-end’: The annual ROE (Return of Earnings), and assessment
2. ‘Back-end’: Claims for occupational injuries and diseases, payment of medical suppliers, employees, etc.
Payrolls and employers must comply with the ‘front-end’ requirements (where the money goes into the Fund), while employers, employees, and medical providers must comply with the back-end requirements (where the money flows out of the Fund).
The summary of the COID Amendment Act that follows focuses on the proposed amendments to the ‘front-end’ requirements, but in the section directly below, it briefly mentions an important change to the ‘back-end’ requirements, that of rehabilitation.
COID Amendment Act – Expands Rehabilitation Provisions
The provisions in the current COID Act that provide for the rehabilitation of employees who have been injured or contracted a disease while on duty, are apparently outdated, inefficient, expensive to administer, and result in delays of payments to medical service providers.
The COID Amendment Act provides comprehensively for ‘rehabilitation’ of occupationally injured employees, but while this is important, this workbook does not go into the details as this falls into ‘back-end’ administration and does not impact on payroll systems.
The following is a summary of the main aspects of rehabilitation that are now provided for:
• A new chapter on orthotics and vocational rehabilitation has been added to the COID Act
• Section 56: Increased compensation if the employer is negligent
• Section 73: Medical expenses – third parties are excluded?
In addition, the Fund has recently introduced a Vocational Rehabilitation, Re- integration and Return-to-Work programme that offers:
• Training and upskilling of occupationally injured employees for identified positions
• Bursaries and short skills programmes for injured workers if they want to reskill or upskill themselves to return back to work
• Incubation programmes so that they can start their own businesses and become self-sufficient.
“What we are asking is for employers to exhaust all rehabilitation and reintegration processes before laying off an employee.”
Modernisation of this aspect of the COID Act is long overdue and will hopefully result in significant improvements.
COID Amendment Act – Domestic workers
The COID Act currently defines an employee to be:
“… a person who has entered into or works under a contract of service or of apprenticeship or learnership, with an employer, whether the contract is express or implied, oral or in writing, and whether the remuneration is calculated by time or by work done, or is in cash or in kind, and includes—
(a) a casual employee employed for the purpose of the employer’s business; …”
The definition goes on to include other categories of employees that are not important for this discussion, and then excludes:
“(v) a domestic employee employed as such in a private household;”
The COID Amendment Act (once it is in operation) will delete the above clause (v) that currently excludes domestic employees from the definition of an employee. This means that from the effective date, domestic workers will be included as employees because they will no longer be excluded.
Domestic workers will then be entitled to the same benefits under the COID Act as other (commercial) employees.
It is interesting to note that the concept of a ‘domestic employee’ is only referred to in the wording of the exclusion that is planned to be deleted.
Domestic employees are not defined in the COID Act as they are in the BCEA and in the two Unemployment Insurance Acts. After the exclusion is deleted, there will no longer be any reference in the COID Act to a domestic employee – they get no special recognition in the Act at all.
They will be employees just like any other (commercial) employee.
This means, for example, that in the event of the death of a domestic worker, the dependants of the deceased worker are entitled to claim a benefit.
Incidentally, the final COID Bill widened the definition of a “dependant” by adding life partners, and a person who was married to the employee according to civil law, civil union, customary law, or any other marriage recognised in terms of any other law.
This has been supported by the ConCourt judgement (see section below).
‘Casual’ Domestic Workers
Note the ‘casual’ workers are defined to be employees, therefore a domestic worker who works on a ‘casual’ basis is an employee by definition.
The COID Act does not have a ‘less than 24 hours pm’ exclusion of employees as there is in the Unemployment Insurance Contributions Act.
For example, this means that a householder who employs a gardener once per week for a morning only (5 hours x 4 weeks = 20 hours; 5 hours x 5 weeks = 25 hours), must declare and pay the Compensation Fund for this individual.
Domestic Employers
Note that it is not necessary to change the definition of an ‘employer’ to include a ‘domestic employer’ because the current definition in the COID Act is already wide enough to include them:
‘‘‘employer’ means any person or legal person, including the State, who employs an employee, …”
This definition means that the householder who employs a domestic worker is a (domestic) employer because the domestic worker is a (domestic) employee.
At this stage, we can only assume that domestic employers (householders) will have to submit an annual Return of Earnings in the same manner as commercial employers are required to do, and that they will be assessed on the earnings declared in the ROE in the same manner as commercial employers.
ConCourt Judgement – Earlier Domestic worker claims
As discussed above, for many years domestic workers have been excluded from the protection of the Compensation Fund against occupational injuries and diseases.
In a judgment handed down in November 2020, the Constitutional Court declared a section of the COID Act unconstitutional to the extent that it excludes domestic workers employed at households from the definition of ’employee’, preventing them from being able to receive compensation for illness or injury (or death) incurred at work.
The dependants of these employees were also not able to claim if their breadwinner sustained a fatal accident at work.
The ConCourt order applies retrospectively, and covers illness, injury, and death at the workplace.
To support the ConCourt order, the COID Bill added a new section headed “Transitional Arrangements” that states that domestic employers and domestic workers must submit a claim within three years after the effective date of the COID Amendment Act if they want to claim for any injury, disease, or death that occurred before the promulgation date of the COID Amendment Act.

 
Domestic Employer Registration
According to section 4 of a notice issued in Gazette No. 44250 on 10 March 2021, the ConCourt ruling on domestic employees:
“means that all employers of domestic employees are obliged to register as employers with the Compensation Fund and submit the necessary returns as obliged by the Compensation for Occupational Injuries and Diseases Act 130 of 1993 (COIDA). All employers of domestic workers are therefore encouraged to register with the Compensation Fund without delay.”
In my opinion, before the COID Amendment Act is made effective, registration is voluntary, and this notice was simply an appeal to domestic employers to register.
Until the COID Amendment Act that removes the current exclusion of domestic employees from the COID Act is made effective, domestic employees are excluded from the current COID Act, and there can be no such thing as a COID domestic employer if there is no such thing as a COID domestic employee.
COID Amendment Act – ‘Earnings’ replaced by ‘Remuneration’
The concept of “earnings” that payrolls and employers must understand and comply with has been a problem for many, many, many … years (see the COID Earnings – Interpretation Issues section below for an explanation).
In a late but very important change to the COID Amendment Bill, the current definition of “earnings” was proposed to be replaced by the Fourth Schedule definition of “remuneration”, and this change is confirmed in the COID Amendment Act.
This is such an important change that I have included the actual wording from the COID Amendment Act, something that I don’t normally do in order to keep the workbook as simple as possible.

‘‘‘earnings’ means the remuneration [of an employee at the time of the accident or commencement of an occupational disease as calculated in terms of this Act] as defined in paragraph 1 of the Fourth Schedule to the Income Tax Act, 1962 (Act No. 58 of 1962), but does not include any amount paid or payable to an employee—
(a) by way of any pension, superannuation allowance or retiring allowance; and
(b) which constitutes an amount contemplated in paragraphs (a), (cA), (d), (e) or (eA) of the definition of ‘‘gross income’’ in section 1 of the Income Tax Act, 1962;’’

The wording in ‘bold’ between square brackets [] will be deleted from the current definition, and the wording from “as defined” until the end of the definition has been added.
This proposed definition of remuneration for the COID Act is exactly the same as the definition of remuneration in the Unemployment Insurance Contributions Act with one exception – ‘commission’ is excluded from the remuneration used to calculate the UI contribution, but (correctly in my view) commission is not excluded from the proposed definition for Compensation Fund purposes.
Could this be an indication that the unfair exclusion of commission from remuneration will be removed from the Unemployment Insurance Contributions Act at some stage in the future? The PAGSA has been asking for this to happen for nearly twenty years … so we can but hope.
Once this change is made effective, life will be much easier for all parties – payroll suppliers, employers, and the relevant statutory body – because the various definitions of remuneration will be closely aligned to one another for the following employment taxes:
• PAYE
• Skills Development levies
• Unemployment Insurance contributions
• Compensation Fund
• Employment Tax Incentive (that is until the change effective from 1 March 2022).
Of the legislation that the PAGSA supports, only the BCEA and the Employment Equity Act will have different definitions of remuneration.
Standardisation of the concept of remuneration is of huge value to all parties as it results in better understanding, simpler administration, less mistakes, and improved compliance.
And of course, this opens the door for the future consolidation of the systems that administer employer payments to some statutory bodies … unlikely, but it makes sense.
Lastly, and just for interest’s sake, about 8 years ago I presented a proposal to the Fund on behalf of the PAGSA to motivate the replacement of the concept of ‘earnings’ with that of the Fourth Schedule definition of remuneration.
I hoped that something would come of this proposal in future years, but now that it has actually happened, I don’t think that it is as a result of the presentation – I think that there are other reasons.
COID Earnings – Interpretation Issues
For many years, different opinions have been expressed on the concept of “earnings” that employers and payrolls must apply for the annual Return of Earnings report (the ‘ROE’ or ‘W.As 8’) annual return. Different opinions create uncertainty, resulting in unnecessary calls to the call centres of PAGSA members and the Fund.
The provisions in the current COID Act (i.e. prior to the COID Amendment Bill discussed above) that refer to “earnings” are summarised below.
Currently, the Compensation Fund makes use of the concept of “earnings” for two purposes:
1. To calculate the value of the compensation at the time of the accident or illness
2. To calculate the employer’s annual assessment value from the ROE.
The calculation of the compensation benefit value is not important for payroll administration, but the concept of earnings used for the ROE results in the assessed amount that the employer must pay and is therefore very important for employers (and the Fund’s income).
It must be correctly understood and compliantly applied by employers in their payroll systems.
The COID Act currently defines “earnings” to be:
“… the remuneration of an employee at the time of the accident or the commencement of the occupational disease as calculated in terms of this Act”.
Remuneration is not defined by the COID Act, but it must be “calculated in terms of this Act”.
Section 60 then instructs the Director General to calculate the earnings of an employee “at the time of the accident” in order to determine the compensation value in such manner as in his opinion is best. This section then provides some guidelines to assist the determination of the earnings value for the calculation of the compensation amount from these earnings.
Section 63 deals with the calculation of earnings but is of no help to payrolls.
It appears to be clear from the above wording that the purpose of the current definition, section 60 and section 63 is to provide for the calculation of the compensation benefit “at the time of the accident or … the occupational disease”.
From this follows that the COID Act does not define earnings specifically for the purposes of the Return of Earnings, nor does the Act make any provision for the concept of earnings for assessment purposes.
This vacuum in the legislation resulted in the Fund, after consulting with and acting on advice from the PAGSA in the mid-nineties, creating an interpretation of earnings for the purposes of the ROE.
This interpretation, unchanged since then, is printed at the end of the Return of Earnings form that employers must complete annually and is the only guidance on the concept of earnings for ROE and assessment purposes that is available to payrolls and employers.
However, some aspects of this interpretation have been overtaken by time and should be revisited to align them with current remuneration principles and practices.
For example, the concept of a ‘package’ in the nineties was substantially different from that of ‘cost to company’ today, and a travel allowance is always difficult to value and to administer in practice.
COID Amendment Act – Inspection, Compliance & Enforcement
To improve compliance the Compensation Fund announced its intention in June 2018 to appoint payroll auditors to improve controls in its enforcement systems.
Vusi Maluleke, deputy director: Employer Assessment for large accounts at the Fund, spoke some time ago of the training sessions that are being held across the country focusing on teaching employers how to register online and how to submit the annual Return of Earnings (ROE) online.
Maluleke said that over 300 000 companies failed to submit their Return of Earnings in the past three years. This is an alarming statistic.
COID Regulation Gazette No. 44409 on 1 April 2021: Correction of Regulation published 3 December 2020
On 3 December 2020, the Minister of Employment and Labour published a regulation in Gazette No. 43959 that amongst other matters, explained that the year in which the ending month falls, indicates the year of assessment.
For example: The 2021 year of assessment is the year starting 1 March 2020 and ending 28 February 2021.
This is the same naming principle as in the tax world, but unfortunately this standardisation was short-lived.
The Department corrected their earlier decision in Gazette No. 44409 of 1 April 2020 (‘yes’, on April Fool’s day) and clarified that the year in which the starting month falls, indicates the year of assessment.
For example: the 2022 assessment year is the year starting 1st March 2022 and ending 28th February 2023.
Those of us in the tax world who are used to the naming principle that the year of assessment is indicated by the year in which the ending month falls, will simply have to remember that the naming principle in the world of labour is different.
Assessment Classes
The Regulation specifies 13 x main assessment classes from ‘A’ to ‘M’, and within each of the main classes, a range of sub-classes (identified by a 4-digit code) that each employer registered with the Fund is allocated to.
The rates (a percentage) for each sub-class and for each year from 2021 (i.e. from 1 March 2021) to 2025 (up to 28 February 2026) are listed in a table in the notice. These rates multiplied by the total earnings declared each year by the employer in the annual Return of Earnings submission, result in the amount assessed by the Fund.
The assessed amount represents the employer’s expense of insuring itself against the risk of its employees suffering an occupational injury or disease while on duty, and this expense is of course the Compensation Fund’s income.
Domestic employers have been added under Class M (the 13th class) as sub-class 2500 and their assessment rate is ‘1,04’ from 2021 up to and including 2025.
To give the domestic employer rating some context, here are some examples of other industry ratings:
1. Coal Mining: ‘1,41’ for 2021, decreasing to ‘0,65’ for 2025 [Sub class = 0411]
2. Open cast Mining: ‘1,16’ for 2021, decreasing to ‘0,81’ for 2025 [Sub class = 0420]
3. Domestic employers: ‘1,04’ for 2021, unchanged to ‘1,04’ for 2025 [Sub class = 2500]
4. Municipal Service: ‘0,70’ for 2021, increasing to ‘0,81’ for 2025 [Sub class = 1800]
5. Breweries: ‘0,57’ for 2021, decreasing to ‘0,51’ for 2025 [Sub class = 0641]
6. Beauty and Hair Salons: ‘0,12’ for 2021, increasing to ‘0,18’ for 2025 [Sub class = 1920]
It is interesting to note that in some cases, the percentages have been reduced in the transition from 2020 to 2021.
Effective Date of the Regulation
The new assessment classes and the rates are effective from the 2021 year of assessment (1 March 2021)
Note that in my opinion, domestic employers must only register once the COID Amendment Bill is made effective, but they can do so voluntarily before then.
*** PAGSA members can refer to Newsflash 2021-20
3.3 Compensation Fund ‘Maximum Earnings’ Calculation
Up to now, the Compensation Fund has not provided guidance to employers and payroll systems on how to calculate earnings up to the earnings threshold despite being requested to do so by the PAGSA in years gone by.
Both Gazette No. 48337, issued on 30 March 2023, and Gazette No. 48673 issued on 30 May 2023, included a section with a notice that is headed “Explanatory Notes on the 2022 ROE Season”.
As explained above, in the Fund’s latest terminology decision, ‘2022’ refers to the year in which March falls, not the year in which February falls, as is the case with tax terminology conventions. The “2022 ROE Season” wording in the “Explanatory Notes” notice was therefore referring to the 2022/2023 year of assessment that by the time the two Gazettes were issued, had ended on 28 February 2023.
‘Maximum Earnings’ Calculation Guidance
Amongst other matters, the “Explanatory Notes on the 2022 ROE Season” notice included a ‘Maximum Earnings’ section that states as follows.
A Maximum Earnings is applied annually at the end of the assessment period (28 February 2023) to the individual employee’s annual total earnings, not per month.
Full annual maximum earnings of R529 264.00 will apply irrespective of the number of months the employee was employed in the 2022 ROE Season.
Examples:
a) If an employee has earned total annual earnings of R600 000.00 from the employer during the period as stated above, the amount should be capped at R529 264.00 and be declared as such.
b) If an employee has earned total annual earnings of any amount below R529 264.00, the total annual earnings that must be declared is the total annual earnings amount as earned by the employee, regardless of whether the said employee worked for a full year or a part of the year.
To the best of my knowledge, this ‘Maximum Earnings’ section was published in the two Gazettes without any discussion with, or notification to, any employment organisation.
There was certainly no discussion with, or notice given to, the PAGSA, who after all has as its members the payroll supplier companies that must apply this calculation across the country for all employers in their payroll systems.
Matters Arising from the Notice of ‘Maximum Earnings’
‘Annual’ vs ‘Average’ Calculation of Earnings up to the Maximum Earnings
There are two methods that payrolls can use to calculate earnings of an employee up to the maximum earnings:
1. ‘Average per month’ calculation:
The ‘average per month’ method divides the annual threshold by 12 and limits an employee’s earnings in each month to the average limit per month.
OR
2. ‘Annual cumulative’ calculation:
The ‘annual’ calculation method is described in the ‘Maximum Earnings’ notice in the section directly above. From 1st March, each employee’s earnings are accumulated per month until the annual threshold is reached, and the accumulation stops.
Each of the two methods has pros and cons, and I have no strong feelings in favour of any one of the two methods, as long as casual employees, workers provided by a labour broker, and seasonal workers are adequately protected against occupational injuries and diseases.
The issue is that there must clarity on which of the two methods of calculation must be used.
See the ‘Steps Taken by the PAGSA’ below for more on this matter.
Effective Date
The “Explanatory Notes” notice does not specifically state an effective date, but the heading refers to ‘2022’, and in its wording, the calculation clearly refers to the year of assessment that had just ended (28 February 2023) as well as specifying the annual earnings threshold for the 2022/2023 year (R529 264).
This wording creates the impression that this calculation method must only be used for the 2022/2023 year of assessment and not for future years, which creates uncertainty for payroll suppliers.
Discussed in the previous section, once it is made effective, the COID Amendment Act will replace the concept of ‘earnings’ with the Fourth Schedule definition of remuneration (with some exclusions).
The reference in the notice to only the 2022/2023 year of assessment might be because the Fund intends in future to issue a new ‘Maximum Earnings’ calculation of remuneration (rather than earnings) from the effective date of the COID Amendment Act.
Number of Employees
Besides the fact that the notice was published too late for payroll suppliers to apply the specified calculation of ‘Maximum Earnings’ for the 2022/2023 year of assessment in their payroll systems, it did not specify how the ‘Number of Employees’ must be calculated.
Employers must complete the ‘Number of Employees’ field per month on the annual Return of Earnings form, therefore payrolls must calculate these totals for the year of assessment to assist the employer to complete and submit the ROE accurately.
If an employee works every month of the year of assessment for the same employer, the number of months that this employee works for the employer is an easy calculation. It follows that calculating the total number of such employees per month for the employer for the ROE form is also an easy matter.
However, it is not clear how to report the number of months for employees who did not work the full year of assessment for the same employer.
In particular, the calculation is not an easy one for what we refer to as ‘broken periods of employment’, being the working periods of casual workers, seasonal workers, and workers provided by a Temporary Employment Service (TES) to a client-employer, who don’t provide services every month to an employer.
The PAGSA has queried the calculation of the number of employees with the Fund by submitting examples of different methods of counting the number of months of those employees who did not work every month during the year of assessment for the same employer and asked for clarification of this calculation.
Audits of the 2022/2023 Return of Earnings
By the closing of the year of assessment on 28 February 2023, payrolls had already calculated earnings up to the earnings threshold of R529 264 for 2022/2023.
This was done well before the two Gazettes were issued at the end of March and May 2023 respectively.
Soon after the publication of Gazette No. 48673 on 30 May 2023, the PAGSA received reports from our members that an external company, presumably appointed by the fund, was auditing employers, and raising penalties and interest on calculations of the ‘Maximum Earnings’ in respect of the 2022/2023 year of assessment that were not aligned with the ‘Maximum Earnings’ calculation method specified in the Gazettes published at the end of March and May respectively.
In our opinion, this was not only unfair but incorrect in law.
Our concerns were brough to the Fund’s attention but there has been no response, which is unusual.
State Law Advisers – Legal Opinion
Fairly recently, the PAGSA was sent a copy of a legal opinion by the State Law Advisers by a third party (i.e., not by the Fund). Until then we were not aware of its existence, and as far as I am aware, it was never issued in the public domain.
This opinion is dated 4 April 2019, and supports the method of calculating the ‘Maximum Earnings’ that has now been published in the two Gazettes.
From this, I can only assume that at some stage after 4 April 2019, the Fund agreed with this opinion and decided to publish its recommendation at the end of March and May 2023 respectively to provide retrospective guidance for the calculation of ‘Maximum Earnings’ for the 2022/2023 year of assessment that had already ended.
Steps Taken by the PAGSA
Queries on the Implementation of the ‘Maximum Earnings’ Calculation
The PAGSA has sent many emails to the fund to try and get clarity.
We have queried the implementation of the ‘Maximum Earnings’ calculation several times, pointing out the impossibility of payrolls applying a specified calculation to a year of assessment that has already ended.
We have also requested that any penalties and interest that have been raised are reversed.
Joint Approach
The lack of response from the Fund resulted in the PAGSA joining forces with other organisations to jointly approach the Compensation Fund and the DoEL.
This process is ongoing, and is focusing on:
1. Determining the legal status of the “EXPLANATORY NOTES ON THE 2022 ROE SEASON” notice
2. Questioning whether the intention that the ‘Maximum Earnings’ calculation that is specified in the notice must be applied for the 2022/2023 year of assessment is reasonable in practical administration terms.
3. Determining whether or not the ‘Maximum Earnings’ calculation as specified in the notice must be applied for the 2023/2024 year of assessment and for future years of assessment.
4. Clarification of the calculation of the ‘Number of Employees’ that must be reported on the ROE form if an employee does not work every month of the year of assessment for the same employer.
5. Requesting that the penalties and interest that have already been raised in respect of the 2022/2023 year of assessment are retracted and that the audits are stopped.
PAGSA Guidance to ‘Maximum Earnings’
Based on the experience of the recent past, I don’t expect a speedy resolution to the above issues, so the question is how to proceed.
My personal guidance:
1. If penalties and interest have been raised for the 2022/2023 year of assessment because the calculation used was not aligned with the ‘Maximum Earnings’ calculation as now specified in the Gazettes, consider appealing this action, and if justifiable, approaching the courts.
Any reasonable person should agree that one cannot implement a requirement at a certain point in time if the requirement was not known at that time.
2. Consider applying the ‘Maximum Earnings’ calculation as specified in the two Gazettes for the 2023/2024 year of assessment in your payroll system.
3. The next step will be to establish what calculation must be used for the 2024/2025 year of assessment.
In my opinion, it is clear that the Fund want an ‘annual’, as opposed to a ‘monthly’, calculation of ‘Maximum Earnings’ to be applied.
If my opinion is correct, we can then assume that this ‘annual’ calculation principle will be retained when we move away from the concept of ‘earnings’ to the Fourth Schedule definition of ‘remuneration’ when the COID Amendment Act is made effective at some stage in the future.
To repeat, this is my personal guidance, and you would be wise to seek other advice in addition to mine.
[For more information refer to the PAGSA Newsflash 2023-28 published on 16 August 2023]