The fund will be a massive state-run medical scheme, and all South Africans will be members.
Most healthcare – including doctors’ visits, medicines, operations and hospital stays – will be free, for everyone.
Instead of paying your monthly membership, you will pay a similar amount of extra tax on your income
But there remain huge reservations about whether government can afford, and manage, its NHI plans.
The National Health Insurance bill was finally introduced last week, and – despite many, many concerns – it looks as if government will be pushing ahead to start implementing the new healthcare regime.
In a nutshell, this is what will happen: medical schemes as we know it will disappear, and your doctor will be paid by government.
Instead of paying your monthly membership, you will pay a similar amount of extra tax on your income. The government will use that money, and some of its health budget, to buy healthcare for all South Africans. That means that even those without medical schemes may be treated by private doctors and in private hospitals.
Most healthcare – including doctors’ visits, medicines, operations and hospital stays – will be free, for everyone.
Government says the aim of the NHI is to help medical scheme members with their high out-of-pocket costs. At the same time, it also acknowledges that state medical staff and hospitals can’t cope with treating the 83% of South Africans who don’t have medical aid.
There is a general acceptance that South African needs national, universal healthcare, says Dr Ernst Marais, COO of ICON Oncology (ICON), which represents more than 80% of oncologists in SA. Currently around 8% of South Africa’s GDP is spent on healthcare, with roughly 50% of that amount going towards the nine million people who are on medical aid, while the other 50% is spent on 51 million people.
“The healthcare system remains unsustainably lopsided.” Also, Marais says, there is an oversupply of private sector hospitals, which can help government treat patients without medical schemes.
But there remain huge reservations about whether government can afford, and manage, its NHI plans.
While the latest bill remains a bit sketchy, here’s what we now know with some certainty:
1. You will become a member of the NHI Fund.
The fund will be a massive state-run medical scheme, and all South Africans will be members – you won’t have a choice.
2. If you earn an income, you will contribute towards the NHI Fund.
Government will levy an extra tax on your personal income, and use the money it will save by not giving you tax credits for being a member of a medical scheme. There may also be a tax levied on your employer. Previously it was speculated that an “NHI tax” of between 3.5% and 5% could be levied on your salary.
3. All contributions will go into a pool.
Government will use your tax money, as well as some of its healthcare budget, to buy services from public and private doctors, specialists, and hospitals that are accredited with the state.
4. The fund will cover a range of medical services, treatments, and procedures.
All of these will be for free, without any co-payments. However, the fund will not cover treatments if it’s not a “medical necessity” and where there isn’t a “cost-effective intervention”. If the fund refuses to pay for a health care, it will issue you a notice of the refusal and give you reasonable opportunity to appeal this decision.
Every year, government will determine what prices will be paid for by specific services.
5. You will probably have to register with a GP who is contracted with the state.
While this was not clearly stated in the bill, it is expected that each contracted GP will have a set number of patients who they will “service” for the NHI Fund. You could be limited to how often you see a GP.
6. There will be strict rules about seeing specialists.
You won’t be able to go directly to a specialist, but will have to get a referral first. A visit to specialists, like paediatricians or gynaecologists, may require longer waiting lists, as all South Africans – including the 83% of the population who are not currently medical scheme members – will now have access to private-sector specialists.
It could also, for example, mean far fewer Caesarean sections in South Africa, as the health system is expected to rely more on non-specialists like midwives. In 2017, some 69% of South African babies were delivered via C-section in private hospitals. (The World Health Organisation advises a maximum of 15%, and in public hospitals, only 26% of births are C-sections.) Also, you may not be able to get easy access to a private hospital that is accredited with the state, given that more people will be admitted.
7. The state will buy medicines for everyone
Instead of the private sector buying medicines for its patients, and the state securing treatments for public-sector patients, government will buy medicines for all patients.
8. Medical schemes may disappear
Marais expects that instead of the current medical schemes, medical insurance will become more common. To ensure that they will still have direct access to a specialist, and no waiting times for treatments, wealthier people will – on top of their NHI contribution every month – probably take out medical insurance.
New specific types of top-up medical insurance– for orthodontics, or for cancer treatment – will probably be created.
9. Foreigners won’t be covered
Adult asylum seeker or illegal foreigner will only get emergency medical services; and “services for notifiable conditions of public health concern”. The children of asylum seekers and illegal foreigners will be entitled to basic health care services.
Foreigners visiting South Africa must have travel insurance to receive health care services through the NHI Fund.
10. You will have access to all your medical records
You will be able to access any information or records relating to your health kept by the fund.
11.The fund will be run by a CEO and a Board
The fund will be managed by a CEO, who will be appointed by the minister of health, and can serve for a maximum of ten years. He will be supported by a board of 11 persons, also appointed by the minister.
Since the Constitutional Court declared the private use of cannabis legal in the matter of Minister of Justice and Constitutional Development and Others v Prince & Others [2018], employers have been required to consider how best to deal with the effects of personal cannabis use in the workplace.
The use of cannabis by employees at home does not necessarily mean employees are entitled to attend the workplace under the influence or to render services with their ability impaired.
The implications of the personal use of cannabis and its impact on the workplace was recently considered by the Commission for Conciliation, Mediation and Arbitration in the case of Mthembu & Others v NCT Durban Wood Chips [2019].
In this case the employer, a company in the wood and chip industry, dismissed several employees for being under the influence of an intoxicating substance after testing positive for cannabis during working hours.
In terms of the employer’s substance abuse policy, the employer had a zero-tolerance approach to the use of intoxicating substances by employees due to the dangerous nature of the industry in which it operated. The employees challenged the fairness of their dismissals on the basis that they had consumed the cannabis at home in their private time and not during working hours.
While noting that the Constitutional Court had recently declared the private use of cannabis legal, the Commissioner held that, akin to alcohol, an employer is entitled to discipline employees who use cannabis or are under its influence during working hours, where there is an inclination that the consumption of cannabis could impair the employee’s ability to work to the standard and care reasonably required by an employer.
The rationale behind the employer’s zero-tolerance approach to substance abuse was consistent with the high degree of danger posed at the workplace in which heavy machinery and dangerous equipment was continually being operated. In the circumstances, the Commissioner held that it would be reasonable for the employer to expect its employees not to be under the influence of cannabis when reporting for duty because of the inherently dangerous working environment. The employees’ dismissals were thus found to be fair.
Not a one-size-fits-all ruling
While the CCMA’s ruling may provide guidance to employers, the decision to dismiss the employees in the present matter was closely aligned to safety considerations associated with individuals working in a dangerous environment, under the influence of intoxicating substances. What about employees who perform desk jobs under the influence of cannabis? Would a zero-tolerance approach to these employees be reasonable in such circumstances? Would these employees pose a threat to the safety of other employees in the workplace?
The debate on how best to deal with the impact of personal cannabis use in the workplace is thus likely to continue.
For the time being, employers should be mindful of the following issues:
One of the difficulties that employers will face when employees use cannabis in their private time is that they will need to show that the employee’s ability to work was impaired or that the employee was under the influence of cannabis while at work. As with alcohol abuse, an employer may discipline an employee who is under the influence of cannabis in circumstances where the employee is unable to perform her or his duties or poses a risk to other employees in the workplace. However, it is possible that an employee may test positive for cannabis even when not under the influence while at the workplace. So, for example, an employee who gets ‘high’ over the weekend may test positive for cannabis on Monday but this does not necessarily mean she or he is under the influence and unable to carry out her or his duties. Accordingly, a more nuanced approach may be required to deal with the use of cannabis than that of alcohol.
A further challenge for employers may be the methods of detecting cannabis. There are a number of ways to test for cannabis, including urine and blood analysis. Unlike alcohol which leaves an individual’s bloodstream within a few hours after consumption, cannabis may remain present in an individual’s system for a number of days. This may mean that a zero-tolerance approach may be unconstitutional as it will result in an employee not being able to use cannabis at home in her or his private time. In addition, tests for cannabis do not demonstrate the degree of impairment of the employee’s ability to perform his or her duties.
In developing any policy or workplace rules addressing the use of cannabis, employers will be required to take into account a wide range of factors. These include the nature of the employer’s business and operations; the employee’s duties and responsibilities; the manner of testing for cannabis in compliance with Section 7 of the Employment Equity Act, 1998; and appropriate action depending on the extent of the impairment to the employee’s ability. Employers will thus be required to take steps to monitor an employee’s behaviour to ascertain whether she or he is showing signs of being under the influence of cannabis on duty.
While the CCMA’s ruling gives guidance, it should not be used as a blanket justification for dismissing employees who test positive for cannabis. Employers should carefully consider how to regulate the use of cannabis in the workplace to best suit the nature of its business and operations and associated risks while respecting an employee’s constitutional right to use cannabis at home.
The National Minimum Wage Act 9 of 2018 (NMWA) came into effect on 1 January 2019, and provides for, amongst others, a national minimum wage; the establishment of a National Minimum Wage Commission; a review and annual adjustment of the national minimum wage; and the provision of an exemption from paying the national minimum wage.
The NMWA applies to all workers and their employers, except members of the South African National Defence Force, the National Intelligence Agency, the South African Secret Service; and volunteers who perform work for another person without remuneration. It applies to any person who works for another and who receives, or is entitled to receive, any payment for that work whether in money or in kind.
What is the national minimum wage?
The national minimum wage is R20 for each ordinary hour worked. There are, however, certain exceptions to the national minimum wage amount of R20 per hour:
Farm workers are entitled to a minimum wage of R18 per hour. A ‘farm worker’ means a worker who is employed mainly or wholly in connection with farming or forestry activities, and includes a domestic worker employed in a home on a farm or forestry environment and a security guard on a farm or other agricultural premises, excluding a security guard employed in the private security industry.
Domestic workers are entitled to a minimum wage of R15 per hour. A ‘domestic worker’ means a worker who performs domestic work in a private household and who received, or is entitled to receive, a wage and includes: a gardener; a person employed by a household as a driver of a motor vehicle; a person who takes care of children, the aged, the sick, the frail or the disabled; and domestic workers employed or supplied by employment services.
Workers employment on an expanded public works programme are entitled to a minimum wage of R11 per hour from a date that will be determined by the President in the Government Gazette. Expanded public works programme means a programme to provide public or community services through a labour intensive programme determined by the Minister and funded from public resources.
Workers who have concluded learnership agreements contemplated in section 17 of the Skills Development Act 97 of 1998 are entitled to the allowances contained in Schedule 2 of the NMWA.
Employer’s should note that, within 18 months of the commencement of the NMWA, being 1 January 2019, the National Minimum Wage Commission, will review the national minimum wage of farm workers and domestic workers, and within two years, determine an adjustment of the applicable national minimum wage. The national minimum wage in respect of workers in the expanded public works programme will be increased proportionately to any adjustment of the national minimum wage.
How is the national minimum wage calculated?
The calculation of the national minimum wage is the amount payable in money for ordinary hours of work. It excludes:
any payment made to enable a worker to work including any transport, equipment, tool, food or accommodation allowance, unless specified otherwise in a sectoral determination;
any payment in kind including board or accommodation, unless specified otherwise in a sectoral determination;
gratuities including bonuses, tips or gifts; and
any other prescribed category of payment.
‘Ordinary hours of work’ means the hours of work permitted in terms of section 9 of the Basic Conditions of Employment Act 75 of 1997 (BCEA) (currently 45 hours per week) or in terms of any agreement in terms of section 11 or 12 of the BCEA. A worker is entitled to receive the national minimum wage for the number of hours that the worker works on any day. An employee or worker who works for less than four hours on any day must be paid for four hours on that day. This is applicable to employees or workers who earn less than the earnings threshold set by the Minister over time, presently being R205,433.30. If the worker is paid on a basis other than the number of hours worked, the worker may not be paid less than the national minimum wage for the ordinary hours of work.
Any deduction made from the remuneration of a worker must be in accordance with section 34 of the BCEA, provided that the deduction made in terms of section 34(1)(a) of the BCEA does not exceed one quarter of a worker’s remuneration.
Does a worker have a right to the national minimum wage?
Every worker will be entitled to payment of a wage not less than the national minimum wage. Employers will be obligated to pay workers this wage. The payment of the national minimum wage cannot be waived and overrides any contrary provision in a contract, collective agreement, sectoral determination or law.
Must a worker’s contract of employment be amended in light of the NMWA?
The national minimum wage must constitute a term of the worker’s contract, unless the contract, collective agreement or law provides for a more favourable wage. Employers should thus, where applicable, amend their contracts of employment to make reference to the national minimum wage. An employer should note further that a unilateral change of wages, hours of work or other conditions of employment in connection with the implementation of the national minimum wage will be regarded as an unfair labour practice.
When does the provisions of the NMWA come into effect?
The NMWA will came into operation on 1 January 2019. Section 4(6) of the NMWA, which prohibits the payment of the national minimum wage being waived and further provides that the national minimum wage takes precedence over any contrary provision in any contract, collective agreement, sectoral determination or law, operates with retrospective effect from 1 May 2017.
Can an employer be exempt from paying the national minimum wage?
An employer or employer’s organisation registered in terms of section 96 of the Labour Relations Act 66 of 1995 (LRA), or any other law, acting on behalf of a member, may apply for exemption from paying the national minimum wage. The exemption may not be granted for longer than one year and must specify the wage that the employer is required to pay workers. The exemption process provided for in the regulations to the NMWA must be complied with when doing so.
An employer or a registered employer’s organisation may assist its members to apply to the delegated authority, for an exemption from paying the national minimum wage.
The application must be lodged on the National Minimum Wage Exemption System.
An exemption may only be granted if the delegated authority is satisfied that the employer cannot afford to pay the minimum wage, and every representative trade union has been meaningfully consulted or if there is no such trade union, the affected workers have been meaningfully consulted. The consultation process requires the employer to provide the other parties with a copy of the exemption application to be lodged on the online system.
The determination of whether an employer can afford to pay the minimum wage must be in accordance with the Commercial, Household, or Non-Profit Organisations Financial Decision Process outlined in Schedule 1 of the Regulations to the NMWA.
The delegated authority may grant an exemption from paying the national minimum wage only from the date of the application for the exemption. The exemption must specify the period for which it is granted, which may not be more than 12 months.
The delegated authority must specify the wage that the employer is required to pay workers, which may not be less than 90% of the national minimum wage.
The delegated authority may grant an exemption on any condition that advances the purposes of the NMWA.
An employer exempted from paying the national minimum wage must display a copy of the exemption notice conspicuously at the workplace where it can be read by all employees to whom the exemption applies. Further, a copy of the exemption notice must be given to the representative trade union, every worker who requests a copy, and the bargaining council.
Any affected person may apply to the delegated authority for the withdrawal of an exemption notice by lodging an application on the online system in the prescribed format. Before the delegated authority makes the decision to withdraw an exemption notice, the delegated authority must also be satisfied that the employer has been consulted, and the representative trade union or affected workers have been given access to the application lodged.
If an exemption notice is withdrawn, the delegated authority must issue a notice of withdrawal on the Exemption System.
What is the role and responsibility of the National Minimum Wage Commission?
A National Minimum Wage Commission is established by the NMWA. The Commission must review the national minimum wage annually and make recommendations to the Minister on any adjustment of the national minimum wage. The recommendations must consider: inflation, the cost of living and the need to retain the value of the minimum wage; wage levels and collective bargaining outcomes; gross domestic product; productivity; ability of employers to carry on their businesses successfully; the operation of small, medium or micro-enterprises and new enterprises; the likely impact of the recommended adjustment on employment or the creation of employment; and any other relevant factor.
The President on Friday made the announcement that the national minimum wage would come into effect on 1 January 2019.
“We have gathered here to declare that from the 1st of January 2019, no worker may be paid below the national minimum wage,” he told those attending the ceremony in Kliptown, Soweto.
Work on the national minimum wage this was so as to fulfil the 1955 Congress of the People declaration made in 1955 that there would be a minimum wage for all workers.
South Africa said President Ramaphosa had now gathered at the venue where the declaration was made more than six decades later, to fulfil that promise.
“This is a great achievement for the working people of South Africa, who have had to endure generations of exploitation.”
“It is a great achievement for the labour movement, which has placed this fundamental demand at the centre of its struggle for better conditions for workers,” said the President who founded the National Union of Mineworkers (NUM) with James Motlatsi and Elijah Barayi in 80s and became the union’s first General Secretary.
He added that the minimum wage – which is currently set at R20 an hour – should also be seen as an achievement for business as it demonstrates the commitment of employers to fairer wages and better working conditions.
The coming into effect of the minimum wage is also an achievement for young democracy like South Africa which is striving to overcome a legacy of poverty and severe inequality.
The ceremony was also seen as the culmination of several years of intense deliberations among the social partners.
The President’s comments were echoed by Business Unity South Africa (BUSA) chief executive officer Tanya Cohen who said the Ekurhuleni Declaration of 4 November 2014, highlighted the importance of the minimum wage.
She said the minimum wage of R20 an hour translating to R3,500 a month is a South African crafted product uniquely designed for the country’s circumstances and needs.
She said the proclamation of the minimum wage is a step in the right direction for the South African economy.
“Rating agencies have consistently said to us that they want to see a stable labour market environment which goes hand in hand with a solid and growing economy. The fact that we’ve signed off on the minimum wage, it’s really regarded as credit positive,” she said.
The design of the minimum wage took into consideration the context and difficulties that different types of business whether large or small face as well their ability to afford the minimum wage.
Meanwhile, Cosatu President Zingiswa Losi said organized labour welcomes the minimum wage, saying it is a historic achievement for workers.
“The minimum wage and labour acts are historic achievements for workers. They are a result of decades of struggle by workers, the national minimum wage will see the wages of 6.4 million of the most vulnerable workers including retail, and other impoverished workers rising. This is equal to 47% of workers, in simple terms half the nation will benefit from this directly,” she said, adding that it will effect a massive economic stimulus for the local economy.
The minimum wage would put more money into workers pockets at a time when workers are facing a 1% VAT increase (to 15%) as well as rising price increases coupled with increasing levels of unemployment and retrenchments, she said.
“We look forward to see laws come into effect,” said Losi who also urged government to act without fear or favour against employers who pay workers below the minimum wage.
She said labour would push for the introduction of a living wage.
President Ramaphosa said the national minimum wage does not stand alone and that it’s part of a broader engagement among social partners on how to reduce wage inequality and promote labour stability in South Africa.
“We have heard the voices of those who say the starting minimum wage level of R20 an hour is too low. We agree. It is far below what we would want workers to earn,” he said.
He added that it was a starting level as evidence showed that it would not lead to widespread layoffs.
Labour Minister Mildred Oliphant said the minimum wage will not replace the minimum wages that have already been agreed to, through the collective bargaining agreements.
“The national minimum wage will replace only the minimum wage in the sector if that minimum wage is less than the national minimum wage that should be clear,” she stressed, adding that there are people who will benefit from the wage.
“They will benefit, particularly those who are still earning far less than the proposed R20 an hour, there is a sector that will benefit immensely being the hospitality industry, where you find that workers are only earning through tips,” she said.
Employers that comply and implement employment equity (EE) will be issued with a certificate of compliance valid for 12 months subject to fulfilling a number of conditions.
The Department of Labour says these certificates will be issued subject to fulfilment of specified conditions for big employers/designated employers such as meeting any sectoral targets in terms of section 15A that applies to it or has provided reasonable grounds in terms of legislation justifying its failure to comply.
They will be issued if they have not been found by the CCMA or a court within the previous twelve months to have – breached the prohibition on unfair discrimination; or failed to pay the national minimum wage in terms of the law; have submitted a report in terms of Section 21, and comply with Chapter II on the prohibition of unfair discrimination.
For small or non-designated employers, the department said they will be issued if they comply with chapter II on the prohibition of unfair discrimination and National Minimum Wage Act, 2017.
This emerged on Wednesday during the Department of Labour’s roadshow on the national public hearings on the EE Amendment Bill & Regulations held at the Olive Convention Centre in Durban.
Speaking at the hearings, the department’s Deputy Director Masilo Lefika said as part of monitoring mechanisms, the department would link its systems with the CCMA, the Department of Trade and Industry and the National Treasury to enforce compliance.
The department has published the Employment Equity Amendment Bill and the Draft Employment Equity Regulations in the Government Gazette in response to the slow pace of transformation in the workplaces.
As such, the department is using the public hearings to gather comments to the amendments.
The key objectives of the EE amendments are the introduction of provisions and regulatory requirements for the promulgation of Section 53 to ensure employers benefiting financially from state contracts comply with the EE Act.
The amendments also aim to bring alignment between definitions, policy provisions and the administration systems and enhancing of the collection of data for the National Minimum Wage Commission as well as to make reporting requirements easier for designated employers who are small employers.
Furthermore, the amendments want to see the introduction of provisions in the EE Amendment Bill and regulations for the consultation and setting of numerically based sector targets across various occupational levels to ensure an equitably represented workforce.
Lefika said the Employment Equity Act has walked a long journey since it was enacted in 1998.
He said when the Commission for Employment Equity paused and reviewed progress it found out that the implementation of transformation was moving at a snail pace.
“It is clear that there is no transformation in the workplaces. We do acknowledge, however, that there are pockets of excellence demonstrated by other employers when it comes to implementing transformation in the labour market,” he said.
Lefika said another amendment in the EE Bill was that the psychological testing and other similar assessments have been repealed.
Another set of public hearings on EE amendments & Regulations will be held on Friday at Horseshoe Inn 101 Memorial Road in Kimberley, Northern Cape and at Orion Hotel – Donkerhoek Street in Rustenburg, North West Province starting at 8.30am to 2pm.
The public hearings are open to employers or heads of organisations, academics, assigned senior managers, consultative EE forum members, human resource practitioners, trade unions representatives and employees.
The public hearings end on 26 October 2018 in Johannesburg, Gauteng Province. Comments to the amendments will be accepted until 20 November.
You have an annual payroll of more than R500 000 and pay 1% of your annual payroll towards the Skills Development Levy (SDL) for the sake of being compliant. You know your staff need to be up-skilled, but neither you, nor your overworked management team have the time or energy to figure out what SDL’s are all about.
And once you’re finally done ensuring you are compliant with your Workplace Skills Plan (WSP) and Annual Training Report (ATR) – where do you even start looking for the right service provider for your training needs
And what exactly happens to the 1% that you pay over towards the SDL?
One of the services offered by FforMan is the use of external Skills Development Facilitators (SDF’s) to assist companies with exactly this process and we offer bespoke training solutions to fill the skills gaps that have been identified!
Why should you use an external SDF? Firstly, cost – you don’t need to employ another permanent staff member.
Fforman’s SDF’s do WSP’s and ATR’s for a living!
When you appoint an SDF, you only get invoiced for the time the facilitator spends working with your company. Fforman’s SDF’s are able to do them in a fraction of the time it would take a business owner or an HR manager who only works with this once a year. Failure to submit your WSP and ATR will result in a zero score on skills development as this is a strict requirement for the new B-BBEE codes.
SDF’s keep up to date with all the changes in the Seta’s, know all the terminology, have the right contacts and have long-standing relationships with Seta’s.
They also keep themselves updated with the discretionary funding opportunities from the Seta’s – Discretional and Pivotal Funding gets allocated the largest part of the SDL funds.
Should you have more than 50 employees, you are required to create a Skills Development Committee that can be chaired by an internal or external SDF. This committee identifies skills requirements that are evidenced through the provision of meetings and skills audits.
Does your HR Manager have your Skills Development needs under control?Life happens. Employees get sick, they retire and they resign. You can still appoint a secondary SDF to double check your compliance and to be ready to step up, should your HR manager or internal SDF not be able to act when they are needed to.
So what happens to your 1% contribution?20% is allocated to the National Skills Fund (NSF) and 80% to the different Seta’s. The Seta’s break their 80% down to – 10.5% Seta administrational allowance, 0.5% to QCTO for quality assurance, 20% for Mandatory Grants and 49% for Pivotal Grants (which are split into 80% Pivotal Funding and 20% Discretional Funding).
The NSF supports skills development projects that don’t fall under the Seta’s. The fund enables the state to meet training needs of the unemployed, non-levy paying cooperatives, NGO’s, community structures and vulnerable groups. In 2015/2016 fifteen thousand students benefited from the R1 billion in scholarships and bursaries from the NSF.
Appointing an SDF will not only ensure that you are compliant, but, your staff will also be able to get the training they – and your company – deserve.
As Henry Ford said – “The only thing worse than training your employees and having them leave, is not training them and having them stay.”
Don’t hesitate to give us a call, if we can be of any assistance on 031-7653611 or Mat Fforde on 083 357 8390.
