Health and safety laws update October 2016

Compensation Commissioner Vuyo Mafata paid R3b in benefits. However the fund spent R1b 'irregularly'.
Compensation Commissioner Vuyo Mafata paid R3b in benefits. However the fund spent R1b ‘irregularly’.

This health and safety laws update of October 2016, includes Compensation Fund audit results; and the legal status of SADC workers in SA.

Compensation Fund admits to R1-b irregular spending

The Compensation Fund said it spent R1-b irregularly last year, but the auditor-general was not able to confirm this figure, “as the entity did not maintain proper records and adequate systems of internal control”.

The fund also notched up R404m (from R17m the previous year) in fruitless and wasteful expenditure, mainly due to breach of contract with a debt collector who obtained an order of court.

In the notes to the fund’s 2015-2016 annual financial statements tabled in Parliament, the fund disclosed that it received 316 notices of motion and court summonses and, as a result, was exposed to about R310m, lower than the previous year’s R780m exposure.

The auditor-general had to issue a disclaimer on the fund’s financial statements, as there was insufficient appropriate audit evidence to form an audit opinion.

The lack of audit evidence covered a host of matters including revenue and records of benefits. The auditor-general also highlighted a lack of internal controls in the organisation.

This negative finding continues a long trend of adverse audit opinions for the financially chaotic fund, which pays compensation for workers injured at work.

Its failure to pay claims has been a bitter source of complaint by hospitals and the medical profession, not to mention beneficiaries themselves.

Outstanding claims at year-end were valued by actuaries at R12b. The fund, which is financed by contributions from employers, collected R7.6b last year and earned R360m on its investments.

Compensation Commissioner Vuyo Mafata said the fund was improving the payment of benefits. During the year it paid R2b in medical claims, R132m in compensation benefits, and R960m in monthly pensions.

However, the auditor-general noted that the interventions to recruit adequately qualified and skilled people started too late in the financial year to have an effect.

There was also minimal improvement in key controls over the processing of claims, debt collection, compliance with legislation, and the quality of financial statements.

Zambian and Zimbabwean workers protected in SA

Zambia and South Africa have signed a memorandum of understanding (MoU) which seeks to protect the interests of their nationals working in the two countries.

SA had signed a similar memorandum with Zimbabwe. The Zambia-SA memorandum, signed in Cape Town, aims to define the basis for institutional relations under which cooperation would be developed between the two parties in the fields of employment, labour and social security, reports Lusaka Times.

Areas of cooperation will include collective bargaining, dispute resolution systems, and labour inspections.

Press Secretary at the Zambian High Commission in South Africa Nicky Shabolyo said the countries would share some labour market information, occupational health and safety, HIV and AIDS, and Wellness in the workplace.

Shabolyo disclosed that the MoU will include other areas such as international labour cooperation issues, social security issues relating to unemployment insurance and compensation, and productivity issues.

Minister of Labour and Social Security, Fackson Shamenda signed on behalf of the Zambian Government while his counterpart, Ms. Mildred Oliphant, Minister for the Department of Labour signed on behalf of the South African Government.

Zambia’s Acting High Commissioner to South Africa, Ms Philomena Kachesa, South Africa’s Labour Deputy Minister Sango Patekile Holomisa, representatives from Zambia’s National Pension Scheme Authority (NAPSA) and South African Government agencies witnessed the signing ceremony held at Parliament Buildings in Cape Town.

Shamenda said the signing of the MoU enhanced the strategic co-operation and partnership on employment, labour and social security between the two countries to which Zambia was fully committed.

He said there are many South Africans working in Zambia, and Zambian migrant workers in SA.

Compensation fraud accused pleaded ‘Not Guilty’

Dr David Michael Adams (41) alleged to have defrauded the Department of Labour’s Compensation Fund (CF) of R396 660, pleaded not guilty in the Pretoria Magistrates’ Court on 14 September 2016.

Dr Adams is facing 29 counts of contravening Section 6 of the Prevention of Organised Crime Act, and 29 counts of theft.

He is alleged to have received unlawful payments from the Compensation Fund, and was arrested in 2010. During his arrest Dr Adams was running his practice in Lehurutse, North West. He is out on a bail.

Following his not guilty plea, his legal representative read an admission letter before the Court in which Adams admits that on 19 January 2010 he had received an amount of R396 660 from the worker’s Fund.

Adams further stated in his admission statement that the money was processed by the Compensation Fund and paid into his account. The trial continues on 14 November 2016.

The Compensation Fund is a public entity under the administration of Department of Labour. The CF provides cover to workers injured and/or who contract diseases at work.

DMR says incidents rise in winter and spring

Mineral Resources minister Mosebenzi Zwane visited Sibanye Gold’s Driefontein mine in Carletonville in July. He was concerned at the safety performance of the industry since the beginning of the year.

Trends showed that fatalities tend to increase in winter and spring, which required extra vigilance from the state, business and labour.

  • Sources; DOL. PMG. DMR.
  • This post does not constitute any law, or official notice, or legal advice.
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