Why and what must I pay?

Why and what must I pay?

Many employers know this feeling – small amounts of money that needs to be paid for this and that regarding their employees, adds up to a lot. Even if you feel the employee does not deserve that compensation. Unfortunately, these payments are demanded by legislation and employers are obligated to compy.

This article takes a closer look at all the small payments employers are making to their employees. If you are looking for a comprehensive “cheat sheet” on your employer-duties, here it is.

Unemployments Insurance Fund (UIF)

Employers always try to dodge these contributions, but the mere fact that you appointed an employee on a ‘casual’ basis will not suffice. A casual worker is an employee that you need for a once-off odd job that will not take more than 24 hours per month and whose position cannot be regarded as permanent in nature. Any employee that works more than 24 hours per month, must be registered for UIF. This will include registering your business and employees under the Compensation for Occupational Injuries and Diseases Act. Both of the latter contributions are the more important aspects some employers try to avoid, but has to contribute to.



Usually in the beginning of the year there are a few cases where employees do not report for duty when business reopened for the new year. No work, no pay will apply in this regard unless a medical note was given where a medical practitioner booked the employee off, and only if such employee still has paid sick leave days left.


Sick Leave

If the employee has not put in any leave for a particular day or has not provided an excuse of illness or medical certificate, you simply don’t need to pay them for services not rendered. You also don’t need to pay an employee who has been absent from work without good reason for 2 days or longer without providing a medical note as proof of his absence. If the employee is ill for the third time in an 8 week cycle and does not provide you with a medical note, you also don’t need to pay the employee for services not rendered.



Suspension in anticipation of a hearing, must always be paid. Suspension can only be unpaid if the chairperson has incorporated it as part of his sanction after a hearing was held, but this is seldom used. Paid suspension must be uplifted when the suspension is extended due to the fault of the employee. The latter must be confirmed in writing to the employee as soon as the error occurred or else you will still be required to continue payment.


Damages due to Negligence

Any negligent act by an employee that cost the company damages, can only be deducted once a proper agreement has been entered into by both yourself and your employee. This agreement is known as an Acknowledgment of Debt and no deductions of more than 25% of the employee’s gross salary may be deducted. Without an agreement, no deductions may be made. Employees seldom agree to such agreements and SEESA always advises to take the necessary disciplinary action when you have proof against the employee to charge him of same.


Notice pay

What happens if your employee resigns with immediate effect? You simply pay the employee his salary until date of resignation, the employee’s accrued annual leave until date of resignation and any benefits such as provident fund until date of resignation and nothing more. The mere fact that the employee did not work his contractual notice period, unfortunately affords you no right to deduct his notice pay from his salary. If services were rendered, payment must be received and as mentioned above, cannot be deducted without prior agreement.


If required statutory payments are not made, the effect can be CCMA awards, Department of Labour Compliance Orders or worse yet, back payments from your registered Bargaining Council. Knowledge is power and if you know how to pay and when to pay, it can save you a lot of time and effort.



Charlotte Potgieter obtained her LLB degree from UNISA. She is now obtaining her LLM degree in Labour Law and is currently a SEESA Labour Senior Legal Advisor working with the SEESA Labour Call Centre at the Pretoria Head Office.









Leave a reply

Your email address will not be published. Required fields are marked *