COID Registration

What are the Main Advantages of COIDA Registration?

• Compensation Fund Claims
• Return of Earnings
• Letter of Good Standing from COID

Why does all Companies need COIDA Registration?

What is the COIDA Registration Online Process?

What are the Employer Advantages?

What are the Employee Advantages?

What is the Mission of COIDA?

What is an Assessment?

Who in South Africa must register with the Compensation Fund?

Letter of Good Standing Info:

In this post, I will discuss everything you need to know about Workmans Compensation Fund or COIDA Registration in South Africa. It will explain what kind of businesses need to register with COIDA, how COIDA relates to Tenders in South Africa and also what the fastest route is to get full COIDA Registration.

This post is for you if you’re an employer with one or more employee. This post is specifically for you if you need to register with COIDA to obtain your Letter of Good Standing to apply for and win Tenders. However, this post is also for you if you simply have general questions about COIDA, Workmans Compensation Fund and what it is all about.

We often work with South African employers, entrepreneurs and business who have a range of questions regarding Workmans Compensation Fund, COID Registration, the COIDA legislation and how it all relates to getting a Letter of Good Standing. That’s why we’re answering thirteen of these frequently asked questions below relating to Workmens Compensation Fund Registration and COIDA online registration.

Expert Tip: Save time by calling us to get your Compensation Fund Registration.

COIDA (or just COID) is an acronym for the Compensation for Occupational Injuries and Diseases Act. This Act is a piece of South African legislation that helps employers take care of their employees.

This Act makes sure there’s some financial compensation or medical expense coverage available for employees in the case of any injuries or diseases sustained at or during work. It also provides compensation in the cause of work-related death. This financial aid is called the Workman’s Compensation Fund.

It’s good to note that the law was amended in 1997 to be more relevant to today’s business environment. In 1997 the law was officially changed from the “Workmen’s Compensation Act (Act No. 30 of 1941)” to the current “Compensation for Occupational Injuries and Diseases Act (Act 130 of 1993)”.

If you’re a South African employer, this Act most likely (there are a few very limited exceptions) forces you to register for Workman’s Compensation (or COIDA) in order to financially contribute to the Workman’s Compensation Fund.

This fund is a form of insurance that helps you compensate your employers reasonably in the case of work-related injuries, diseases or death.

If you’re an employee, this Act ensures that you are eligible for compensation or medical expense assistance if you ever fall ill or are injured in a work-related accident. It also makes provision for compensation to your dependents in the case of work-related death.

If your business has not yet commenced trading but you need the workmen’s compensation fund registration for a contract, you can submit provisional earnings figures to serve as a placeholder until your actual earnings become available. For instance, if you anticipate a revenue of R200,000, you can use this as your provisional estimate for COIDA assessment purposes.

The Compensation Fund is a fund that administrates the financial contributions of South African employers and the claims by South African employees or their dependents regarding work-related deaths, injuries or diseases.

This fund forces employers to make provision to financially compensate their employees (or their dependents) in the case of any work-related incidents that cause death, harm or illness to their employees.

Almost all South African Employers are required by law to contribute to it. In turn, the fund offers financial assistance and/or compensation for occupational injuries, diseases or deaths to employees or their dependents.

The Compensation Fund is administered by the Compensation Commissioner who approves the claims.

Most South African Employers have to register for COIDA.

If you employ one or more part- or full-time employees you have to register with the Compensation Fund (COIDA). You have to register with the Commissioner at the Compensation Fund within the first 7 days of employing your first employee. If you’re unsure, rather start the COIDA Registration process to find out whether you should than neglecting to do so.

Most South African Employers have to register for COIDA.

If you employ one or more part- or full-time employees you have to register with the Compensation Fund (COIDA). You have to register with the Commissioner at the Compensation Fund within the first 7 days of employing your first employee. If you’re unsure, rather start the COIDA Registration process to find out whether you should than neglecting to do so.

To start the coid registration online, you need to complete the compensation fund registration process. This involves submitting a completed application form along with the required documents to the Compensation Fund.

You have to submit a W.As.2 Form along with certified copies of the IDs of all the owners of your business. If you’re the only business owner, only your ID is required.

If you’ve already registered your company, you have to submit a certified copy of your Company Registration Certificate along with your form too.

We can assist with your Department of Labour COIDA Online Registration as well as Company Registration – contact us toll free on 0800 007 269

A Validation Error arises when the information you have provided about on your Company CIPC registration does not match the records maintained by the Compensation Fund. This often happens when there have been recent changes to your company details, such as a change to the list of directors.

A manual branch submission is necessary under two circumstances:

• • If your Validation Errors remain unresolved after the initial 14-working-day period we mentioned in the previous question.
  • If the industry is not listed among those eligible for online registration. For example, if you operate in a niche industry like renewable energy, manual submission may be required.

A branch submission is typically processed within 14 working days. However, if there are any delays, it is advisable to follow up with the Compensation Fund to ensure timely resolution and maintain compliance with COIDA regulations. Our Experts visit the Department of Labour at least once a week to follow up on branch submissions.

Annual assessment fees/tariffs are the yearly fees any employer has to contribute to the Compensation Fund based on the earnings of his or her employees. This annual amount is also influenced by the type of work these employees do.

Certain professions have a higher risk of occupational injury, death or harm, so the annual contributions will be higher for high-risk versus low-risk employees.

Every year the total cost of the employee-salaries will be reviewed – along with the professions to determine a fair contribution the employer needs to submit to the fund to safeguards his or her employees.

Yes, COIDA assessment fees are subject to annual adjustments based on business categories and risk classes. This means that businesses in higher-risk industries, such as construction, may face different fee changes compared to those in lower-risk industries, such as retail.

Every year on the 31^st of March, employers (this includes contractors) are required to submit a Return of Earnings stating the total wage/salary expenditure between March of the former year and February.

The fund then reviews the Return of Earnings and stipulates the amount payable in a Notice of Assessment.

That means you’ll be paying annual assessment fees to the Workman’s Compensation Fund.

The amount payable to the Compensation Fund is called the assessment fee. Do you have to pay the full amount or can you divide it into instalments? Here are the rules:

• You have to make your first payment to the Compensation Fund within 30 days after getting the Notice of Assessment (you get this notice after registering with the fund, submitting your Return of Earnings – your total wage expenses).
• Then,  pay at least 20% before asking to pay the rest of the payable amount in monthly instalments.
• If you miss a payment, the full amount is due immediately thereafter.

We can assist with your COIDA assessments – contact us toll free on 0800 007 269.

There are a few things that could happen depending on how and why you don’t pay the Compensation Fund as an employer. Here they are (plus they’re correlating legislation):

• Submitting your ROE late: you’ll get a penalty – (Sect 83(2) – 10%)
• Not submitting your ROE at all: you will still get an estimated payment that’s based on an estimate – (Sect 83(6)(a)
• Not paying your assessment: you’ll get a penalty (Sect 87(1) – 10%)
  • You’ll also pay interest on your assessment late payments according to the prevailing prime rate
• Reporting incidents late: you’ll get a penalty
• Not being registered at the Compensation Fund: you’ll get a penalty as soon as an employee, or his or her dependents, claims for an accident/death – (Sect 87(2)(a))
  • In this case, if you don’t provide a fair provision for your employee, or his or her dependents, in the case of a work-related incident you’ll be guilty an offence – Sect 81(3)

All Contractors and Sub-Contractors have to register with the Compensation Fund (COIDA). They also have to pay assessment fees as determined by the Fund.

If the main contractor doesn’t comply with COIDA, a sub-contractor will be fully responsible for any claims from the subcontractor’s employees. That’s why contractors often require a Letter of Good Standing. A Letter of Good Standing is proof that you have no outstanding payments to the Compensation Fund.

A Letter of Good Standing is an official letter that proves you’re registered and up-to-date with your payments with the Compensation Fund or COIDA. 

The reason why Tenders and Contracts so often require you to have a COIDA Letter of Good Standing is simply to make sure you’re taking full responsibility of your employees and to make sure you’re authorized to operate legally.

If you’re not registered or you’re not in good standing with the Compensation Fund, your employees aren’t covered by the Compensation Fund in the case of any work-related accidents in terms of medical expenses or compensation in the case of permanent injury or death.

We can assist with a Letter of Good Standing from COIDA – contact us toll free on 0800 007 269.

Here are the prerequisites, as an employer or business owner, to getting a Letter of Good Standing – and the correlating legislation. You have to be:

• Registered with the Compensation Fund – section 80 of the COID Act.
• Up-to-date with your Return of Earnings submissions – section 82 0f the COID Act.
• Fully assessed by the Compensation Fund in terms of your payable amount – section 83 of the COID Act.
• Up-to-date with your due payments – section 86 of the COID Act.
  • If you have an instalment arrangement to pay your assessment fee on a month‐to‐month basis, you can only receive a Letter of Good Standing that’s valid and renewable on a month‐to‐month basis.

We can assist with a Letter of Good Standing from COIDA – contact us toll free on 0800 007 269.

Once an employee, or his or her dependents, has submitted a claim to the Compensation Fund the Commissioner will assess the case and determine fair compensation.

The amount of compensation will largely depend on the following factors:

• The employee’s income before the incident
• The nature of the injury
• Whether the person is the breadwinner of his or her family.

If an employee stopped working before the diagnosis of a disease, the Commissioner will use the salary before the employee stopped working as a reference.

Click here for assistance with your Compensation Fund Claim.

Medical expenses

If you were harmed or contracted a disease in a work-related situation, you can claim up to 2 years’ worth of medical expenses from the Workman’s Compensation Fund. You can either date this from the accident or the diagnosis of your disease.

Temporary disability

If you can’t work due to a work-related injury or disease, you can claim compensation for the lack of an income for up to 1 year. It can be extended to 2 years or permanent disability (see below) if the Commissioner approves it.

You can also claim your medical costs. When you’re unable to work or can’t do all your work because of an injury or disease.

All medical expenses are also paid if the medical accounts are submitted to the Commissioner.

Permanent disability

If you were hurt or fell ill in such a way that permanently impairs your ability to work in the same way you could before, or stops you from ever working again, you can claim compensation for it.

You will receive a monthly pension (the amount will be determined by your income prior to your incident and your disability) if your disability is more than 30%.

If you still have a disability, but it impairs you less than 30% you could be awarded a once-off total sum as compensation.

Death benefits

Death, induced by a work-related incident, means the dependents of that employee can claim for funeral expenses. Dependents include the spouse of the deceased and the children (under the age of 18) of the deceased – this includes adopted children, step-children and illegitimate children.

If the deceased is the main provider for a family, the family can also claim compensation.

The Compensation Fund mandates RMA (Rand Mutual Assurance) for specific industries to ensure tailored risk coverage. For instance, mining companies are typically subjected to RMA due to the higher occupational hazards associated with this industry.

Yes, each of your business branches must be registered separately for workers compensation to account for the specific operational risks associated with their respective locations. For example, a branch located in athe CDB of Cape Town may face different risk factors than one situated in a quiet coastal town.

Here are some additional tips for COIDA Registration which we elieve will be helpful:

1. Start the registration process early to avoid any delays in obtaining your Letter of Good Standing.
2. Gather all necessary documents and information before starting the registration process.
3. Keep accurate records of your COIDA registration and payments.
4. Contact the Compensation Fund directly or your designated consultant if you have any questions or concerns.

You can view our COIDA Online Registration brochure here.

FEM is a private organisation that has been licensed to provide services under the COID Act. All Companies or employers registered under Class V in terms of the industry classifications of the COID Act, can apply for a FEM Registration.

By registering with FEM, you comply with the legal requirement and ensure your employees are financially protected in case of work-related accidents, injuries, or occupational diseases as per the Compensation for Occupational Injuries and Diseases Act (COID Act).