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UIF & COVID-19 – Revision of the UIF relief scheme provisions

UIF & COVID-19 – Revision of the UIF relief scheme

The Minister of Employment and Labour announced the Unemployment Insurance Fund Temporary Employee/Employer Relief Scheme.

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the convergence of covid-19 with force majeure

On 25 March 2020, the Minister of Employment and Labour announced the Unemployment Insurance Fund (UIF) Temporary Employee/Employer Relief Scheme in response to the impact of COVID-19. The programme is called “C19-TERS”. C19-TERS was well-received by companies but some of the initial requirements were restrictive.

The Minister issued an amendment to the UIF Directive on 8 April 2020 (government gazette number 43216). We discuss the changes to C19-TERS below. Please refer to our previous alert on this topic. The amended UIF Directive: Who qualifies? The original directive issued on 25 March 2020 required that the company close its operations for a period of three (3) months or a lesser period and suffer financial distress.

A very strict interpretation would be for companies to close completely and the directive did not accommodate scenarios where the companies could still run parts of their business operations during the lockdown. The term “financial distress” was also not defined but this requirement has now been removed.

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KPMG International Cooperative (“KPMG International”) is a Swiss entity.  Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm.

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