The COVID-19 pandemic has created unique challenges for employers forced to comply with the lockdown and other control measures. This has caused knock-on human resource issues, some of these include:
• The temporary suspension of payment of contributions
• The temporary absence of members with pay – commonly known as short time
• The temporary absence of members without pay – commonly known as unpaid leave.
The temporary suspension of payment of contributions
The Fund’s Rules do not permit the Trustees to allow a temporary suspension of payment of pension fund contributions. However, legal opinion has been taken and the Trustees are seeking a rule amendment to authorise the temporary suspension of contributions with effect from 1 April 2020 under certain conditions.
The advice provided is that the Trustees can be quite confident of the approval of the rule amendment and, although it might take some time to be formally approved given the closure of the FSCA during the lockdown, employers may submit a motivation on the company letterhead addressing the following elements:
a. Detailed reason/s why the employer is unable to pay contributions. Stating specifically that unless there is such a suspension the majority of the members in its employment will likely face retrenchment.
b. The members employed by that employer have had full disclosure of the need of the employer to suspend contributions without which the majority of those members will probably be retrenched.
c. These members have had an opportunity to object to the employer’s request in terms of applicable labour legislation.
d. The period for which the employer anticipates not being able to pay.
e. Confirm that no deductions towards pension and risk benefits have been made from employees.
f. Confirm that they will contribute to risk and admin fees.
g. Provide all cell numbers and contact details of members to enable the Fund to communicate directly with them.
Employers must remain aware that contributions in respect of March 2020 must, in terms of S13A of the Pension Funds Act, be paid on or before 7 April 2020. No leeway can be considered in this regard.
Temporary absence with pay – short time
The Rules permit a reduction in the contributions paid in line with a reduction in remuneration. Employers are urged to pay the full risk premiums to retain full insured benefits cover.
Temporary absence without pay – unpaid leave
In order to retain the insured benefits cover, employers need to pay the risk premiums and the administration fee. The employer and the member can agree who should be liable to pay the premiums, but the actual payment needs to be made by the employer in the normal manner.
Calculation of insured benefits premiums
This can be calculated as 2.812% of pensionable remuneration (death, disability and administration) plus R22.53 (funeral cover).
The Fund’s operations during lockdown
The Fund’s operations will continue. However, these will be carried out remotely and the two walk-in centres – at No.1 Adderley Street Cape Town and the Metropolitan offices at Parc du Cap – will be closed.
Please submit claims as follows:
• Funeral Claims and Death Claims: email@example.com and copy in Nomakhaya.firstname.lastname@example.org
• Withdrawal Claims and Retirement Claims: Thacsahelpdesk@momentum.co.za
• Disability Claims: email@example.com and copy in firstname.lastname@example.org.
Please note that the helpdesk telephone number 0860 22 22 88 will be operational during the lockdown period.
Just to reiterate the following safety measures during this crisis period:
• Wash your hands frequently using soap and water for at least 20 seconds. Use a hand sanitiser if soap and water are not available.
• Cough or sneeze into a tissue or flexed elbow, then throw the tissue in the garbage.
• Avoid touching your eyes, nose or mouth with unwashed hands.
• Avoid close contact with people who are sick, coughing or sneezing.
• Stay home when you are sick.
• Clean and disinfect surfaces and objects that people frequently touch.
• Stay at home during the lockdown period – midnight on 26 March to midnight 16 April 2020.
Should you have any other queries or concerns please contact Briggett Smit, the Fund Relationship Consultant, on email: email@example.com who will be available during this time to facilitate any queries.