Labour Department allocates more funds to assist struggling businesses

Businesses that were on the verge of retrenching their employees as a result of struggling to stay afloat amid the Covid-19 pandemic will now get relief through a strengthened Employer/ Employee Relief Scheme (Ters).

Employment and labour minister Thulas Nxesi revealed this when he tabled the department’s budget vote to a mini plenary of the National Assembly on Friday morning.

Nxesi says relief will be given to struggling businesses as the department gets reconfigured to save and create jobs.

“As part of the reconfiguration of the Department to give effect to the additional employment mandate, the Labour Activation Programmes, funded by the UIF, were refocused to contribute directly to job creation and preservation,” explains Nxesi.

Nxesi said the Unemployment Insurance Fund (UIF) would strengthen the normal Ters to give relief to struggling businesses to save jobs.

“Typically, businesses that have notified the Commission for Conciliation, Mediation and Arbitration (CCMA) of their intention to retrench, would then be invited to apply for support from the UIF normal Ters, and where approved referred to Productivity SA to develop sustainable business strategies.

“From 2020/21, the UIF has invested R104 million to assist distressed businesses,”

The minister says the CCMA recorded an unprecedented number of referrals of Section 189A (retrenchment) matters.

He says the allocation of funds to help struggling businesses comes in handy, as it will save about 58,000 that were at risk of being lost.

The Covid-19 pandemic has seen businesses close doors, retrenchments and salary cuts.

Government created a R500 billion-relief fund to cushion businesses so that they can keep employees instead of showing them the door.

Under the fund, a Temporary Employee Relief Scheme (Ters) was initiated to assist businesses to foot salary bills.

The Covid-19 Ters benefit, which started paying out from April 2020, has, as at 31 March 2021, made payments to 267 000 employers and to 5.4 million individual employees at a cost of R 58.7 billion.

Power FM – 14 May 2021 – Ntsako Mashaba