Business for South Africa (B4SA) is disappointed that all Unemployment Insurance Fund (UIF) Temporary Employer/Employee Relief Scheme (TERS) benefit payments have been halted pending investigations by the Auditor-General (AG).

It is understood that the AG is investigating system integrity problems at the UIF related to the TERS system.

B4SA says organised labour representatives share its disappointment about this development.

B4SA notes that none of the already significantly delayed payments on claims for the July/August period, for which claims opened on August 17, have been made. The catching up on backlog payments going back as far as April has also been halted.

B4SA states that it strongly supports the mitigation of fraud risks and urges that criminal charges be brought against all alleged perpetrators.

However, the organisation says unilateral halting of all payments, and the “very poor communication” of the situation by the UIF leadership, is “grossly unfair” to all employees and their employers who have legitimate claims.

“That the UIF system is incapable of remedying the relatively small number of fraudulent claims without disadvantaging the millions of legitimate claimants is an indictment on the UIF system.”

In this regard, B4SA notes its understanding that, following the investigations and flags raised by the AG, measures have been put in place to mitigate risk and assess and improve data integrity.

However, B4SA also says it remains unclear how long these processes will take to complete and the organisation calls for payments to resume for all active claim periods as soon as possible.

"The continued delays and lack of transparency from the UIF in regard to their capacity challenges has had the unintended consequence of creating mistrust between employers and employees," it states.

B4SA further notes that capacity at the UIF call centre has been radically reduced as of mid-August, which is likely to create additional challenges for the resolution of queries.

With the current delays being experienced, B4SA and, as it understands, organised labour, will insist that the previously nominated closure on September 15 for April and May TERS claims be removed.

“Any future closure date will have to be renegotiated once the social partners are satisfied that employers and beneficiaries are not unfairly prejudiced by the failure of UIF systems and support infrastructure,” states B4SA.

The organisation says it has been urging the UIF for some time to engage meaningful third-party support, and in this regard, has a team of members “lined up to provide assistance on a pro bono basis”.

However, B4SA says that, so far, this offer has not been taken up. “Urgent intervention is required.”

B4SA remains committed to supporting employers and beneficiaries in accessing their TERS benefits and will continue to work with the UIF as far as possible, to identify and resolve operational challenges.