Leave: Paid-Forced-Unpaid-Loans and Lockdown

The breaking news that left us frustrated and irritated just before lockdown, 27 March 2020, was “cash in your leave!”. Take leave, even if runs into a deficit! Some of us were told that payment for the initial lockdown is a loan. A loan, without consulting MISA, that must be repaid with three or four months after lockdown. as a loan that we must repay in three months

The genesis of Lockdown

COVID-19 and the results thereof was-and still is- new territory. At the commencement of lockdown guidance in regard to leave ( https://www.misa.org.za/leave-provision-and-alternatives-during-lockdown/ ) was given. There was however no legal obligation on an employer to not ask you to utilise your leave or even to provide that your leave may go in a deficit.

The unintentional effect of leave in a deficit granted in good faith is the burden of a loan and the requirement to repay this loan within a three-month or undetermined period.

Loss of Income relief – TERS Directive – 25 March 2020 to 6 April 2020

The Temporary Employee/Employer Relief Fund was created specifically for loss of income as a result of theCOVID-19 pandemic. Most employers who did claim on behalf of employees did so only when their employees did not receive any salary for the month of April 2020. That begs the question regarding employees who had to utilise leave days, even if their leave was at a deficit.

Good news – TERS Directive – Signed 16 April 2020

The good news is that the TERS Directive has been amended to include the following: “Payment of benefits to Contributors who have lost income or have been required to take annual leave in terms of section 22(10 of the Basic Conditions of Employment Act, 1977 (Act 75 of 1997) due to the COVID-19 pandemic.”

Your rights

Your leave can be credited and the “loan”, if you did agree to those terms, may be reduced!

Your employer has recourse by claiming from TERS on your behalf and credit your leave accordingly which will definitely result in either a reduced “loan” or a smaller deficit with regard to your leave. Remember that the TERS pay-out is on a sliding scale by which at least 38% to 60 percent of your monthly salary will be paid subject to the threshold amount of R17 712 monthly. The benefit received from TERS will thus be between R3 500 and R6 730.

MISA did reach an agreement with the Unemployment Insurance Commissioner and we do submit claims on behalf of employers for all their employees as a measure to assist you as our member.

In a Nutshell: Your leave days can be credited when your employer claims from the TERS benefit on your behalf.

Remember MISA is just a phone call away!