CRS News Flash 20 April 2023 – SOUTH AFRICA – CORRECTION: COIDA ROE Maximum Earnings Threshold

On 20 February 2023 a News Flash was issued by CRS to inform employers of a notice issued by the Director-General of Employment and Labour to announce the maximum earnings amount on actual earnings and the maximum earnings amount on provisional assessment.

The earnings thresholds specified in the aforementioned News Flash were:

·        R529 264 for the period 1 March 2022 to 28 February 2023 (actual earnings); and

·        R563 520 for the period 1 March 2023 to 28 February 2024 (provisional earnings).

On 10 March 2023 Government Gazette No. 48187 was published by the Department of Employment and Labour containing a notice of intention to increase monthly pensions payable in terms of Sections 49 (4) and 54 (1) (a), (b), (c) and (d) of the Compensation of Injuries and Diseases Act (COIDA). These sections relate to benefit payouts and are not payroll-related.

However, what no one noticed at first was that the last page of the aforementioned government gazette contained another notice regarding the maximum amount of earnings on provisional assessment. This threshold differs from the one published on 17 February 2023.

The discrepancy was pointed out by the PAGSA (Payroll Authors Group of South Africa). The PAGSA represents the computerised payroll industry in South Africa. In its role as payroll industry representative, the PAGSA engages with the statutory bodies whose legislation and administration requirements impact employers and payroll systems.

Following discovery of the discrepancy, the PAGSA brought it to the attention of the Department of Employment and Labour (DEL). The DEL has now confirmed the earnings threshold for provisional earnings specified in Government Gazette No. 48187 is the amount to be used.

The two earnings thresholds to be applied in the payroll are as follows:

·        R529 264 for the period 1 March 2022 to 28 February 2023 (actual earnings); and

·        R568 959 for the period 1 March 2023 to 28 February 2024 (provisional earnings).