The Minister of Employment and Labour, Mr Thulas Nxesi, has told the joint meeting of the Portfolio Committee on Employment and Labour and the Select Committee on Trade and Industry, Economic Development, Small Business Development, Tourism, Employment and Labour, that a number of businesses will be forced to shut down post-Covid-19, resulting in massive retrenchments.
Minister Nxesi led a departmental team that included the Director-General, Mr Thobile Lamati, that sought to virtually brief the committee on the work the entities of the department have been doing in assisting employers and businesses. It was revealed that the Unemployment Insurance Fund (UIF) has paid out more than 37 000 claims, and that the entity was challenged with a spike of applications.
“There are projections from a number of economists that we might add another million people to the unemployment numbers which we already have in the country. This is a very serious matter.”
He said a lot of employers will apply for the temporary relief schemes, leading to the fund being under a serious strain. He cautioned that some of the employers have already informed workers of planned retrenchments, a situation which will result in the increased load of cases for the CCMA (Committee for Conciliation, Mediation and Arbitration). It was revealed that more than R500 million across the country’s provinces has been disbursed in benefits since the lockdown began. He said the department has strengthened the capacity of the UIF call centre.
Members sought clarity on various issues, including how the department handled infections among inspectors, UIF claims processed, payment of benefits to employees by companies, and informal traders.
Mr Lamati said the department was concerned about when the lockdown regulations are lifted, as that may impact negatively on workers if that was not done systematically. He said services had been automated at the department’s entities in order to improve the capacity of the processing team for UIF claims and other related applications.
By Sibongile Maputi
22 April 2020