Every employer strives to become an employer of choice, offering a variety of employee benefits to attract and retain quality staff. A medical aid contribution is one of the most common additional benefits offered to employees, as well as a provident fund contribution being a fairly common benefit that is offered.
It all sounds good and well, however the question that arises is, whether the employee is, according to law, still entitled to these benefits during maternity leave?
According to South Africa's Basic Conditions of Employment Act (BCEA), all employees are entitled to four consecutive months of unpaid maternity leave. Although it’s not a legal requirement to pay your employees while they are on maternity leave, a loss of income can be a huge strain – especially taking into account all the additional expenses that are incurred during this period of time. Having uninterrupted medical aid benefits is vital for a new mother.
The truth is that the employer is not obliged to pay any contributions towards a medical aid, provident fund or any other benefit that the employee was entitled to prior to commencing maternity leave. As the employee is on a period of unpaid maternity leave, she is entitled to claim from the Unemployment Insurance Fund (UIF), provided that the employee contributed to the fund for a period of more than four months prior to commencement of the leave period. The Fund pays between 30% and 60% of the basic wage or salary that the employee earned while she was contributing to the fund, depending on her salary.
Due to the fact that the employer is not obliged to pay their portion of contribution towards the medical aid and provident fund during the unpaid leave period, the next question is, what will happen to these benefits while the employee is on maternity leave?
The employer and employee can enter into a maternity leave agreement, whereby the employer provides financial assistance such as continued contributions to the funds for the maternity leave period. The employee then agrees to remain in the employ of the company for a set period after the conclusion of the maternity leave period. Should the employee fail to remain in the employment of the company for the period stipulated, the employee agrees that any monetary contributions made in terms of the agreement shall become repayable to the employer upon termination or employment.
Another option for a benefit like a provident fund, will be to place the contributions on hold for the period of unpaid leave. Such an arrangement can be made with the provident fund provider.
Employers would be well advised to review their contracts of employment and workplace policies such as the maternity leave policy to provide more certainty for employees in such circumstances and to avoid any disappointment on the part of the employee.
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