Sometimes government policies absolutely boggle the mind.  One that has recently come to my attention is the situation with the Unemployment Insurance Fund (UIF) and compensation for workers during the shutdown.  The law makes it clear that employers do not have to pay workers during this time and can deal with it in a variety of ways.  The Government however has said that it is going to assist workers, like governments do around the world.

That assistance though comes in the form of UIF payments that require the employer to agree to all sorts of onerous terms affecting the employer only - so that staff can get help via the UIF.   I wonder what sense this makes to government?  The employer is not getting a cent out of the UIF and it is only the employee who is benefiting, so why should the employer then tie themselves to a whole lot of onerous conditions?  It might make sense if the employer was legally obliged during this time to pay and needed the assistance of the UIF, but the employer is not.  In other words, for the man in the street to get some benefit from the UIF the employer - who is getting no benefits at all - has to agree to a whole lot of strict conditions imposed by the government so that their employee can actually get some benefits.  Or, the employer can choose not to agree to any of the strict requirements and simply allow the employee to go unpaid during this time!  Any employer who is sensibly advised by lawyers is going to decline the “benefits” from the UIF and if need be, allow the employees to go unpaid.  Why it is that the government has thought, in order for an employee to benefit, that the employer has to assume all sorts of onerous conditions is something that only they know?  Perhaps one could be cynical and say that they did give quite a bit of thought to it and decided that they did not want to pay out too much and so made benefits available only on conditions that they know that most employers would never accept.  The ANC can then claim that they have made provision for people to get support during this time and they can rest assured that not much will be claimed from the UIF because the conditions they have made are such that no sensible employer will actually take them up.

I think it is a tragedy because if the UIF is not going to pay out at a time like this, then when will it?  Other countries around the world imposed terms on businesses when the business is getting financial support.  They don’t impose terms on the business when it is the employees that are getting the support and of course in successful economies in most cases it is the government who is now picking up the salaries of the employees and not the companies.  It is not wonder that so few international companies want to set up shop in South Africa and as a result we have one of the highest unemployment rates in the world and will continue to do so until we start getting our labour policies and approach right.  Unfortunately, the ANC’s form of socialism has not worked anywhere in the world and our approximately 30% unemployment rate is a clear sign of that.