Employee Benefits – Late or Incorrect Payments and Information

Employee Benefits – Late or Incorrect Payments and Information

Payroll / eTorQue

Consequences for Employers and Employees

S13A of the Pensions Fund Act requires employers to meet certain deadlines with respect to both the payment of contributions and the submission of information to funds for these contributions to be allocated and invested swiftly.

  • Contributions must be paid by the 7th day of the following month; and
  • Information must be supplied by the 15th day of the following month

The consequences of getting this wrong are:

  • Potential criminal charge for the directors of the employer including a fine of up to R10m and 10 years in prison
  • Interest on late payments
  • A loss of investment returns for employees
  • Potential civil liability for loss of risk cover when premiums are not paid on time or misallocated

Employers spend considerable time choosing an appropriate fund for their employers, but then assume all the on-going administration within payroll and subsequent reporting to the fund works seamlessly. In practice this is seldom the case. Payrolls are set up incorrectly, payroll departments struggle to keep up to date with employee movements which impact benefits (engagements, terminations, maternity, disability, pricing changes) and fund portals are sometimes confusing or difficult to use.

With a little assistance this can be managed. HRTorQue administers many payrolls and fund portals and can either look after your entire payroll or help you design processes and reports to manage this risk in your organisation. Contact us at [email protected] if this is an area you need help with.