Compensation for Occupational Injuries and Diseases Amendment (COIDA) Bill: public hearings day 4

Meeting report

Opening Remarks
The Chairperson opened the meeting.

The Parliamentary support staff noted the members in attendance and the order of the oral presentations that would take place.

Mr Virgil Seafield, Deputy Director General: Labour Policy and Industrial Relations, Department of Employment and Labour (DEL), briefly introduced the various officials in attendance and apologised that the Commissioner would be attending the meeting late.

Relay Emergency Medical Services Presentation (REMS)
Mr Richard Moodie, Operations Manager, REMS, highlighted that the current bill seeks to remove its  right to freely contract and cede our claims against the Compensation Fund. If passed the consequences for its practice, our staff, injury on duty patients (IOD) patients in the Port Elizabeth and surrounding regions will be dire. He asked the Committee to protect the interests of injured workers and the medical fraternity and remove Clause 43(4) from the Bill (which refers to prohibiting cession of medical accounts and claims) and allow REMS to provide the best healthcare to the workers of the country.

He highlighted where REMS worked, what it did and its capacity.

The Committee was informed that REMS has built a distinguished service and reputation to ensure the region receives responsive and professional medical services, specifically in relation to IOD medical emergency response, where time is of the essence.

Challenges:
-Insufficient number of ambulances
-Communication and assistance between private and public EMS practitioners
-Often difficult to get a private doctor or specialist to accept the continuation of care
-Over-burdened system – there were patients than healthcare providers

The presentation including the airing of 3 video clips.

Discussion
Mr M Bagraim (DA) asked a question relating to clause 43(4). He asked whether he had understood Mr Richard Moodie correctly, in that if the amendment went ahead, it would result in Relay EMS being unable to assist both those coming through the Compensation Fund as well as the others.

Ms C Mkhonto (EFF) asked whether REMS had an opportunity to make a presentation when the Department of Health was busy with the National Health Insurance (NHI) public consultations. She suggested that the presentation that was given was more relevant to those public consultations – she understood that they were working with injured workers – but most of the challenges that were presented could be resolved by the Department of Health. She asked whether REMS could provide an average of public hospitals and private clinics that were rejecting injured patients.

Mr Moodie responded to the question regarding clause 43(4). He said the amendment would not only affect injured workers but other patients. Part of what REMS did was attend to injured workers, but it also attended to any other patient that required emergency medical services. These patients included victims of road accidents, mothers in labour, patients that were suffering from medical emergencies due to co-morbidity diseases such as diabetes and strokes etc.

In terms of presenting to NHI, he had personally not made a presentation. He stated there were challenges in both the private and public sector EMS. The sectors worked together for the benefit of the patient.

In terms of the question relating to percentages, it was difficult for him to provide exact statistics on which hospitals were rejecting patients. He had not conducted a survey in the health districts in which they operated. He had not come across a doctor who was unwilling to accept a patient. He had found that there were long waiting periods for those patients. REMS advocated for the patient to go to a hospital or facility that would be able to see them within a certain timeframe. REMS attempted to ensure that patients were attended to within 10 minutes of arriving at the Emergency Room. If they took that worker to a public sector hospital, they would be able to attend to that patient, but it would be difficult to meet that in under ten minutes. He could not accurately say which hospitals had delays – he found that there were times when there was an interruption in care, lack of discipline or a specialist who was not accepting a patient. If the specialist did not accept the patient, the patient would be moved to a public sector facility – which he did not think was ethically correct.

The Chairperson sought clarity whether medical aid was a significant factor that determined whether a patient would be seen. Her understanding was that REMS was a private EMS. It was stated in the presentation that it was a struggle for patients to be seen and they were often, as a result, taken to public hospitals - she wanted clarity on this. They were IODs patients. IODs that might not be members of a medical aid, or if they were, their medical aid was not providing sufficient cover for the patient to be seen by a private hospital.

Mr Moodie responded when they first encountered a patient, the patient’s ability to pay determined the facility that they were transported to. A medical aid patient would typically be transported to a private facility and that medical aid would then cover the cost of the emergency room, the hospital admission, specialist care and admission into the Intensive Care Unit (ICU), if required. He was not an expert on the authorisation processes for medical aids but his understanding was that there were often authorisation processes that happened on the administration side while they were attending to the patient in an emergency setting.

If they had an injured worker, that worker may also be on a medical aid, but it started out that the worker was injured on duty. They would therefore treat it as an injury on duty and that required that the employer completed the necessary paperwork that needed to be taken with the patient. REMS then transported that patient to a private facility. The patient would often receive the initial emergency stabilisation care from both the EMS personnel and the Emergency Room personnel. When it was time to admit the patient into hospital, they would often encounter difficulty at that point. When a patient was accepted, it meant that the patient was discussed with a specialist and that they had accepted to take over care of the patient. This included admitting them into hospital. Often that was where, from his experience, they hit the ‘roadblock’ – the specialist upon hearing that it was an injured worker, and he would need to deal with the associated admin and paperwork, the specialist would not accept the patient. The doctor in the Emergency Room would then transfer that patient to the public sector.

The Chairperson stated that she had not gotten clarity regarding her question. Were patients not admitted, even if they had medical aid, as a result of the cover relating to that medical aid or the delay in authorisation? She asked whether REMS had ever been to the Burns Unit in public hospitals.

Mr Bagraim stated that it was important to know what was happening out there and why there seemed to be a problem in the sense that many patients were turned away. Patients were transferred to public hospitals the minute they were stable or required a specialist - was that because it was a Compensation Fund claim as opposed to a medical aid claim? There was a big difference between the two. The Compensation Fund claim created all sorted of hassles but the medical aid claim just required them to get authorisation – which seemed to be quite quick.

Mr Moodie stated that he had been to the Burns Unit many times – he had transferred many of those patients and attended to many life-threatening burns that required a Burn Unit.

When REMS received a call regarding an injured worker, it responded by going to the site where the worker was injured, it stabilised the patient and then transported them by ambulance to a hospital. They would normally transport them to a private hospital. REMS was then required to hand over the patient to the doctor in the Emergency Centre at the hospital. They then proceeded with the care that was required in an attempt to stabilise the patient. At that point, if the patient was an injured worker, that had no medical aid, they continued to provide care for the worker/patient. If they needed to admit the patient into hospital for specialist care or ICU admission, they contacted the specific specialist that would take over care of the patient. Upon hearing that it was an IOD patient, and there was no medical aid, they would only accept the patient if they were willing to deal with the Compensation Fund admin.  If the worker also had medical aid – but was injured on duty – it was very difficult to move it across to the medical aid. However, this was what the specialists preferred. They would immediately start dealing with the patient’s medical aid to cover the cost of admission and treatment rather than dealing with the Compensation Fund.

Hospital Association of South Africa (HASA)
Ms Amrita Raniga, Health Economist,  said that the effect of clause 43 of the COIDA Bill is to prohibit third parties (namely claims administrators and service providers) from taking cession of medical services provides claims.

This amendment has wide reaching consequences including:

 • threatens the provision of medical services to COIDA patients at private sector hospitals, and therefore their access to healthcare services as guaranteed in the Constitution of the Republic of South Africa, 1996 (“Constitution”), and will adversely impact revenue streams of private sector hospitals

• In the absence of Claims Administrators and Service Providers, medical service providers will increasingly refuse to treat COIDA patients

• This work would be pushed to the already overburdened public sector

 • This will detrimentally impact the patient’s health, recovery and future well-being which will negate what is essentially the primary purpose of the COIDA

• The removal of Claims Administrators and Service Providers from the claims process, will constitute a retrogressive measure on the rights of COIDA patients to access health care services as guaranteed in section 27(1) of the Constitution

The Socio-Economic Impact Assessment System Final Impact Assessment for Compensation for Injuries and Diseases Act (COIDA), version May 2015 issued by the Department of Planning, Monitoring and Evaluation (“SEIAS”) does not set out the full impact of this amendment.

 There appears to have been no consultation or consideration of the private healthcare sector when conducting the SEIAS activities. This is a significant oversight as medical service providers will be required to shoulder the burden associated with processing Compensation Fund claims, should Claims Administrators and Service Providers be removed from the claims process

Insofar as HASA is aware, the Compensation Fund and/or the Department of Employment and Labour has not, to date, provided cogent substantiation of the rationale for introducing the amendment contemplated in clause 43 of the COIDA Bill.

HASA welcomed the inclusion of domestic workers into the ambit of the Compensation for Occupation Injuries and Diseases Act 130 of 1993. However, it pointed out that there are no transitional provisions contained in the COIDA Bill that would lend support to ensuring that domestic workers are, from that date of their inclusion in the COIDA Bill, able to access adequate healthcare services for occupational injuries and diseases under COIDA.  This could threaten the very rationality of this amendment. In order to ensure that this amendment is capable of realising its purpose, the Compensation Fund will need to ensure that before this amendment takes effect, both employers and domestic workers are equipped and knowledgeable on how to comply with the new requirements under the COIDA (should this amendment be adopted).

HASA added that due to the lack of detail attendant to the amendments relating to rehabilitation in the COIDA Bill, it is difficult to ascertain the impact of this amendment and puts these amendments at risk of contravening the rule of law.

Discussion
Mr Bagraim said it was interesting that HASA had complained about similar issues to that which they had heard all along – in particular clause 43(4). He asked whether there was anything else that the presenter had seen that might be problematic in terms of the suggested amendments. For instance, many claims arose from individuals in the Workers Compensation Fund. Many injuries occurred through and from work. If one looked at the proposed amendments, one would see that there was nothing covered for those who were traveling to and from work. He asked whether the hospitals had kept records of how many people were injured on the way to or from work. From his understanding, and the feedback he had received, those constituted an enormous number of claims. If that was taken out of the Compensation Fund, they would fall under the Motor Vehicle Accident Fund. He asked whether HASA wanted to make a comment on that.

He noted the comment about the gross inefficiency of the administration of the Fund and the inordinate amount of time it took to pay if there was a claim against the Compensation Fund. The hospital groups were ideally placed to let the Committee know – in terms of oversight – of examples of gross inefficiency. They had heard about the gross inefficiency but they were hollow claims without justification or examples.

The Department of Employment and Labour might want to amend the legislation because there was some evil. The presentation suggested that this might be because they wanted to do away with claims or criminal action against service providers. The service providers suggested that there were no claims or criminal action against them; he suggested that HASA should communicate with them in this regard. It was said that there did not seem to be a backup system or training for domestic workers and their employers. The employers were probably more ignorant than the domestic workers. There was a previous presentation from people representing domestic workers who seemed to agree with HASA’s submissions.

Dr M Cardo (DA) noted the suggestion that the Department of Employment and Labour should focus on what did not work – relating to the Compensation Fund claims and administrative capabilities and efficiencies. However, proposals were not provided on how to do that. He asked why the claims and administration process could not be outsourced entirely. Was that something that the Hospital Association had contemplated or explored with the Department?

Ms Mkhonto stated that the issue of the current COIDA not being effective and efficient was coming up. She asked whether the presenter thought that those claims were directed to the Department and not them as service providers. If there were some loopholes that the Department had identified – what could they advise as a way of improving what was already there – in the sense of reducing fraud and corruption? That was what the Department had, in some cases, identified in the system. It was very disturbing for the people who were participating as so-called ‘beneficiaries.’ Maybe their interests were questionable. In respect of the rehabilitation that was said to be paid to domestic workers – it was not clear whether it would be paid to the employees themselves or to the service providers. What would be their suggestion in that regard?

Mr S Mdabe (ANC) pointed to a contradiction. The Committee was told that the Compensation Fund was ineffective, inefficient and that they took long to pay. At the same time the Compensation Fund paid when there were third parties or concessions that had been made. He asked for clarity as to when the Compensation Fund paid and when it did not. Did the Compensation Fund pay when it was required to pay directly to the medical service providers or when there were third-parties or concessions that were made? He referred to the last paragraph presented where it was stated that they were not consulted when the medical aid tariffs were being promulgated - he asked for clarity as to what was meant by that. The socio-economic impact study that was done by the Department on the amendment had not been investigated – has the organisation been involved?

Ms H Denner’s (FF Plus) asked if HASA, as a major role player in the field, was consulted or took part in the socio-economic impact study that was done in 2015. She asked the presenter to explain what the effect would be of clause 43(4) on medical practitioners, hospitals and workers.

Mr M Nontsele (ANC) referred to the rationale that introduced clause 43(4), the submissions suggested that there was a preoccupation with fraud and corruption. To what extent was HASA committed to getting rid of fraud and corruption? HASA suggested that the essence of the clause was solely about that – was it not also about giving the Department opportunities to improve on the areas they had stated they were seriously not…[unclear audio 1:33:47].

In terms of the inclusion of domestic workers, the submission basically stated that it was problematic as there were no transitional arrangements included. Had HASA heard about the ruling on this matter and the necessity that the provision should in fact be included? Taking that into account, were the areas proposed by HASA necessary? Did it support the principle of inclusion – he asked for clarity on this. This matter was confused further by the inclusion of the rehabilitation provision; it seemed that there was a bit of reluctance in terms of understanding and accepting that provision. He requested clarity as to what was meant by addressing the claims backlogs and other inefficiencies.

The Chairperson corrected Ms Raniga’s previous statement. The Committee was not an ‘ad-hoc committee’. It was a portfolio committee. It was a constitutionally formed portfolio committee – it was not special work that it was doing. The Portfolio Committee was doing what was prescribed by law and the rules of Parliament. It was important that she made that distinction.

Ms Raniga acknowledged her previous error regarding the portfolio committee. She delegated who would respond to the respective questions.

Mr Nasrudien Khan responded to the question raised by Mr Bagraim regarding the number of patients that were injured going to and from work. If patients were traveling to and from work – if it was not related to the work – those injuries would not come through as part of the Compensation Fund. Those injuries were then not classified as an IOD case.

He said it was important that the Committee understands the processes that the Compensation Fund had gone through. It was important to note that in the space of three to four years, the Fund had changed through three different systems. Initially the Fund was on a system called SAP, it moved onto a second system that did not work either. In October 2018 or 2019, he could not recall precisely, the Fund moved onto yet another system. In addition, the Compensation Fund made the decision at that juncture to move away from centralised processing to a decentralised processing system. Unfortunately, that exacerbated the turnaround time that service providers experienced in terms of the inefficiency of claims. It was important for the Portfolio Committee to understand the value chain, in terms of how a claim got to a payment status or an accepted status. There was a dependency within the Compensation Fund for employers to register on their system. Part of the challenges that the business sector had felt over the previous 18 months was the complexity of the new system in terms of getting a claim registered via the employer. Once the claim was registered, there was a dependency within the Fund – called an adjudication process. That claim would not be paid until somebody within the Fund adjudicated that claim. The dependency was within the Fund – the Fund relied upon clinical staff within the Fund to validate the clinical correctness of the claim. It was only after that process that the claim then moved to a payment cycle. From a hospital perspective, they had seen deterioration up until the end of the previous year. In defence of the Fund, they also needed to give credit where it was due, there was more stabilisation in the last three or four months in terms of the payments they were seeing within the system. The challenge of turnaround times remained – in terms of when the claim got an accepted status and when the Fund made payment on those claims. They had examples of claims of 180 days and 250 days where those claims were accepted but had not been paid by the Compensation Fund.

Mr Gavin Harrison responded to the question regarding why claims and administration should be outsourced. He stated that within the context of the proposed amendments, this was not necessarily something that was tabled – HASA therefore had not looked at it. It was something that they would be happy to engage on and look at. There had been discussion in the past within the private industry on that matter. It was something they would happily support and be involved in.

Mr Muneer Omar responded to the questions relating to domestic workers. From the context that Mr Nasrudien Khan had explained regarding the processes of regular claims it would be no different to that of a domestic worker. The fact that they were included was something that HASA wholeheartedly supported from a group point of view and from a providers perspective. As far as the process that needed to be followed by an employer regarding the registration process there were set turnaround times. Unfortunately, the experiences were different across provinces and systems. A fair amount of training was needed to inform employers of domestic workers. Training was also required so that domestic workers could understand their rights and responsibilities as well as the process that needed to be followed in order to get the claim lodged with the Fund. The challenge for the medical providers would be instances where a claim had not yet been adjudicated and they stood the risk of not being paid because of discrepancies with either documentation or content that might have been provided, or not provided by the employer, to the Department of Labour or the Compensation Fund.  

The Chairperson requested that a previous question be answered regarding whether HASA was familiar with the process that came about in terms of the inclusion of the domestic workers as an occupational group in COIDA. She asked that some of the initial questions be responded to.

Dr Dumisani Bomelo, CEO, HASA, responded to the question regarding HASA being consulted on medical tariffs. HASA would not, as a sector, be able to deal with the Fund as a collective because of competition laws. HASA was therefore keen to see it in writing - that there was an intention to engage directly with the hospital groups that were providing services. That was the way they were permitted to engage on issues such as tariffs and payment mechanisms. HASA used that same way of handling these types of matters when it came to medical aids. Each individual hospital group negotiated and deliberated on issues relating to tariffs directly on its own – they could not do that as a collective.

In terms of the constitutional ruling that affirmed the inclusion of domestic workers in the COIDA; the presentation did make it quite clear that they fully supported this. They were not questioning the ruling. It had merit. HASA was trying to point out that it was important that they did not just put policy or legislation in place and then not put equal arrangements in place to ensure that it was successfully implemented. They were not questioning the merits of the rehabilitation services. They were not questioning the merits of the inclusion of domestic workers – they fully supported this. They wanted to be helpful in ensuring that when it was done it was implemented properly.

Mr Bagraim referred to one of the responses, which said that the Compensation Fund only covered people through work injuries – that was not entirely correct, it covered people traveling to and from work at present. That would be removed – and that was the ‘nub’ of his question. Many injuries occurred when people went to work in taxis, private transport or on trains coming back from work – in these instances they were still covered by the Fund. The amendments appeared to intend to remove that claim. He asked HASA whether they had some statistics on this as it might be something worth looking at.

The other comment made was that there had been three different claim systems; they now had a fourth system – the system presently seemed to be the most inefficient. They had spent almost half a billion Rand on the systems; he wanted to know whether HASA thought that the system had improved efficiency or whether it was getting worse.

In terms of the domestic workers – everyone seemed to be in agreement that the inclusion of domestics in terms of the Compensation Fund would be an improvement to the legislation. The ‘devil was in the detail.’ People waited for years for their claims to be sorted out. It was almost impossible in some circumstances to get payments – could one imagine domestic workers and their employers trying to do this – he requested comment on this. As it currently stood, one had third-parties who were experts and were still struggling in getting claims paid – can one imagine domestics trying to do that.

Mr Nontsele requested clarity on his previous questions and appreciated the responses given relating to the domestic workers.

Mr Harrison addressed the questions relating to fraud. He stated that HASA did not have exact figures in terms of the amount of fraud that had taken place in the system. On a higher level, there were essentially two parties in fraud; there was someone who was offering something and someone who was receiving something. What HASA was concerned about was that it would not necessarily disappear by excluding service providers and people who were providing that type of administration services. If the inefficiencies remained within the fund going forward, and they had providers who were claiming… [unclear audio1:57:27].

Mr Gavin Harrison lost connection.

Mr Khan stated that Mr Bagraim was correct, it was in fact a fourth system. There had been slow improvements relating to the new system that was implemented. The challenge for them was the migration from the other systems. Whether it was the first, second or third, unfortunately a lot of those claims were not properly migrated onto the new system. This had resulted in a lot of inefficiency. The current inefficiency within the system was the long delays for the employer groups – he hoped that there would be some employers that would make representation during the day. There were a number of challenges that the employer groups were facing in terms of registration on the system – and the time it took to register on the new system. They had seen an improvement on the new system over the past few months.

Ms Raniga stated that HASA would get back to the Committee regarding data on travel to and from work.

Mr Harrison stated that HASA was not aware of the extent of fraud within the current system. It was concerned about the fact that the fraud would not necessarily go away by removing the third-party service providers. As long as the inefficiencies and slow payments remained, there would always an opportunity for people who were desperate enough to get their cash to deal directly with members of the Fund. Fraud was a two way street essentially.

The Chairperson stated that there had been more than four systems, she asked for clarity regarding the first two systems that were implemented.

Mr Khan could not recall offhand the name of the first system, the second was SAP which was in place for approximately 14 months. The systems had changed with the commissioners.

Dr Bomelo emphasised that HASA and its members, as well as the private hospital sector, were against fraud. They would like to assist in combating fraud. It appeared that they had not made this clear. It was their goal to eliminate fraud and work with any agents, be they government or otherwise. They were happy to work with any authorities to work against fraud – they were ‘anti-fraud.’

Ms Raniga stated that HASA was not consulted in respect of the social economic impact study. In terms of the impact of clause 43(4) in relation to the hospital groups, if it was approved in its current form, it would simply add onto the administrative burden instead of encouraging doctors to focus on clinical work. She invited Mr Khan to elaborate further on this.

Mr Khan stated that it was important for the Committee to understand that from a principle point of view, from a COIDA admission point of view, the hospital groups did not reject any COIDA admissions in hospitals. It was important to understand that there was a dependency within the hospital groups for a service provider, who was either a clinician or a surgeon, to be the administrator or admitting doctor for that particular patient. HASA’s concern related to their associated services / patient referrals they got from the doctors. In the current format many of their doctors in the hospital groups were making use of third party administrators to manage the COIDA administration on their behalf. HASA’s concern therefore going forward related to admission of those members that had the right to be admitted into a private facility. The onus would move away from the third-party administrators and become an administrative burden to the medical profession who need to handle the administrative work to get the Compensation Fund claim registered onto the system.

Richard Spoor Incorporated Presentation

Mr Richard Spoor delivered the presentation.

Regulated assessment of permanent disability
The current Bill seeks to grant the Minister the authority to codify the strict mechanism by which section 49(2) awards are made and their percentages, negating a broader discretion that presently exists.
This will make it harder to challenge inequitable awards. Presently the courts have held that circulars are not law, and must be judicially considered against the case’s circumstances.  In some cases, a slavish application of a circular will result in an injustice – i.e. 24 month period before a section 49(2) assessment. In other cases, a circular includes arbitrary provisions that nobody can explain or justify, and always tend to act to the detriment of the worker or their widow, i.e. 65% PD cap on mental illnesses. 

Discouragement of legal representation
The current Bill seeks to restrict the awarding of legal costs to those of a Magistrate’s Court tariff. Currently they are whatever is deemed equitable by the presiding officer, similar to the Labour Court, and including High Court tariffs. The subject matter of COIDA is frequently complicated legally and medically. The assistance of a good lawyer is frequently essential in these medico-legal cases. The best way to develop the law surrounding COIDA is to ventilate its issues before the courts, but this requires good legal representation during the tribunal period as well. Our courts are bound by the factual findings of the tribunals. Magistrate’s Court tariff will dissuade most lawyers from accepting instructions to challenge bad COIDA decisions.

Privatisation of social security
The Minister and Director General have delegated most of their powers under COIDA to private mutual assurance entities, including the power to call an impartial tribunal for hearing objections against the private mutual assurance entity. The Minister has forced entire classes of employers and/or employees (metal workers) under the privatised mutual assurance entity, RMA, without their voluntary election. The present Act does not allow for any of this, and it renders the system biased and unfair. The current Bill seems to legitimatise some aspects of this, by creating the power without dealing with the arising problems created.

Balancing private issues with public non-delivery of services
There is a critical need for Parliament to ensure adequate safeguards are in place to ensure that:
- The Compensation Commission provides performance within a reasonable period – finalising claims within 180 days of being reported.
- The Mutual Assurance / Licensees provide performance that is not dedicated by profit considerations and the appeal mechanisms remain fully independent and impartial in that justice is not only done, but seen to be done.
- The tribunal assessors’ appointments are subject to union and employer association consultation and verification. 
-The worker receives the most generous interpretation of the Act – Davis Rule.
- Part of this may be a statutory recognition of Kate/Njongi constitutional damages (interest) on overdue social security payments; encouraging rapid delivery and erring on the side of the worker. (see for example section 94(4) of the Occupational Diseases in Mines and Works Act, for a pre-Constitutional interest clause)

In their view, the Constitutional Court, it did not consider the question before it in the Jooste judgment with its eyes fully open. It should have recognised that there are certain problems with the immunity when:

-Service delivery of the Commissioner fails… frequently.

-General damages can be obtained against a defendant without proving negligence by an employer – it is strict or presumed.

-Blue collar workers are disproportionally affected by Schedule 2.

-White collar workers are capped to low maximum benefits unless negligence is proven – where under section 9 of OHSA and section 5 of MHSA negligence should be presumed through a duty to take reasonably practicable safeguards.

-This does not however mean that COIDA is unconstitutional as a whole, but that Parliament must intervene to ensure workers receive the correct benefits under the Act.

-Presently an employee under a labour broker has greater rights under COIDA and the common law than a full time employee with the principal employer. COIDA only recognises one ‘employer’ as holding immunity. The employee can hold both strictly liable, under COIDA for the broker employer and under the OHSA/MHSA for the principal employer.

What needs to happen is that the different sides of the occupational health and safety legislation coin needs to be rationalised. Re-consideration of the gaps and communications between MHSA, OHSA, COIDA and ODMWA (plus maybe the CPA, UIA, NEMA and Apportionment of Damages Act).

Discussion
Dr Cardo asked a question relating to the concerns on the amendment of section 30. The presentation had stated that section 30 entities under the amendment would serve a valuable function of ensuring that COIDA was effectively managed and implemented. The Compensation Commissioner was quite notoriously ‘delinquent and ineffective’ – as quoted from the presentation. Section 30 was also presented as a privatisation of constitutional rights; it suggested that privatisation increased inequality. How did one quantify that? Could an argument be made that if the processing and payment of all the funds claims over the past 20 years had been outsourced to private sector operators, many more workers would have received compensation more quickly. What was the presenter’s view on the proposed section 43 amendment – which had been the focus of concern of most of the previous presenters?

Mr Bagraim referred to section 30 – he assumed Mr Spoor was in favour of it. He asked whether this came as a result of the inefficiencies of the Fund. Were private insurers needed if the Fund was working efficiently? In terms of section 58(f), it was notorious that when one got involved with government institutions of that nature that the recovery of the legal costs were miniscule. Not many attorneys wanted to get involved with legal fights of that nature because of the fact that they very seldom got refunded their legal costs even on a wholly successful claim. He requested a comment on this. In terms of dependents, Mr Spoor referred to disabled children - but beyond that what about children who were still dependent upon their parents at 25 years? There was almost a 50 percent unemployment rate in South Africa. Most parents, if they could afford it, desperately wanted to educate their children with a tertiary education which often took them beyond 25 years.

In terms of the delays in processing claims – he suggested that they might need to get the admin right first - before amending bits and pieces. The amendment relating to domestic workers was necessary – however he was not sure whether the other amendments were necessary. In terms of the proper assessment of needs, if for example, he lost an eye it would not make a difference to his legal practice nor his ability to be an MP. There needed to be a proper assessment of how to reintegrate people back into work. They had received a presentation from those who conducted workability assessments and assisted people back into the work place. The point was made quite strongly, that each injury had to be individualised. He asked whether Mr Spoor could expand on that.

Ms Mkhonto referred to the presentation, where it was stated that ‘good’ employers subsidised ‘bad’ employers – in reference to the working environment. Which section of the Bill needed to be amended in this regard? He referred to post traumatic stress disorder (PTSD) should there be funds for counselling in terms of the affected workers?

Mr Mdabe asked whether the presenter had made a written submission. He requested that this be given to the Committee. He referred to the last part that was presented, that they needed to look at the fundamental reforms of the 100-year-old Act. Was his submission in relation to the dysfunctionality of both the Compensation Fund and Rand Mutual Fund? Did he perceive that the ineffectiveness of the Compensation Fund had anything to do with the fundamental reforms that had to be undertaken in relation to the Act?

The Chairperson asked whether the presenter had made any presentation to government previously on the observations. She asked the presenter to repeat what he had said about the ‘fault of a worker.’ She was unsure whether she had understood the presenter correctly in that regard.

Mr Spoor explained the issue regarding ‘fault.’ In the past the thinking was that if a worker was involved in the accident, they needed to find out whose fault it was: whether the worker was properly trained, whether he was negligent etc. Fault was a big issue. What had been done since, was that the culture of health and safety had developed, work was inherently dangerous, some work was more dangerous than other types i.e. office work was less dangerous than mining or steel work. When workers were exposed to dangerous environments, they suffered from accidents – it was inevitable. It was a statistical certainty. They knew that the mining industry was going to generate a certain number of deaths and a certain number of disabilities every year.

Why were they generating all the sick and injured people? They did so because the workplace exposed them to risk, danger and sooner or later they fell victim to that. The idea was that workers should be compensated for the harm they suffered as a result of exposure to risks and hazards in the workplace. The question of workers fault had become an irrelevant question. If one had 1000 men working on wood saws for a year, one of them would cut his fingers off. It did not help to ask why that person put their fingers in the saw blade. The truth was that someone would do it sooner or later. The question of fault was actually a distraction. It was the conditions in the workplace which were controlled by the employers that determined how safe or unsafe a place was. Fault should not be a reason to punish a worker by reducing his fair compensation. If the mining industry killed and injured people, it should compensate them fairly. The fact that notionally a worker might be responsible for an injury or death was not a reason to reduce their compensation as the Act did. The discount that came from giving up fault – was in fact a false quid pro quo. For example, in terms of pollution, the employer was responsible for the environment in which they produced. Occupational injuries were not that different.

He responded to the question posed by Dr Cardo, regarding the privatisation of the compensation scheme. He was not opposed to the principle of privatisation. He had previously pointed out that Rand Mutual was efficient and effective. One could simply have a law that required employers to buy insurance for their employees in terms of covering injury and diseases claims – and a certain number of minimum benefits that they would be required to pay. His concern was that to deal with the conflict of interest that privatisation created one needed a very good and effective regulatory system. In particular, a very good appeals and objections process to safeguard the interests of workers. Under-compensating workers and cheating workers out of benefits that they were entitled to was not very difficult. This was especially true when many were unrepresented and had very little input into the whole process. He was not opposed to a private system.

In terms of cessation of claims, they were not involved in collecting payments for doctors, service providers etc. He was aware of the enormous difficulties that they had - he knew that many employers gave responsibility for the recovery of compensation on behalf of employees and the recovery of medical costs to third-parties. Cessation of claims would benefit that. This was not an area where he worked or where he had any specialised knowledge.

Most attorneys would not touch that field – and that was a problem for workers who were unable to find legal representation in claims that were often of enormous importance for them and their families. There was another aspect that went along with the no fault system and that was the administrative system which had advantages. One of the quid pro quos was that workers could not sue their employers for injuries or deaths. If a worker got under-compensated – he lost his right in terms of section 35 of the Act to make a civil claim against his employer. That was part of the deal of a statutory no fault scheme – one could not sue one’s employer for negligence.

The problem reflected back on health and safety. It meant that there was very little precedent in the law about what was reasonable, practicable and what could be expected from employers. This was because there were never any court cases dealing with those matters, negligence, fault nor conduct of the employer - the law was never developed. The law about what was reasonable and what was required on the part of the employer was poorly developed because of the provisions of section 35 of COIDA, which effectively meant that none of those cases ever came before a judge, and no judge ever pronounced on them. That impoverished the health and safety environment and meant that they did not learn a lot.

An example was furnace explosions and eruptions – he had done about a dozen cases in relation to this. It was the same accident and the same reasons each time such as water leaks in the furnace and poor maintenance. If one considered Zambia, the compensation law in Zambia was a lot less generous than the South African law, but one was entitled to cover the difference, between what one got out of the statutory compensation scheme and the common law negligence claim, through litigation. That was another model. He was not promoting one or the other. If there was a proper statutory system, that paid workers fairly, the fact that there was no law around the issues would not be that important.

In terms of processing delays – he was unsure of how to fix that problem. It was not within his expertise as to why the systems were not functioning as well as they should. He noted the point regarding dependents over the age of 25 years. Currently the law covered children till the age of 20 years old. It was a provision that probably discriminated in favour of wealthier and better educated parents.

In terms of the assessment of claims, there were very sophisticated systems to assess injury. On the one hand they had the ‘meat chart.’ Then they had the American Medical Association Guidelines on Disability. An enormously complex, big volume that was copyrighted – it cost a fortune to get hold of and implement. In terms of assessing compensation, disability and impairment – you had the two assessment approaches on opposite extremes. He thought it was possible to find a compromise – something that was fairer, just and could be efficiently implemented, without having to go the whole way of using the AMA guidelines. He did endorse the notion of employing occupational therapists to do proper assessments. In the cases of more severe injuries, one could look at a workers ability to earn a livelihood – through an occupational therapists assessment.

In terms of the question regarding ‘good’ employers compensating ‘bad’ employers, the Act was extremely vague on the calculation and determination of premiums. To his knowledge, they had different premiums for different industries. If one was an office worker, it was a particular contribution to the Fund, if one was an employer in the mining industry, one would pay more because of the higher risks. It was not selective enough that one could identify ‘good’ versus ‘bad’ employers. They were not taking the data that came in, assessing it and adjusting premiums and levies on an individual basis to punish bad employers and reward good ones. There was another problem that would creep in which, in the case of mineworkers for example, diseases appeared over a long period of time. The worker might be in a different employment position when the symptoms started expressing themselves – and the new employer would be responsible for this rather than the previous employer who exposed the worker to the harm. This was the case with some cancers caused by exposure to chemicals. This could present itself long after the fact. COIDA acted like a short-term insurer, it was designed to compensate for traumatic injuries and dramas. It was not actually set up to deal with diseases and problems that manifested over a long period of time. Bringing diseases into the short-term insurance scheme created all kinds of problems – they needed to be careful that they did not tax employers who did not really contribute to the disease burden of workers versus those who did. How one designed that system to achieve that end was very challenging. One needed to be alert to it.

In terms of PTSD counselling, he liked the idea of rehabilitation. They had seen this in the Road Accident Fund, money being directed toward rehabilitation and doubtless it sounded like a good idea in this instance. One needed to be careful, some people were so damaged that all the rehabilitation in the world would not fix them – this was particularly the case with psychiatric injuries. One had to be careful not to delay compensation unduly while one was so called ‘busy with rehabilitation.’ In practice, the law as it stood, assessed a person two years after the accident – that was how one assessed permanent disability. They would run into problems where Rand Mutual would say to them ‘well they’re not sure whether it was final yet – Rand Mutual would want another year of therapy, another year of medication to see whether he’d recover by himself.’ One created a moving target where the final compensation was never determined. It was a big problem they dealt with.

The call for fundamental reforms – the reform was required on a principle basis because of changed notions and understandings about appropriate compensation. Another good argument for fundamental reform was to integrate the Act more closely with the Mine, Health and Safety Act and the Occupation Health and Safety Act. They did not speak to one another. The Mine, Health and Safety Act provided for workers that were deemed to be unfit to fulfill their work – there were provisions in the Act that did that. That did not speak to COIDA. There were examples where miners under the Mine, health and Safety Act were disqualified from further employment – but they did not qualify for compensation under COIDA or under the MBOD. That did not make a lot of sense.

A proper workers compensation scheme would make it expensive for employers who did not have good health and safety standards in the workplace and would reward people with far lower premiums. This should be a real and tangible cost. They needed to make the system more efficient so that it was sensitive to the efforts that employers were taking to minimise risks to workers in the workplace. One needed to be very careful, under the current Act, if one sued an employer for additional compensation under the provisions of section 56 of COIDA – that money was recovered by the employer from the Fund. They hit them with a big charge, a big levy and punishment to top-up their premiums. They handled a lot of additional compensation claims based on the negligence of the employer. Invariably those claims were settled privately without reference to the Compensation Fund. Employers were choosing to settle the claims, pay compensation to the workers, which they were happy about. The Fund never knew about those settlements – they were unaware that a settlement like that had been achieved. The result of this was that the employer would not be penalised. In fact, when they engaged with the employers, they knew for a fact that they did not want to run the matter to trial because if they were found responsible, there would be a big uptick in their premiums. They would end up paying an enormous amount of money. That’s what incentivised employers to settle and do deals through them.

In terms of representations, the only time they engaged with the Department of Minerals and Energy and the Minerals Council was in terms of the integration of the compensation system. They had given input on that. These reforms should really be driven by trade unions. They had a lot of trade union clients. In part, as a result of the high turnover amongst trade union officials, the issue of workers compensation was not taken seriously amongst trade unions. The only trade union, to his knowledge, that had a permanent department that dealt with occupational injuries, diseases and compensation was Solidarity. It would be good if the other unions developed greater expertise and lobbied for the kind of changes and reforms they needed. The truth of the matter was that very few people were aware of how those systems worked. Very few people were aware of the shortcomings. The victims of occupational injuries and diseases were politically and economically powerless because they were disabled, sick or dead. There was not a lot of political pressure and awareness to achieve reform. The best hope was the trade unions.

The Chairperson asked who was accountable when workers did not adhere to the safety protocols i.e. not wearing safety shoes when an accident occurred. She raised this issue because she was a former worker, and she understood that at times workers became a bit ‘naughty.’ Obviously a mineworker nor a steelworker could do that – as there were life and death consequences. She suggested that challenges in workplaces should be categorised. She noted the issue regarding training.

Mr Spoor responded that if the employer equipped workers appropriately, trained them appropriately, disciplined them appropriately and introduced appropriate controls – no worker would ever be non-compliant. If one did not have proper, training, discipline and controls, employers would know that workers would sooner or later appear without ‘safety boots on.’ Healthcare workers were trained in how to use needles, how to handle them, dispose of them etc, yet workers pricked themselves with a needle – it happened. One could minimise needle-stick injuries but one could not eliminate them entirely. If one reduced compensation based on such faults – it would be unfair. They saw a lot of accidents where workers did not follow the correct protocols. Employers put a lot of pressure on workers to deviate from prescribed laws and standards in pursuit of profit through higher production and profit. As a policy choice, the employer was incentivised to minimise injuries, because it would cost him a lot of money. He must take those reasonable measures – the workers should not be penalised if they came to harm as a result of the innate risks. It was part of the employers’ cost of doing business. If one created a risk, one needed to be responsible for the harm that ensued from the risk.

The Chairperson asked why the other trade unions did not cater for this – what was the other causal factors besides the high turnover of staff?

Mr Spoor stated that the biggest factor was that it was an insurance scheme; the employer was the insured and the insurer was the Fund or Rand Mutual. There was no role for trade unions in that process. What typically happened was that a worker got injured, then got dismissed and compensated – where was the role of the trade union in the process? They did not get to see or assist him in the lodging of the claim. In fact, the worker did not even lodge the claim. The employer lodged the claim. The job Solidarity did, was more in the form of legal work – legal work on behalf of their members in pursuing claims and the like. Solidarity also did a lot of objections and appeals. This was outside the competence of the trade unions. One needed specialist people to do that. Employers did not in general submit claims in a manner that aligned with the best interests of the workers.

Workers Compensation Assistance (WCA) Presentation
Mr Brian Pivo, Managing Member, WCA, delivered the presentation.

General comments on proposed amendments
Positive:
- Enfolds domestic workers in private households
-Modernises the principal Act
- Restores the role of the Compensation Commissioner
-Emphasises rehabilitation / reintegration
-Simplifies and improves the no-fault principle
-Brings the Act in line with prevailing law

Negative:
- Misses the opportunity to clarify “employer” vs “exempted employer” vs “employer individually liable”
- Introduces some items of deep concern (dealt with individually below) mainly in areas of:
-Penalties
-Institutional capacity and
-Regulation.
-Typographic / grammatical errors

Items of concern in order of seriousness
The following items were presented in detail (refer to slides):
Section 16 (which amends section 39 of the principal Act):
"(6) An employer, who fails to comply with subsection 1 shall be liable to a penalty of 10% of the declared annual earnings
Section 43(a) (amends s83)
"(5) If the earnings actually paid by an employer in respect of a particular period differ from the current estimated earnings shown
Section 17(c ) (amends s40)
Issue: This and all penalties should be stated as a maximum.
Section 14(b) (amends s30)
[Mutual associations] License to carry out Business of Compensation Fund
Section 36 (amends s73)
(4) Cession or relinquishment of medical claim void -
Section 34(b) (adds s70A)
70A. the Compensation Fund may provide facilities, services and benefits aimed at rehabilitating employees suffering from occupational injuries
Section 44(b) (amends s85)
(3) If the employer is participating in the rehabilitation of employees as prescribed, the Commissioner may give such employer a rebate.
Section 1(k) (amends s1)
"'employer individually liable' means an employer who in terms of section 84(1)(a) and b is exempt from paying assessments to the compensation fund

Items of concern degree of seriousness: clause 43(a) amends s83
Practical considerations:
– It is all too easy, with the CF on-line systems, for an Employer to make an error in reporting “earnings”.
– A simple error such as skipping a decimal point could lead to assessments that are a hundred times over-stated.
–Similarly, an Employer may under-state earnings.
– Therefore, no limitation should be imposed to the Commissioner’s right to correct an assessment to bring it line with the actual earnings.
– Specifically, the time at which the error is discovered or made might not be in respect of the earnings “currently estimated”.

Discussion
Ms Mkhonto referred to the introduction, where the size of the company and the people representing the company was clearly explained, however she had not heard what the mission was of the company and who they were servicing. Were they beneficiaries workers, medical service providers or employers? She requested clarity on this.

Dr N Nkabane (ANC) stated that there were many issues raised around the impracticality for employers and employees in terms of COIDA claims. Amongst the issues that the presenter mentioned was the impossibility to obtain medical reports from the public facilities. She was not an expert in the field but she wanted to understand whether there was a study that was done or whether it based on experiences or analysis of both the private and public facilities. In a nutshell the presenter had suggested that the public facilities were inefficient – what made them reach this conclusion? She also requested clarity regarding the error of reported earnings. Does the system allow for the error to be captured and rectified once identified? She asked whether the form used when people were processing claims was different from the questionnaire used as members of society – in terms of the COVID-19 questionnaire. She requested clarity on this. 

The Chairperson requested clarity whether they experienced problems if the forms were not correctly completed. Did this delay the process?

Mr Pivo explained that their clients were typically employers and they also had injured employees via their legal insurance i.e. Scorpion Legal Services. The assistance they provided employers was administrative. Typically, an employer that employed 1000 employees or more would have a person or a team of people who would attend to the claims administration or to the administration around the reporting of earnings and letters of good standing in order to continue with business. The responsibility that they took upon themselves was to do the administrative work for them. They effectively outsourced the administrative work that they would otherwise have to do. They also guided them to make sure that the work they did was compliant. If they were reporting accidents, they made sure that the documentation that was submitted was complete.

In terms of the difficulty of obtaining medical reports from the public sector – no they had not done a formal study; that was anecdotal. Under typical circumstances the way that they operated was that they would receive notice from a client/employer that an accident had taken place and they would effectively hold the employers’ hand through the process. They would then get involved in the work that the employer would otherwise have to take on themselves which was in some instances to contact the doctor that treated the employee and obtain a first-hand medical report. There would also be subsequent reports when the employee was ready to return to work and resume his duties. Medical reports would need to indicate that the employee was ready to return to work and was medically fit. If the employee was off for a period of time exceeding a month, there would be interim progress medical reports that would need to be obtained from the doctors.

Anyone who had dealings with doctors’ rooms would know that the receptionist was very protective. One could not easily get through the doctor, if the medical reports were available on file, they would be drawn from the file and sent to them or to the employer. Or they would inform them that it had been uploaded onto the Commissioner’s system and there was no need for them to obtain it. The work that was involved was cumbersome and onerous. Prior to the electronic submission of documents – medical services submitted reports directly to the employer and the employer vetted the documentation to ensure that everything was correct. The doctors invoice was normally communicated with the report – in the early days the medical report and invoice were on one piece of paper as the doctor would not be paid without having communicated the medical report.

If the patient was admitted to a public hospital they were not just dealing with the receptionist or two, they were contacting a provincial hospital which could employ thousands of people. Simply obtaining the identity of the person who should have submitted the report, the name of the doctor who would have compiled the report and treated the patient, became a difficult job. Those people were generally under a lot of stress and were over-worked. To get a report from them was made more difficult by this. It was not an impossible situation – but in some cases it was close to impossible.

Ms Ravishni Mahadeo, Manager: Assessments, WCA, responded to the question regarding the reporting of errors in earnings. There was some difficulty with the online system. The system was very simple when one looked at it. The page displayed allowed one to enter the number of working employees and directors receiving a salary over the twelve month period. Once the earnings were captured and submitted for employees and directors there were delays in having assessments resolved. There were no clear instructions on the page that indicated that no decimal points were permitted. There were cases where decimal points were added, as Mr Pivo mentioned earlier on, resulting in assessments that were ten to one hundred times greater than what was expected for the year. There had been a government notice that was implemented from 2016 in which the Compensation Fund had made it clear that they would not entertain any requests for the revision of earnings even if the earnings had been captured incorrectly or by accident. If it had not been requested in 30 days, it would not be entertained at all. Employers would then be expected to pay assessments that were ten times the amount of their true assessment. This had been applied retrospectively which was becoming even more difficult – as the requirements differed each year. Once the earnings were submitted, the employer could not correct this and there was no formal procedure in place by the Compensation Fund to ensure that returns were correctly processed should an employer require the earnings to be corrected.

There was a simple note to state that should the employer inform the Compensation Fund that the earnings that were declared were incorrect, the Compensation Fund should look into correcting the earnings to the actual figures. They were struggling with a lot of delays in this regard due to changes in the requirements and notices that had been put in place banning employers from correcting the earnings in any form – let alone online.

Mr Pivo stated that in terms of the online questionnaire, the information asked for online was not any different to the COVID-19 questionnaire. The issue they had was fairly subtle and administrative; there were two steps in their view in the process of bringing a claim to the Commissioners attention and for him to apply his mind to the facts of the claim. The Act made provision for two separate processes that were linked. The first was the reporting of the accident and the second was the adjudication of the claim. The reporting of an accident effectively brought to the attention of the Commissioner that an accident had taken place. The Commissioner required information on an urgent basis, for a variety of reasons, some of them practical and some of them legislative. One of the practical considerations was that, the claim itself was similar to that of a short term insurance company. Until they knew about the claim, they did not know what to do with the documentation or the information that might flow to them from other parties involved in the claim. If an employer reported an accident to the Compensation Fund late and in the meantime there were medical reports and other documentation that flowed from other involved parties, the Commissioner would have nothing to relate it back to.

In reporting a claim to the Commissioner’s office, one placed the Commissioner in a position where he knew of an incident that had taken place involving a particular employee and employer on a particular date. The Commissioner did not have a system in place that links a particular employer to a particular employee. A reference number would then be assigned to the case – that number had enormous value to all players in the industry, especially to providers of medical services. At that point the Commissioner would not have necessarily applied his mind to the information as provided – but simply the fact that the Commissioner was aware of it – made a difference. The electronic system should be set up to alert the employer that although the form was filled in, it was not completed in its entirety. There were at times delays relating to the information, for example one might not have access to the Police case number nor the registration details of other vehicles in a motor accident. The difficulty in the way the reporting process currently worked, was that before the Commissioner would acknowledge that the accident had been reported to him, he required all the information to be provided upfront.

The Chairperson asked whether it was right for someone outside the Compensation Fund to dictate how they should process their claims. They had a responsibility to ensure that the information was completed. Why did he prefer to dictate to the Compensation Fund – was that fair?

Mr Pivo stated that the law dictated that the Commissioner had rights to investigate a claim and call for information in any way he chose. They saw that as a very important right, the importance of the Compensation Fund to apply their minds in deciding liability. He was taken aback by the question – he did not intend to come across as prescribing to the Compensation Fund. In the context of the penalties that applied in the event of a report not being submitted in the prescribed form within seven days, cognisance should be taken of the practical considerations around providing the required information. Effectively when there was a delay in getting the claim number it resulted in it being very difficult to get medical treatment for an injured employee – they would like to see that issue addressed and separated from the adjudication process.

Injured Workers Action Group (IWAG) Presentation
Mr Tim Hughes, Spokesperson, IWAG, presented the Injured Workers Action Group presentation.

A video clip was shown where various representatives provided verbal representations.

The presentation was interrupted.

Discussion
Mr Nontsele questioned why they were listening to the views of ordinary South Africans, where opportunity had already been provided for that process. The Members would be unable to engage or ask those people questions of clarity

The Chairperson stated that these were public hearings, where they were required to listen to people making presentations. She asked the presenter who would respond to the questions of clarity in the absence of those represented in the video.

Mr Tim Hughes responded that IWAG an umbrella body with members from workers organisations, the medical fraternity and employer bodies. The video was put together quite recently, prior to the hearings and represented the views of their members. There were a lot of views expressed in the video that had not had been presented to the Committee. He would attempt to answer any questions on behalf of IWAG. If there were questions that he could not answer and did not have the professional competence or skill to do so – he would note it down and he would go back to those individual members for clarification.

Mr Nontsele suggested that IWAG should begin by presenting the presentation and then they could see the video as an addition.

Dr Cardo stated that IWAG was an action group that represented various role players; it was an umbrella body, so from his point of view it was quite interesting to get the perspectives of the members of the umbrella body which were reflected in the video. He supported continuing to watch the video. If the feeling on the Committee was that they should cut to the chase and get to the presentation first and come back to the video, he would be happy with that as well.

Ms Mkhonto supported the idea that they start with the presentation and come back to the video.

IWAG Presentation Continued
Mr Tim Hughes presented the IWAG presentation.

Workers hard won Constitutional rights are threatened by clause 43(4) of the COID Bill
- It prohibits Medical Service Providers from ceding their claims for payment by the Compensation Fund
- This will result in third-party administrators who assist the medical fraternity with administration and funding no longer being able to provide this service in the absence of financial and legal security.

There is no justification for clause 43(4) of the COID Bill
-It was stated that the objective of clause 43(4) is to remove the need to deal with third parties.
-They have NEVER provided evidence-based empirical, rational, justifiable reasons or benefits of doing so.
- The Bill’s SEIA provides no cogent reason for Section 43(4)
-The elimination of fraud and corruption between service providers, such as third-party administrators and the CF is mentioned but there is no evidence of any prosecution of any pre-funding third party administrator.
-To the contrary, pre-funding third-parties remove the opportunity for fraud, clean up claims and assist the CF with its efficiencies.
-    
General
- The COID Bill socio-economic impact assessment is fundamentally flawed.
- Clause 43(4) of the COID Bill is unconstitutional – it violate at least 3 clauses of the South African Constitution, namely, section 25, section 22 and section 34.
- Medical providers and employers are counting on Parliament to do the right thing and remove section 43(4) of the COID Bill.

Discussion
Dr Cardo stated that one of the big ‘selling points’ of the amendment bill was the inclusion of domestic workers. He asked what the joint effect of clause 43(4) would be in conjunction with the inclusion of the domestic workers. Did IWAG represent any domestic workers unions? Had they had any engagements with representatives of that sector on the Bill, and what would it mean for them?

Ms Mkhonto requested clarity regarding IWAG – that even after the inclusion of the domestic workers as beneficiaries – they did not see any changes that had to be affected to the COIDA. Was there nothing that needed to be changed in terms of the implementation of the Bill?

Mr Nontsele asked about the socio-economic impact assessment. Mr Hughes said that the impact assessment was in fact done six years before and was no longer consistent with the current conditions. He went on to make an example about domestic workers. The question of clarity was whether they were implying by extension that domestic workers were not ready to have those rights extended to them in terms of COIDA. It was suggested that the impact assessment did not take into account all the stakeholders views. What would be his proposal on how to remedy what he thought had been an omission with regard to the process?

The Chairperson stated that this was not the first leg of the Bill, this was the second leg of the Bill – it started in Cabinet. The Department invited communities and institutions to input on what they were putting forward as the amendment. She asked whether he had done that. She raised this as a result of the presenter’s questions regarding the socio-economic impact.

Mr Hughes said it was commonly understood that the Fund had challenges. He was not there to pull apart the Fund or to criticise anyone. It would be logical that the addition of 1 million new workers through 1 million employers would put pressure on the system. It was not unusual in domestic work that one would have a domestic worker working for five people – there were some complications as to how this was going to work. They might, for example, have far more employers. It may also be the case that employers did not have the skill, time etc to do this– thus they required an element of education. He did not know how claims would be processed where a minor injury at one employer might result in a more extensive injury at the next, days later. It complicated matters and would complicate matters for the Fund. It concerned them that the domestic workers might not get what was due to them or that the Fund may not be able to deliver the funds to all the claims – it was hypothetical and speculative. What would help would be to run a socio-economic impact assessment and run some numbers and scenarios. There were analysts, think tanks, Parliamentary content advisors – who could look into a hypothetical scenario.

The amendments to the Bill required concerted work by the Department, by employers, by trade unions, by themselves etc to ensure that domestic workers could realise their rights under the Bill. They needed to look into how to explain to the newly empowered workers what those rights were and how they could realise them. If they were injured at work – what did they do etc. How did they deal with the employer and what did the employer need to do. The Bill may be fit for purpose in terms of domestic workers but it was not fit for purpose in terms of clause 43(4). Sadly, they had an awful lot of work to do, to bring what was a legal instrument into practical reality so that people could realise their rights. There had even been work into looking into back-dating claims relating to injured domestic workers.

Domestic workers were asked to participate in the process – but they were not empowered to participate fully. It was regrettable that medical service providers were not consulted. He found it difficult to understand why that would be the case. He found it difficult to understand how third-party administrators and pre-funders were not introduced to the process. If they wanted good legislation – take a step back and do a proper socio-economic impact assessment that would enhance the quality of the legislation and make it fit for purpose. Maybe they could do that with regulation as well. It was essential to take the wider viewpoints into account.

IWAG had not seen the socio-economic impact assessment that was conducted – they had to look for it. He had thought that the socio-economic impact assessment had to be published at the same time as the Bill. Various parties were not consulted – he acknowledged the validity of the process completely. He suggested that they drafted one that was fit for purpose – it would not be unusual – there were other sectors out there that had conducted multiple socio-economic impact assessments. It was not unusual for socio-economic impact assessment to be redone due to a change in circumstances, or ministers etc. One would ideally want a good socio-economic impact assessment that was inclusive. The socio-economic impact assessment should ask who would be impacted. Unfortunately, this one did not tell one who was going to be impacted nor did it consult the people who would be impacted. It did not spell-out the benefits of the proposed changes of the Bill nor did it justify it. 
Mr Nontsele asked whether the issues relating to the incorporation of the domestic workers related to the outcomes… [unclear audio 6:07:21].

Mr Nontsele lost connection.

The Chairperson stated that the process of the Bill started the year before. Invitations were circulated for people to comment. It would be submitted to Cabinet and then the Office of the Speaker. She would have thought that what he had commented on in the presentation – in terms of the socio-economic impact assessment – could have been done when the written submissions were open.

Mr Nontsele asked whether Mr Hughes took into account the Constitutional Court outcomes with regards to the inclusion of domestic workers, so that when talking to the issue of exclusion on the processes relating to the social economic impact assessment – they should factor that in as well. The Constitutional Court went further than that and spoke to some of the issues raised by Mr Hughes.

Mr Hughes clarified that the only input made by IWAG was in the Parliamentary process when the Committee called for written submissions. He stated that Mr Nontsele’s point was well made however the Committee would have seen some submissions from the domestic workers unions arguing quite strongly for the retrospective application of benefits. That was a process that would still need to play out.

From the IWAG perspective, circumstances had changed; they now had one million new workers and employers. This did pose challenges to the Fund – would it not be a good idea to run some scenarios and get some ideas about what that impact would be. Circumstances had changed profoundly with domestic workers and their employers. Would it not be good to run another socio-economic impact assessment, taking those issues into account – go back and look at what domestic workers felt; did they understand the impact and what might happen? What about medical service providers? What about employers? What about banks and third-party administrators? It seemed like the socio-economic impact assessment missed so many important stakeholders. Circumstances had changed so much that it would possibly be a good idea to go back and look at those gaps. Could they get some data as to what those gaps were and whether they could quantify them? That might be able to help them build a somewhat better Bill that was more fit for purpose.

Closing Remarks
The Chairperson thanked the presenter. She noted that this was the last day for oral submissions.

The meeting was adjourned.