The National Employer Association of South Africa (Neasa) has urged government, as a mitigating measure on both business and workers, to make available Unemployment Insurance Funds (UIF) to pay employees during periods of absence as a result of the Covid-19 pandemic.
CEO Gerhard Papenfus said that while Finance Minister Tito Mboweni had recently said that all efforts should be geared towards ensuring that the already weak domestic economy ‘does not grind to a halt’, Covid-19 had added another dimension to the perfect storm in which business already found itself.
“The Eskom crisis is already having its impact, not to mention all the other factors contributing to the approaching 0% growth rate and 40% unemployment rate.”
Covid-19 would be an additional blow to business, Papenfus said. “But on the flip side there is business’s legal and moral obligation towards its employees. The decline in production as a result of the drop in business activity, combined with large numbers of absent employees as a result of either being diagnosed with the virus and booked off on sick leave, with full pay, or being in compulsory isolation, will negatively impact the sustainability of business.”
The economic effect of Covid-19 on business will be felt long after the pandemic has passed. The effect on the sustainability of business will have consequences for employees in terms of retrenchments, layoffs, shortened working hours and salary cuts.