More than two-thirds of Western Cape hospitality employers fail COIDA compliance

South Africa’s Department of Employment and Labour has issued an explicit financial warning to Western Cape hospitality businesses, revealing that over two-thirds of the province’s sector remains non-compliant with the Compensation for Occupational Injuries and Diseases Act (COIDA).

At a hospitality sector workshop held in Cape Town, the compensation fund disclosed that 4 871 out of 7 156 hospitality employers in the Western Cape are currently non-compliant based on the 2025 return of earnings (ROE) submission data.

The default rate leaves the province’s hospitality compliance at 31.93%, with just 2 285 employers fully compliant with statutory compensation rules.

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Assistant director for employer compliance, Aubrey Mukwevho, advised non-compliant operators to review their accounts for accumulated penalties and interest, urging them to arrange formal payment plans to avoid further financial sanctions.

Turnover-based penalties and enforcement frameworks

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The enforcement drive follows structural changes to the compensation fund’s penalty regime. Mukwevho highlighted that failure to register, late ROE declarations, and delayed assessment payments carry cumulative penalties calculated directly against a firm’s broader corporate turnover.

“From the 1st of April 2026, the fund started charging 10% penalty in cases where employers are not registered and not submitting ROE and making payments within the time frame with compensation fund that another 10% will be imposed on the employers reporting late or not reporting claims, the 10% penalties are calculated on the overall turnover of the company,” warned Mukwevho.

Administrative protocols and medical claim requirements

Beside baseline registration, officials emphasised strict operational protocols for processing workplace injury claims.

Nqabisa Pama, pension administrator for COID, detailed procedures regarding claim adjudication, specifically highlighting the processing of post traumatic stress disorder (PTSD) claims.

Pama reminded operators that injured employees hold statutory rights to chronic medication and reaffirmed that employers bear the legal duty to arrange and fund immediate transportation for staff seeking medical attention following an injury on duty (IOD).

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Concurrently, senior pension administrator Thembi Jini addressed processing bottlenecks within the fund, noting that payment delays frequently stem from incomplete online submissions on the CompEasy system.

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Common administrative failures include uploading documents under incorrect claim numbers or omitting required medical reports entirely.

Jini reminded employers of statutory timelines established under the Government Gazette: “All medical reports should be submitted to the Fund within 14 days.”

She added that once liability is accepted for a claim, employers are legally required to capture and upload all subsequent medical reports along with supporting documentation directly onto the CompEasy portal.

The Department of Employment and Labour confirmed it will continue targeted sector engagements to enforce COID compliance across industries.

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