COIDA for employers, explained properly

Who must register

Any employer with one or more employees must register with the Compensation Fund. That includes a company with a single staff member, a sole proprietor with an assistant, and domestic employers, domestic workers have been covered since a 2020 Constitutional Court ruling. Registration is supposed to happen within 7 days of employing your first worker. There is no turnover threshold and no exemption for part-timers or casual staff. If someone works for you, COIDA applies.

What you get in return

COIDA is a trade-off. Employees who are injured on duty or contract an occupational disease claim compensation from the Fund, medical costs, temporary or permanent disability payments, and death benefits for dependants. In exchange, section 35 of the Act bars employees from suing their employer for damages over a workplace injury. An unregistered employer loses that shield in the worst possible way: the Fund can still pay the worker, then recover the full cost from you, on top of penalties.

The letter of good standing

A letter of good standing is the Compensation Fund's confirmation that you are registered, your returns are filed, and your assessments are paid. Tenders demand it. Construction sites will not let your team through the gate without it. Many corporate clients ask for it before signing any service contract. It is issued for a limited period and lapses if you fall behind on returns or payments, so treat it as something you maintain, not something you fetch once. If you are chasing a tender deadline with no registration in place, that is the queue you do not want to be standing in.

The annual return of earnings

Every registered employer must file a Return of Earnings (the ROE, or W.As.8) each year, declaring actual earnings paid for the past year and estimated earnings for the year ahead. The Fund uses it to calculate your assessment, effectively your premium. File late and penalties are added; skip it and your letter of good standing dies with it. The filing season is announced by the Compensation Fund each year and typically opens around April, with the deadline published for that season, so diarise it annually.

How the assessment is calculated

Your assessment is a percentage of your declared earnings, and the percentage depends on your industry class. Every employer is placed in a subclass based on what the business actually does, and if that description was vague when you registered, you may be in a higher class than your work justifies. We can check and apply to fix it: COIDA subclass correction, R890, and each subclass carries a published tariff that reflects its risk: office-based work sits near the bottom of the scale, while construction, mining, and transport pay several times more per rand of payroll. Earnings above the annually gazetted maximum per employee are excluded from the calculation. Getting your industry classification right matters, a wrong class can mean overpaying for years, or an ugly reassessment later.

What you need before you register

Registration is free and done online. This is what the Fund asks for.

• Your company or close corporation registration number, or your identity number if you trade in your own name.
• Your SARS income tax reference number.
• A clear description of what the business actually does. This decides your industry class and therefore your tariff, so a vague answer can put you in a more expensive class than you belong in. A firm that only does office work should not be classified with the people on the scaffolding.
• How many people you employ, including casual and part-time staff, and any directors or members drawing a salary.
• Your payroll figures: actual earnings paid over the past assessment year, and your estimate for the year ahead. The assessment year runs 1 March to the end of February.
• Your business address and contact details.
• Banking details for the account the assessment will be paid from.

If you registered the company through BizPortal you may already be done: Compensation Fund registration is offered there free at the same time, though only if you already had employees on the day.

How it runs, step by step

1. Register as an employer with the Compensation Fund. You get a registration number.
2. Submit your first Return of Earnings declaring actual and estimated payroll.
3. The Fund issues an assessment: your assessable earnings multiplied by your industry tariff, with each person’s earnings capped and a minimum assessment applied if the sum comes out low.
4. Pay the assessment. Payment is due within 30 days, after which interest runs.
5. Once you are registered, returns are filed and the assessment is paid, request the letter of good standing.
6. Repeat the Return of Earnings every year, and re-request the letter when it lapses. We can prepare and submit the annual return, then request the letter once the Fund requirements are met: letter of good standing renewal, R690.

The deadline that costs money. A Return of Earnings filed late attracts a 10% penalty on the assessment, and an unpaid assessment attracts interest after 30 days. Both are avoidable and neither can be argued away afterwards.

For the 2026/27 year, earnings are assessed up to R668 000 per person, up from R633 168 the year before. The minimum assessment is R1 621 a year, or R560 for domestic employers. Estimate yours with the free assessment calculator.

When someone is injured at work

Report the incident to the Compensation Fund as soon as possible, the employer's report of an accident (W.CL.2) is required within 7 days of a workplace injury, and occupational diseases must be reported within 14 days of being brought to your notice. The employee gets medical treatment, the doctor submits medical reports, and the Fund pays the claim if you are registered and compliant. Reporting an accident late or incompletely now attracts an administrative sanction (from 1 April 2026 these replaced prosecution for this failure), and it leaves your employee stranded without compensation while exposing you to the claim.

Penalties for staying unregistered

Staying unregistered breaks the Act. The practical consequences bite harder than any sanction: the Fund can raise back-dated assessments with penalties for the whole unregistered period, recover the cost of any claim it paid for your injured worker directly from you, and you remain locked out of every tender and site that requires a letter of good standing. Registering late is uncomfortable; being caught unregistered after an injury is far worse.

What changed in 2026

The Compensation for Occupational Injuries and Diseases Amendment Act 10 of 2022 was brought into operation in stages in 2026. The parts that matter to a small employer:

• Administrative sanctions replaced prosecution from 1 April 2026 for late or incomplete accident reporting, unlawful deductions from compensation, failing to pay the first three months of temporary disability benefits where they apply, and failing to keep records.
• Keep earnings and employment records for at least five years, on paper or electronically.
• The time limit to claim for an injury is reported to be extended from 12 months to three years. Do not rely on the longer period: report every accident straight away, in writing.
• Wider cover: post traumatic stress disorder is now expressly recognised, and so are work related training and travel in employer provided transport.
• A rebate is possible for employers who actively support injured employees back to work.

Sources: summaries of Proclamation Notice 306 of 2026 (published 23 January 2026) by STBB and the Department of Employment and Labour’s announcement as reported by Accounting Academy, read on 4 October 2026. Confirm the detail with the Compensation Fund.

Frequently asked questions