The end of 2021 is upon us and as always, we wonder what the new year holds. At the end of 2020, we had all hoped that we would conquer Covid-19 in 2021 and that there would be a return to the world as we knew it! As the end of 2021 approaches, with the potential further lockdowns should the latest variant of the Covid virus get out of hand, we are no longer as naïve and probably mentally better prepared as we appreciate that Covid is not going away soon and that this is something that we will have to learn to live with!
If we exclude the issues that are beyond our control, there are some key items that will require our attention to ensure we ease into the New Year with less stress.
MEDICAL AID INCREASES
For those organisations whose financial years end at the end of February, the budget approval process should already be well under way. Have you ensured that you have accounted for the medical aid increases?
The increases from the country’s largest medical aid schemes are listed below:
| MEDICAL SCHEME | INCREASE | DATE | COMMENT |
| Bestmed | 3.9% | 1 January 2022 | Across all options |
| Bonitas | 4.8% | 1 January 2022 | Weighted average increase |
| Fedhealth | 5.5% | 1 April 2022 | |
| Momentum Medical Scheme | 6% | 1 September 2022 | Average |
| Discovery Health | 7.9% | 1 May 2022 | All health plans |
The implementation dates differ and increases differ depending on the scheme, so to avoid errors ensure that the increases are correctly loaded.
ANNUAL SHUTDOWNS
Several industries shutdown over the festive season and only re-open in the new year. This presents some unique payroll issues such as the payment of bonuses (where applicable) and the processing of leave and related payments. If staff are paid weekly or fortnightly, this will require further planning and preparation. Payslip end dates must be correctly entered to take into account the shutdown period and to ensure that UIF and tax liability are calculated correctly and spread over the entire period.
LEAVE SETUP AUDIT
Unless your business demands that your staff are onsite over the holiday season, by now you should have planned that staff are taking the leave that they have accrued over the past year. Carrying leave over to the next period has financial implications and may impact on staff productivity.
If the holiday season is a quiet period, it may be worth allowing new staff to take leave that is calculated on a pro-rata basis to avoid carrying a leave liability on the business’s balance sheet.
To find out more read our blog here.
EQUITY REPORTING
The Department of Employment and Labour has requested that employers are diligent and punctual in their report submissions. The reporting season opened on the 1st of September 2021 with manual reporting closing on the 1st of October 2021 and online reporting due to close on the 15th of January 2022.
The Employment Equity Act 14 (EEA 14) form must be completed fully and signed by the Chief Executive/Accounting Officer and accompanied by the relevant supporting documents. Employers who are no longer designated and do not want to report voluntarily may submit the EEA14 form with the latest Audited Financial Statement.
The reporting period is a 12-month period and all employers who employ 50 or more employees or have an annual turnover that is equal to or above the applicable turnover threshold set out in Schedule 4 of the Act, should submit Equity reports.
MIGRATING SYSTEMS TO THE CLOUD
If you have not already done so, it may be time to consider a cloud migration. For those that are not familiar with the process, it is simply moving from a local to a cloud server.
LSPinc. has the ability and the software to assist businesses with this process. We have selected Sage products based on years of client experience. For more information on how to migrate to cloud-based Payroll and HR software contact us for a consult at sales@lspinc.co.za or on 031 502 1743 or 010 446 0176.
