Maternity and Parental Benefits for Self-Employed Workers in the Informal Economy
Updated: Apr 6
New South African Law Reform Commission Discussion Paper
The South African Law Reform Commission released Discussion Paper 153 on Project 143: Investigation into Maternity and Parental Benefits for Self-Employed Workers in the Informal Economy on 23 June 2021. Comments are invited by 29 October 2021.
The discussion paper is available at https://www.justice.gov.za/salrc/dpapers/dp153-prj143-MaternityParentalBenefits-July2021.pdf and the accompanying media statement at https://www.justice.gov.za/salrc/media/20210719-prj143-dp153.pdf.
The aim of the discussion paper is to determine two questions according to the media statement:
“a) Who should be included in the definition of “self-employed worker” (target group) in the informal sector of the economy? And
(b) What is the nature and extent of the benefit, that is, state maternity and parental benefits that could be offered to self-employed workers in the informal sector of the economy?”
The following recommendations are made:
“Recommendation 1: It is recommended that a definition of “self-employed worker,” which includes own account as well as wage workers, be integrated into the definition of “employee” in the relevant provisions of the Unemployment Insurance Act, 2001 (Act No.63 of 2001); the Unemployment Insurance Contributions Act, 2002 (Act No.4 of 2002); and the Basic Conditions of Employment Act, 1997 (Act No.75 of 1997)….
Recommendation 2: It is recommended that the existing Unemployment Insurance Fund system be extended by the Department of Employment and Labour to self-employed workers in the informal economy, so as to make provision for the extension of maternity and parental benefits outlined in the UIFA and BCEA to all workers. This will bring informal economy self-employed workers into a social security system as envisaged in section 27(2) of the Constitution. Implementation of the proposed maternity and parental benefits contribution scheme for informal economy self-employed workers will promote fulfilment of the State’s obligation in terms of the international instruments that are binding upon the RSA as discussed in Chapter 5 of this Discussion Paper…..
Recommendation 3: Alternatively, it is recommended that maternity cash benefits for self-employed workers be set at 100% of the reference wage. The cash benefit should be subsidised by the UIF if the reference wage does not allow a woman to maintain herself and her child in proper conditions of health and with a suitable standard of living….
Recommendation 4: It is recommended that section 30(3) of the UIA be amended as follows:
(3) The benefit payable to the dependant is the unemployment benefit referred to in Part B of this Chapter and the maternity benefit referred to in Part D of this Chapter that would have been payable to the deceased contributor if the contributor had been alive…
Recommendation 5: It is recommended that maternity leave benefits equal to the maternity leave benefit as provided for under section 25 of the BCEA, (that is, at least four consecutive months’ maternity leave), which allows for absence from work while earning a salary, be extended to self-employed workers so as to avoid extending current discriminatory practices into the legislative framework. …
Recommendation 6: It is recommended that parental cash benefits equal to the parental cash benefits as provided for under section 12(3)(cA) of the in Unemployment Insurance Act, 2001 (that is, 66% fixed rate of the contributor’s earnings as at the date of application, subject to the prescribed maximum income threshold) be extended to selfemployed workers so as to avoid extending current discriminatory practices into the legislative framework
Recommendation 7: It is recommended that parental leave benefits equal to the parental leave benefit as provided for under section 25A of the BCEA, (that is, at least ten consecutive days parental leave); adoption leave equal to the adoption leave benefit as provided for under section 25B of the BCEA (that is, ten consecutive weeks adoption leave); and commissioning parental leave equal to the commissioning parental leave benefit as provided for under section 25C of the BCEA (that is, ten consecutive weeks commissioning parental leave) be extended to self-employed workers so as to avoid extending current discriminatory practices into the legislative framework….
Recommendation 8: It is recommended that the existing CSG be extended to all pregnant self-employed workers in the informal economy who fulfil the criteria for child support grant….
Recommendation 9: Alternatively, it is recommended that the existing CSG be extended to all eligible poor and vulnerable pregnant women, including self-employed workers in the informal economy, who fulfil the criteria for child support grant. …..
Recommendation 10: To give effect to the Commission’s proposal for the extension of the CSG to incorporate maternity support, the Social Assistance Act, 2004 could be amended …..
Recommendation 11: It is recommended that government must accelerate the rollout of early childhood development centres in informal workplaces and spaces where informal workers reside, such as street trading; waste recycling; city markets; informal settlements and townships. It is also recommended that municipalities be urged to take up this recommendation in their industrial development plans as part of infrastructure provisioning.”
Proposed draft legislation, the Social Assistance, Employment and Labour Laws General Amendment Bill, are included in the Discussion Paper.