Secondment Agreement In South Africa

When examining a cross-border posting, both the employer and the worker must carefully assess the legal consequences of the posting agreement, in particular the laws governing the agreement and the forum competent to decide disputes that may arise from the agreement. In addition, the parties must take into account the impact of the posting on the posted worker`s right to continue to participate in group risk insurance, pension funds and medical aid schemes to which he may be affiliated by reason of his employment. Parties should not only seek advice on immigration legislation, labour rights and tax consequences, but also consult their fund managers and managers on the impact that the absence of a worker from the country may have on his or her participation in a medical assistance scheme, a pension fund and a voluntary or compulsory benefit, Like what. B funeral regimes. Workers who stay longer outside their home country may find themselves in an unfortunate situation of losing certain benefits or insurance coverages. Some guidelines and funds do not cover people who have travelled outside the country for a prescribed period of time. Certain legal safeguards, such as compensation for the Occupational Injuries and Diseases Act 130 of 1993 (COIDA), may also be extinguished if the worker stays outside the country longer than the prescribed period. For example, Article 60 of COIDA stipulates that “when an employed person or a creditor of a worker entitled to a pension within the meaning of COIDA resides outside the Republic or is absent from the Republic for a period or period of more than six months in total, the Director-General may, in lieu of that pension, give an amount in principal which he fixes, and the right to the pension is extinguished with the payment of this capital”. Before the Director-General exercises this power, the worker or creditor must be informed. The worker or creditor may ask the Director-General why his right to a retirement pension should not be terminated, but ultimately the Director-General will exercise discretion.

With respect to private plans and employer-sponsored plans, the question of whether a worker is still entitled to participate in and benefit from a plan is largely governed by the rules of each plan. For the purposes of section 29 of the Medical Schemes Act 1998, continued membership of a medical assistance scheme is provided for in the rules of the scheme. The rules of one of the major medical aid programs in South Africa provide that if a member works abroad for an extended period of time (up to five years maximum), the member can be demoted to a benefit option for the lowest income bracket, but upon returning to South Africa, the member can switch to any performance option. if they do so within three months of their return. This medical system allows the worker to remain a member during the period of posting. However, it should be noted that the rules of medical systems vary. For example, the rules of another leading medical system provide for continued membership in the system when a worker is deployed abroad on the instructions of the employer. Whether or not a worker remains a member of a medical aid scheme therefore depends entirely on the rules of the applicable rules. . .

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