UIF TERS Audits

EMPLOYERS UNDER SIEGE

Dear employer

NEASA has been inundated with complaints regarding the Unemployment Insurance Fund (UIF) TERS audit process. Employers are facing a relentless wave of irrational demands from auditing firms appointed by the Department of Employment and Labour (DoEL). These firms are issuing unrealistic requests accompanied by threats of severe consequences for those who fail to comply within unreasonably short deadlines.

Five years after the introduction of the TERS system during the COVID-19 pandemic, businesses are now being forced to provide extensive documentation, often within 7 days - or in some cases, as little as 24 hours. These demands come at a time when many companies are facing financial year-end pressures, making timeous compliance nearly impossible. To further exacerbate the situation, appointed auditors frequently demonstrate a lack of professionalism and understanding of business realities, with many employers reporting intimidation tactics and mismanagement.

It is important to note that while the Memorandum of Understanding (MOU) signed with the UIF does allow for audits, these should only occur when there is reasonable suspicion of a breach of the agreement, fraud or corruption. However, the current audit practices fail to adhere to these conditions, as no evidence of suspected wrongdoing is provided before audits commence.

Key issues raised by employers:

• unverified auditors making sudden, unannounced visits to workplaces without proof of appointment;

• audit reports mistakenly sent to the wrong companies, raising concerns about data security and confidentiality;

• businesses that never applied for TERS funding being subjected to audits without explanation;

• employer-appointed independent auditors uncovering significant errors in the Department-appointed audits;

• a lack of a formal verification system for appointed auditors, leaving businesses vulnerable to fraudulent or unauthorised audits; and

• reallocation of audit firm assignments resulting in duplicate requests and ongoing disruptions.

Despite the fact that no response has been received to NEASA’s previous requests to the Minister, the DoEL and the UIF to address these issues, NEASA has, once again, called for the implementation of the following measures:

• a verification system to confirm the legitimacy of appointed auditors;

• realistic and reasonable deadlines for documentation submissions;

• stability in audit firm assignments to prevent unnecessary disruptions; and

• accountability measures for audit firms engaging in misconduct, negligence or intimidation.

The current audit approach reflects a deeply flawed system that disregards the immense pressure placed on employers. We will continue to expose these injustices and push for meaningful reform.

If no change in approach is adopted by the UIF and the appointed auditing firms, and employers are forthwith subjected to these unreasonable demands, NEASA urges you to share your experience with us by sending an email to sanja@neasa.co.za.

For more information

NEASA Media Department

media@neasa.co.za

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