The Compensation for Occupational Injuries and Diseases Act (COIDA) requires all employers in South Africa to register with the Compensation Fund and contribute towards workers' compensation insurance. Your Letter of Good Standing proves you're compliant – and it's required for almost every government tender.
What is COIDA?
The Compensation for Occupational Injuries and Diseases Act (Act 130 of 1993) provides a no-fault compensation system for employees who are injured or contract diseases in the course of their employment. It's administered by the Compensation Fund, a division of the Department of Employment and Labour.
Key Concepts
| Term | Definition |
|---|---|
| Compensation Fund | The government fund that pays compensation to workers injured on duty. Employers contribute through annual assessments. |
| Letter of Good Standing | A certificate proving your business is registered and up-to-date with COIDA payments. Required for tenders and contracts. |
| Return of Earnings (ROE) | Annual declaration of total employee earnings, used to calculate your assessment (premium) for the year. |
| Assessment | Your annual premium payment, calculated as a percentage of total employee earnings based on your industry risk class. |
| COID Number | Your unique registration number with the Compensation Fund, used for all correspondence and claims. |
Who Must Register?
Every employer in South Africa who employs one or more workers must register with the Compensation Fund. This includes:
- Private companies (Pty Ltd)
- Close corporations (CC)
- Sole proprietors with employees
- Partnerships
- Non-profit organisations with employees
- Trusts with employees
- Government departments (provincial and local)
Who is Exempt?
- Domestic workers in private households – Covered under the Unemployment Insurance Fund (UIF) instead
- Members of the South African National Defence Force
- Members of the South African Police Service
- Workers covered by a licensed mutual association (e.g., Federated Employers Mutual for certain industries)
Letter of Good Standing
The Letter of Good Standing (LoGS) is a certificate issued by the Compensation Fund confirming that your business is registered and has submitted all required Returns of Earnings and paid all assessments.
Why You Need It
Tender Submissions
Required for virtually all government and parastatal tenders. Without it, your bid will not be considered.
Contract Requirements
Many private sector contracts, especially in construction and mining, require proof of COIDA compliance.
Legal Protection
Proves you're compliant with labour law. Non-registration is a criminal offence with penalties.
Employee Claims
Your employees can only claim compensation if you're registered. Unregistered employers face personal liability.
How to Get Your Letter of Good Standing
Ensure All Returns Are Submitted
You must have submitted all outstanding Returns of Earnings (ROE). If you have any missing returns, submit them first before requesting the letter.
Pay All Outstanding Assessments
All assessment payments must be up to date. Check your account for any outstanding amounts and settle them before applying.
Request Online via CompEasy
Log into the CompEasy system at compeasy.labour.gov.za and request your Letter of Good Standing. If compliant, it's issued immediately as a PDF.
Download and Use
Download the PDF and include it with your tender submissions. The letter is valid for 12 months from the issue date.
Registration Process
New employers must register with the Compensation Fund within 7 days of employing their first worker.
Documents Required
The employer registration form, available online or at Labour offices.
CIPC registration certificate (CM29) or trust deed.
Certified copies of directors'/members' ID documents.
Business address confirmation (utility bill, lease agreement).
Bank confirmation letter for payment verification.
How to Register
Online Registration (CompEasy)
Visit compeasy.labour.gov.za and follow the new employer registration process. You'll need to create an account, complete the forms, and upload supporting documents.
In-Person at Labour Office
Visit your nearest Department of Employment and Labour office with all required documents. They'll process your registration and issue a COID number.
Annual Return of Earnings
Every registered employer must submit a Return of Earnings (ROE) annually, declaring the total earnings paid to all employees during the previous year. This is used to calculate your assessment (premium) for the current year.
Key Deadlines
| Period | Deadline |
|---|---|
| Financial year | 1 March to 28/29 February |
| ROE submission deadline | 31 March each year |
| Assessment payment deadline | Within 30 days of receiving assessment |
What to Include in Your ROE
- Total earnings (gross wages before deductions)
- Number of employees
- Industry classification code
- Details of any workplace accidents during the year
- Changes to business operations or address
How to Submit Your ROE
Calculate Total Earnings
Add up gross earnings for all employees for the year (1 March to end of February). Include wages, salaries, bonuses, overtime, and benefits.
Log into CompEasy
Access your account at compeasy.labour.gov.za using your COID number and password.
Complete the ROE Form
Enter your earnings figures and employee numbers. Verify your industry classification is correct.
Submit and Pay
Submit the form and you'll receive your assessment amount. Pay within 30 days to remain in good standing.
Assessment Rates & Payments
Your COIDA assessment (premium) is calculated as a percentage of your total employee earnings. The rate depends on your industry classification and claims history.
How Rates Are Determined
- Industry class: Higher-risk industries (construction, mining) pay higher rates than lower-risk industries (office work).
- Claims history: Employers with many claims may face increased rates (merit/demerit system).
- National average: Rates are reviewed annually based on overall claims experience.
Example Assessment Rates (2024/2025)
| Industry Category | Typical Rate Range |
|---|---|
| Offices, retail, professional services | 0.11% - 0.50% |
| Manufacturing, light industry | 0.50% - 1.50% |
| Construction, transport | 1.50% - 3.50% |
| Mining, heavy industry | 3.50% - 8.00% |
Claiming Compensation
When an employee is injured at work or contracts an occupational disease, they're entitled to claim compensation from the Compensation Fund. As the employer, you must report the incident.
Employer Responsibilities
All workplace accidents must be reported to the Compensation Fund within 7 days of occurrence.
The employer's report of accident form, providing details of the incident and injured employee.
Ensure the employee sees a doctor and obtain medical reports.
Maintain records of all workplace accidents for at least 3 years.
What Employees Can Claim
- Medical expenses: All reasonable medical treatment costs
- Temporary disability: 75% of earnings while unable to work
- Permanent disability: Lump sum or pension based on degree of impairment
- Death benefits: Pension to dependants if fatality occurs
COIDA for Tender Submissions
A valid Letter of Good Standing is a non-negotiable requirement for most government tenders. Here's what you need to know:
What Evaluators Check
Must be current (issued within last 12 months) and not expired.
Company name and registration number must match your tender documents.
Some tenders require original letters; others accept copies.
Best Practices for Tenderers
- Request a new Letter of Good Standing at the start of each quarter
- Keep digital copies readily available for tender submissions
- Set calendar reminders 30 days before expiry to request renewal
- Verify your company details are current before each request
- If using a FEM letter, ensure it's accepted by the procuring entity
Common Problems & Solutions
My Letter of Good Standing shows outstanding amounts
This means you have unpaid assessments or penalties. Log into CompEasy, view your account statement, identify the outstanding amounts, and pay them. After payment clears (usually 3-5 business days), request a new letter.
I can't log into CompEasy
Use the “Forgot Password” function. If that doesn't work, contact the Compensation Fund helpline at 0860 105 350 or email cloakroom@labour.gov.za with your COID number to reset your access.
I have missing Returns of Earnings
Submit the outstanding ROEs before requesting a letter. You may need to estimate earnings for past years if records aren't available. Penalties may apply for late submissions.
My industry classification is wrong
Request a reclassification through CompEasy or by writing to the Compensation Fund. Provide evidence of your actual business activities. This can significantly affect your assessment rates.
I've changed business name or address
Update your details in CompEasy immediately. You'll need supporting documents (CIPC amendment, new lease agreement). Failing to update can cause issues with your Letter of Good Standing.
Federated Employers Mutual
Some industries are covered by Federated Employers Mutual (FEM), a licensed mutual association, instead of the Compensation Fund. FEM is particularly common in:
- Iron, steel, and engineering industries
- Motor industry
- Electrical contracting
- Textile industry
- Certain manufacturing sectors
FEM Contact: www.fem.co.za | Tel: 011 359 4300
Frequently Asked Questions
How long is a Letter of Good Standing valid?
Letters of Good Standing are valid for 12 months from the issue date. However, they only reflect compliance status at the time of issue. If you fall into arrears, a new letter won't be issued until you're compliant again.
Do I need COIDA registration if I only have one employee?
Yes. COIDA applies to all employers with one or more employees, regardless of how many hours they work or whether they're full-time or part-time.
Can I backdate my COIDA registration?
No. You cannot backdate registration, but you can register now and submit returns for past years. Penalties may apply for late registration and outstanding returns.
What if I have no employees currently?
If you previously had employees but now have none, submit a “nil return” for the current year. You must remain registered unless you formally close the business.
Is COIDA the same as UIF?
No. COIDA covers workplace injuries and diseases. UIF (Unemployment Insurance Fund) covers unemployment, maternity leave, and illness not related to work. Both are required for employers.
What happens if I don't register?
Non-registration is a criminal offence. You can be fined or imprisoned. Additionally, if an employee is injured, you'll be personally liable for all compensation costs, which can be substantial.
Related Resources
CompEasy Portal
Online registration, ROE submission, and Letter of Good Standing requests.
compeasy.labour.gov.zaCOIDA Act (Full Text)
Compensation for Occupational Injuries and Diseases Act 130 of 1993.
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