RETURN OF EARNINGS (ROE): A SMALL FORM WITH BIG CONSEQUENCES

In South Africa, every employer registered with the Compensation Fund is legally required to submit an annual Return of Earnings (ROE) under the Compensation for Occupational Injuries and Diseases Act (COIDA). This statutory obligation goes beyond mere paperwork — it plays a critical role in protecting employees from workplace injuries and illnesses, while ensuring businesses remain compliant and financially accurate.

Understanding the Return of Earnings

The ROE is essentially an annual declaration submitted by employers detailing two key pieces of information:

• The actual total earnings paid to employees during the previous financial year (referred to as the assessment year).

• The projected payroll for the upcoming financial year (known as the provisional year).

These figures form the basis for calculating the employer’s annual assessment fee, which funds the Compensation Fund. This fund is the safety net that guarantees compensation to employees injured or made ill through their work.

For the 2024/2025 assessment year, the period runs from 1 March 2024 to 28 February 2025, while the provisional year is from 1 March 2025 to 28 February 2026.

Why ROE Submission Matters

Compliance with the ROE submission requirement is critical for several reasons:

1. Legal Compliance

   Failure to submit the ROE on time or submitting inaccurate data can trigger penalties, interest charges, and even legal audits. Non-compliance also risks reputational harm and could delay or invalidate employee claims for compensation.

2. Employee Protection

   Only employers who submit an accurate ROE can ensure their employees are properly covered by the Compensation Fund, safeguarding their rights to compensation in the event of work-related injuries or diseases.

3. Financial Precision and Risk Assessment

   The information submitted helps determine a fair assessment fee based on total remuneration and the business’s risk classification. This ensures employers are neither overcharged nor underreporting payroll, which could have legal repercussions.

Key Earnings Thresholds and Assessment Fees

The draft Government Gazette dated 31 March 2025 sets the following parameters for the 2025/2026 financial year:

• Maximum earnings for the 2024/2025 actual year: R597,328

• Maximum earnings for the 2025/2026 provisional year: R633,168

• Minimum assessment fee: R1,621 (an increase from R1,530)

Employers must use these thresholds to calculate their assessment fees accurately.

Preparing for Submission

Before submitting the ROE, employers should gather essential details such as:

• COIDA registration number

• Total number of employees, including part-time and temporary workers

• Complete payroll figures, including salaries, bonuses, overtime, and taxable allowances

• A description of the nature of operations for accurate industry risk classification

• Projected payroll for the upcoming year

Regularly reviewing the risk classification code is advised since changes in business operations may require updates to avoid incorrect fees.

Submitting the ROE

ROE submissions are made online through the Compensation Fund’s official e-portal: https://cfonline.labour.gov.za

The submission window typically opens in April and closes on 30 June 2025. Early submissions are encouraged to prevent system bottlenecks and late penalties.

Consequences of Non-Compliance

Non-submission or inaccurate ROE filings can lead to:

• Rejection or invalidation of injury-on-duty (IOD) claims

• Suspension of the employer’s Letter of Good Standing, which is often required for tendering and vendor vetting

• Financial penalties, interest, and potential loss of contracts requiring COIDA compliance

The Letter of Good Standing

Upon submitting the ROE and settling the assessment fee, employers can request a Letter of Good Standing. This document certifies compliance with COIDA and is frequently necessary for participating in tenders, passing labour inspections, and vendor evaluations.

Without a valid ROE submission, this letter cannot be issued, potentially restricting business opportunities.

Compliance Is More Than a Legal Requirement

Submitting the ROE is not simply a regulatory formality but a reflection of an employer’s dedication to employee welfare and ethical business practices. Accurate and timely ROE submission protects workers, ensures compliance, and safeguards your company’s reputation and business continuity.

In the words of many compliance experts, “Compliance isn’t just about law—it’s about people.” 

Make sure your company’s ROE is submitted on time and with precise data — it’s a small task with significant impact.