Newsletter - August 2022
Welcome to New Employers
A very warm welcome to all new employers who accepted our invitation and came to meet the BIBC Production Team to be introduced to the services we offer, in our new Client Services Centre. We wish you well with your new business as we enter the 4th and final quarter of this benefit year.
This newsletter is sent out periodically to the industry to share important information relating to the administration of employee benefit funds and other matters of concern to employers. Older newsletters are archived and can be accessed on our website at www.bibc.co.za under the ‘News’ tab.
If you have a change in personnel or would like a refresher on BIBC administrative processes, please email
New BIBC IT System and Processes
The IT system that is currently in use to administer employee benefit funds and manage dispute prevention and dispute resolution services, is no longer fit-for-purpose. For this reason, a process was started in 2021 to analyse the current system in relation to the needs of the organisation. Proposals were solicited from software providers and the process of development of a new system was started. At the time of writing this communication, 70% of the work has been done which is also on schedule as per our detailed project plan and agreed project milestones. The new system will ‘go live' on 01 November 2022 at the start of our next benefit year.
There are several employees on our system with outdated information. As we move over to the new system, we have an opportunity to update all information. We would appreciate it if you could assist your employees with updating their information on the appended Employee Registration Form. They need to sign the completed form and return it to
Decommissioning of Old IT System: Implications
As the new IT system comes online and the old system is decommissioned simultaneously, employers are asked to please take extra care this year with submissions and payment references. We will not be able to process any late and incorrect submissions as the payments in lieu of the 2022 financial year (ending 31 October 2022) needs to be finalised in the old system so that this can be audited, and the balances brought into the new system.
Payout December 2022: Important dates and information
Thank you to the many employers who submit their correct documents on time each month and who meet the payment deadline. We can plan our resources carefully when correct documents are sent by the due date and corresponding, properly referenced payments reflect in our bank account. Do take extra care to ensure that all employee information is up to date, especially bank details.
Bank Details and Benefit Statements on WhatsApp
Remind your employees that they can download their Benefit Statements by the 20th of each month for the previous month on WhatsApp, and they will see the bank details that are captured on their profile. Employees should be encouraged to save the BIBC WhatsApp number 021 950 7400 and start the process by sending a message e.g., ‘Hi’ or ‘Hello’, to the BIBC WhatsApp number. A menu will be displayed after the employee’s identity is confirmed by the system, and the employee will be able to download the benefit statement and perform additional processes on that platform.
Unregistered Employees
The BIBC has no way of communicating with employees who have been included on returns but who have not been registered. Unregistered employees are therefore also not included in the holiday pay-out. The cooperation of employers in this regard makes sure that we don’t turn away distressed employees who arrive at our offices after employers have already closed their offices for the year, and who are then also uncontactable.
FNB e-Wallets
Employees who do not have bank accounts will be issued an e-Wallet account at a cost of R30.25 for both the initial and replacement card which is the 2022 administration fee charged by the bank. E-Wallet accounts are active for 3 (three) years from the date of issue.
Important dates for Pay-out 2022
- The cut-off date for correct documents and payments to reflect in the BIBC bank account in lieu of October, is 7 November. All correct documents and payments reflected in the BIBC bank account by 7 November (in lieu of October) are guaranteed to be processed.
- We will be opening our offices from 08h00 to 11h00 on Saturday 05 and 19 November to assist with updates to banking details prior to the start of the pay-out
- All correct employer returns and payments received by 7 November will then have been finalised and the old system will be closed for further processing.
- The Main Pay Run is on 12 December
Employers who are up to date with current benefits may however select any date between 6 and 14 December for their employees to be paid their holiday pay. If no date is selected, employees will be in the Main Pay Run along with all former employees.
- The BIBC will only have 2 full days i.e., 19 and 20 December, within which to address queries after the final pay-out date. Depending on the nature of the query, these may only be resolved in January 2023.
- BIBC offices close at mid-day on 02 December and 21 December 2022, and we open on 16 January 2023 at 08h00.
Late and incorrect submissions and payments
As of this year’s holiday pay-out and going forward, we are no longer able to guarantee that late and incorrect documents and unidentified deposits (no reference number) will be processed before our offices close. Extremely late submissions with multiple returns for previous months are also not guaranteed to be processed from this year. Where we have additional capacity to process late submissions, we will try our best. Otherwise, late submissions can unfortunately only be processed when the BIBC offices open in January 2023, for payment of correct documents and payment received, by 31 January 2023.
Process changes 01 November 2022: Automated allocation of payments
Proportional Benefits: In line with previous communications sent to employers by the Principal Officer of the BIBC Industry Retirement Funds (Pension Scheme and Provident Fund), retirement fund benefits and interest on late purchasing of these benefits are prioritised for payment. This ensures that employees are protected from risk events (e.g., disability and death) and that their funds are invested promptly. Thereafter, any interest must be recovered as per the instructions of the Financial Services Conduct Authority (FSCA). What this means is that from 01 November 2022, whatever is receipted by employers will be distributed to the funds, as follows:
- Retirement Funds
- Interest on late purchase of Retirement Funds
- Administration costs for adjustments to previous returns affecting Retirement Funds
- Outstanding debt not resolved
- The balance of the payment is distributed to:
- Holiday Fund
- Bonus Fund
- Sick Fund
- Medical Aid Fund
Employers must settle all outstanding debt (arrears, interest, arbitration costs, fines, and penalties for late purchases, etc.) before the implementation of this new process. BIBC staff is on hand to assist you with any questions you may have in this regard. If you are unsure of whether you have a debit balance on your account, do not hesitate to contact our Dispute Prevention team at
Builder’s Holiday Dates 2022/3
The Builder’s Holiday ends on 15 January 2023 and employees return on 16 January 2023. This means that there are unpaid days in the schedule. The full illustration of paid and unpaid days and paid public holidays is appended to this document.
No Exemptions application required
Employers who would like to delay or return to work earlier than the published Builder’s Holiday dates will not need to apply for an exemption if the following provisions are met:
- There is a written agreement between the employer and
- Employees take at least 10 days during the holiday
Exemption application required
Employers who agree with their employees in writing to work completely outside of the holiday period must apply for an exemption. The required form is available on the BIBC website and is also appended to this document. Send an application form with supporting documents to
Dispute Prevention and Resolution Services: Important dates
Dispute prevention and resolution services are available until 15 December 2022. Arbitration awards and dispute prevention and resolution processes that were not finalised by this date will be deferred to January 2023.
Main Collective Agreement
01 November 2022 to 31 October 2025
The parties to Council entered into negotiations this year and reached a new 3-year Agreement on the new terms and conditions of employment in the industry. The Main Collective Agreement was subsequently submitted to the office of the Minister of Employment and Labour. The administrative process followed by that office will determine when further information on the new Agreement will be available.
Errors and Adjustments Cost
The Pension Fund Administrator imposes an administration fee when employers make errors on returns and then submit adjustments. The BIBC has been absorbing these additional administration costs. This is no longer feasible, especially as there are large employers who routinely make multiple adjustments for a number of employees on previous returns submitted and already processed. As of the date of this communication, these costs will be passed on to the employer. What this means is that, before returns for the month following the error, administration costs will be recovered first and paid over to the administrator.
Please ensure that administrators are made aware of these costs and that care is taken to compile and submit accurate returns to avoid both the additional costs and the loss of investment income to the member of the fund.
Website
As we work towards presenting the new system for testing by employers who kindly agreed to test the new system with us, we are also looking forward to launching the new BIBC website which will be easier to navigate and have a much more modern look.
Employer Portal
As an improvement on the efficiency of our systems, employers will have access to their own Employee Benefits portal. Returns can be submitted directly from the portal, giving employers access to their previous submissions and employee information.
Do look out for communications that will be sent to you with your registration and log-in access to your portal. Training material will also be sent to you with an option to attend system training at our Bellville office.
Audited Financial Statements for the 2021 financial year have been submitted to the DoEL and are available on our current website.
“Two-Pot" Retirement Rules
After many years of consultation, Treasury has finally published proposed new legislation that will establish a “two-pot” retirement system in SA.
The reform is meant to prevent South Africans from cashing out their retirement savings when resigning from their employment. South Africans will also be able to save for emergencies via their retirement funds. This will help them to preserve their savings for retirement. The proposed legislation will allow members to preserve their retirement savings by making it more flexible to accommodate unforeseen pressures that members face during the span of their working life.
The member’s retirement contributions will be restructured into two pots. The one pot can be accessed at any time, whereas the other pot will not be accessible before retirement and must therefore be preserved until retirement. One-third of all future contributions will go into the accessible pot and the other two-thirds will go into a pot that must be preserved until retirement. The new proposal will mean that a member of a retirement pension or retirement provident fund, will be able to make one withdrawal in any 12-month period. Withdrawals of less than R2 000 will not be allowed.
Comments from industry players are currently being called for and the management of the Building Industry Pension/ Provident Funds will revert to members, once this new legislation has been approved.
Pearl Pugin: CEO Danie Hattingh: Principal Officer
Building Industry Bargaining Council Building Industry Pension/ Provident Funds ( WP )
Payment of Funeral insurance benefits in the absence of a beneficiary nomination form
Sanlam Group Risk (SGR) is endorsing existing unapproved group life and funeral policies to remove employer, trustee or committee discretion in the determination of beneficiaries for claim payments. This effectively means that death and funeral benefits will be paid to the member’s nominated beneficiary/ries or alternatively into the estate of the deceased member should the member have failed to nominate one or more persons to receive the benefit.
The payment of the funeral benefit into the member’s estate late is however especially problematic because, as indicated in the Insurance Act, the intention of funeral policies is to cover costs associated with a funeral or the rendering of a service on the happening of a death event. Payment into the estate late will result in the family’s immediate need to pay for the member’s funeral costs not being met due to considerable delays in settling the estate.
This also creates additional complexity if one considers that Rule 2A.8.1 of the Policyholder Protection Rules (PPRs) indicates that funeral claims must be paid within two business days after all required claim documents have been received by the insurer. In turn, Rule 2A.10.1 of the PPRs does allow the claimant to instruct the insurer to pay the funeral benefit directly to a service provider of the claimant’s choice, but the PPRs are not clear on how the insurer should apply the distinction between claimant and beneficiary, namely whether the claimant and the beneficiary are the same person in the context of a funeral policy.
Various pension/provident-related associations are currently engaging with the Financial Sector Conduct Authority on behalf of insurers regarding these challenges in the case of funeral policies. The Board of Trustees of the Building Industry Pension/ Provident Fund strongly believes that members must be actively encouraged to nominate beneficiaries as required in terms of legislation.
In those exceptional cases where beneficiaries have however not been nominated, SGR will apply the practice of paying the funeral benefit to the person responsible for the member’s funeral costs or directly to the relevant funeral service provider, if so, directed by the claimant. This however is only an interim measure that will be reassessed as and when feedback is received from the regulator.
With the above mentioned in mind, the Board of Trustees of the Building Industry Pension/Provident Fund (WP) is reaching out to all employers in the building Industry to ensure that their records regarding their employees’ nominated beneficiaries are up to date and easily available should a claim arise.
Relevant forms are available: Employee Registration Form, Exemptions Application Form, and Builder’s Holiday Dates
