The moment you employ one worker, even part-time, you must register with the Compensation Fund under COIDA. In return, if a worker is injured or killed on the job the Fund pays compensation and you cannot be sued personally. The proof that you are compliant is the Letter of Good Standing (LOGS), and on most commercial and government sites the rule is blunt: no LOGS, no site access.
Who must register
The Compensation for Occupational Injuries and Diseases Act 130 of 1993 covers every employer with one or more part-time or full-time workers. A sole proprietor with no employees is exempt. Mining and certain building employers fall under Rand Mutual Assurance (RMA) instead of the Compensation Fund, so confirm your sector's scheme.
A warning that bites in construction: if a subcontractor is not COIDA-registered, its workers are deemed workers of the main contractor, and the main contractor carries the assessments. That is why principal contractors demand a current LOGS from every subbie before anyone sets foot on site.
How to register
Register online via the Department of Employment and Labour at labour.gov.za, or submit form W.As.2 at your nearest Labour office. You will need your company registration certificate (CoR14.3), director ID copies, proof of business address, tax clearance, bank details and a payroll estimate (see Registering Your Business with CIPC for the upstream paperwork).
What it costs: the assessment
The annual assessment formula is: total annual payroll divided by 100, multiplied by your assessment tariff rate. The tariff depends on your industry class, and construction sits in a higher-risk class than office work. The class tariff is gazetted annually and the construction figure is typically quoted in the 0.7% to 2.5% range, but do not budget on a number until you have the current gazette from the Department; the rate is not something to guess.
Two parameters are fixed for planning:
- Maximum earnings counted per employee: R668,000 for 2026/27 (it was R633,168 for 2025/26). Pay above the cap is ignored in the calculation.
- Minimum assessment for a commercial employer: R1,621. Even a tiny payroll pays at least this.
The Return of Earnings (ROE)
Every registered employer files an annual Return of Earnings (the W.As.8) declaring actual earnings for the year just ended (March to February) and an estimate for the year ahead. The filing window runs from 1 April to 30 June each year. You may still find older advice saying "by 31 March"; that is out of date, the window opens on 1 April. The Fund then issues an assessment notice, payable within 30 days. The COIDA Amendment Act changes that commenced in early 2026 also introduced new 10% penalties, so late filing now costs real money.
The Letter of Good Standing
Once registered and paid up, you can request a LOGS: official proof of compliance, issued free by the Department once your assessed contributions are settled. Apply online, by email to your provincial office, or at a Labour Centre. Service providers will do it for you for roughly R600 to R1,500 or more, which buys convenience, not a better letter. In practice the LOGS follows the ROE cycle, so renew it each year as soon as your ROE is filed and the assessment paid.
Without a current LOGS you are barred from most commercial and government sites, your tender submissions are rejected (see Tenders 101), and any main contractor who lets you on site is taking on your COIDA liability.
Worked example
Thabo runs a plastering Pty Ltd with 3 workers earning R8,000 a month each. Annual payroll is 3 x R8,000 x 12 = R288,000. Using an illustrative building-works tariff of 1.5% (illustrative only; check the current gazette), the assessment is R288,000 divided by 100 times 1.5 = R4,320 a year. That exceeds the R1,621 minimum, so the formula applies. Thabo files his ROE in the 1 April to 30 June window, pays within 30 days of the assessment notice, downloads his LOGS, and can tender and work on any government project.
Common mistakes
- Not registering because workers are "casual". One part-time worker triggers the duty.
- Missing the ROE window. File between 1 April and 30 June; late filing now attracts a 10% penalty.
- Letting the LOGS lapse mid-contract. Sites check expiry dates; renew with your ROE every year.
- Using unregistered subbies. Their workers become yours for COIDA purposes.
- Budgeting on a guessed tariff. The class rate is gazetted annually; get the real number.
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