Thousands of South African Post Office workers could be without medical aid cover from next month after the entity repeatedly failed to pay employee medical scheme contributions to Medipos.

An internal communique sent to Post Office employees by the company’s human resources (HR) department, advising them to take out their own medical aid cover to avoid being without protection has been seen.

The South African Post Office (Sapo) reportedly owes Medipos over R700 million in medical aid contributions that were deducted from staff’s salaries but never paid to the scheme.

The notification follows numerous meetings between Sapo, Medipos, and organised labour to try and resolve the issue of outstanding contributions — the last of which was held on 21 September 2022.

Medipos notified scheme members at the end of August 2022 that it would suspend their benefits should it not receive outstanding contributions from Sapo within 30 days.

According to Sapo’s HR department, the entity cannot make the outstanding payment.

“The SA Post Office cannot make this payment due to severe financial challenges and recommends that employees seek alternative medical cover, until the Medipos matters are resolved,” the HR department wrote.

Sapo said it has repealed a restriction on medical aid choices, allowing members to use their preferred provider.  It also said employees could consider hospital plans or medical insurance.

The Post Office said the health and welfare of employees were “vital” to the company and that it was doing “everything possible” considering its financial challenges.

“Sapo is concerned that should the benefits be suspended, employees would be left with no medical cover.”

Sapo has been defaulting on medical aid contribution payments since mid-2020, following a downturn in foot traffic at its branches due to the Covid-19 pandemic.

Medipos previously threatened to suspend employees’ benefits in October 2021.

However, after court action by trade union Solidarity, it reached an agreement with the Post Office to pay the outstanding amounts in monthly instalments.

Solidarity’s head of legal affairs, Anton van der Bijl, told MyBroadband the Post Office initially made the payments but stopped after a few months.

Post Office employees who are members of Solidarity will keep their cover after the trade union took legal action against the entity, forcing it to pay R3 million to Medipos last week.

Solidarity has also approached the courts to force the Post Office to pay the outstanding contributions of other employees.

Van der Bijl said that Sapo was ignoring its statutory obligations and putting the lives of members suffering from serious diseases in danger.

“South African state institutions and corruption are synonymous with each other, but here people’s lives are threatened through the abusing of taxes,” he stated.

“Those in charge of enterprises in the public sector are disregarding their employees’ rights and lives while they run these institutions into the ground.”

MyBroadband asked the Post Office for feedback on the communication and asked whether it would continue deducting medical aid contributions from the salaries of employees who would decide to take up alternative medical cover.

It did not respond by the time of publication.

The Post Office has also defaulted on payments amounting to hundreds of millions of rand to members’ pension funds, employee income tax meant for Sars, and UIF payments, all of which it seemingly deducted from salaries but never paid over.

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