COIDA’s New Era: From Payouts to Real Return‑to‑Work – What Employers Need to Know

Why these COIDA amendments matter now

The Compensation for Occupational Injuries and Diseases Amendment Act, 2022 (Act 10 of 2022) fundamentally shifts COIDA from a narrow compensation scheme to a broader rehabilitation, reintegration and return‑to‑work framework, with key provisions kicking in from 1 February and 1 April 2026. For employers, this is no longer only about reporting accidents and paying assessments – it is about proactively getting injured and ill employees back to safe, sustainable work or facing sharper compliance and financial consequences.

Rehabilitation, reintegration and return to work: a new statutory duty

For the first time, COIDA now defines rehabilitation and builds an integrated regime around it. Rehabilitation covers clinical, vocational, and social measures designed to reintegrate employees back into work and enable them to regain maximum physical, mental, social, and vocational ability, with full inclusion and participation in life, “where reasonable and practicable.”

This is reinforced by a new statutory duty on employers to facilitate rehabilitation and reintegration of workers who have sustained occupational injuries or diseases. In practice, this means employers cannot simply terminate for incapacity once the statutory benefits start flowing; they must be able to show active steps such as appropriate medical management, graded return‑to‑work plans, modifications to duties, assistive devices, or retraining to place the employee in suitable alternative work where reasonably possible.

The Compensation Fund is also empowered to conduct rehabilitation assessments, with “assessment” now expressly including assessment of an employee in relation to rehabilitation under the new Chapter VIIA. This anchors a much more robust interface between fund processes and workplace incapacity management, and employers who support temporary disability rehabilitation may even qualify for assessment rebates under the new administrative penalty regime.

Incapacity due to ill health: how the COIDA changes reshape the process

These changes have direct consequences for how incapacity due to ill health or injury is handled in internal employment law processes. Traditional incapacity enquiries under the Labour Relations Act focused on whether the employee can perform their duties, with some consideration of alternatives; the amended COIDA now adds a statutory rehabilitation and return‑to‑work overlay that will become a reference point for what “reasonable” employer efforts look like.

In an incapacity process after a compensable injury or disease, employers will increasingly be expected to demonstrate that they have:

• Engaged with Compensation Fund recommendations and rehabilitation assessments, rather than ignoring them.

• Considered temporary adaptations (reduced hours, light duty, work‑from‑home arrangements where appropriate) as part of a phased return‑to‑work.

• Explored vocational rehabilitation options, such as retraining and redeployment into alternative roles, particularly where permanent disablement is below the pension threshold but still impacts original job performance.

• Taken mental health and PTSD‑related functional limitations seriously, not only obvious physical restrictions.

A termination for incapacity in the face of these new obligations, without evidence of genuine rehabilitation and reintegration efforts, is more likely to be challenged as substantively and procedurally unfair – and it will be harder to defend to an inspector or in the Labour Court, given COIDA’s explicit shift to a return‑to‑work model.

Extended coverage: employer transport, training events, and the end of “misconduct” exclusions

The scope of what counts as “in the course of employment” has quietly but significantly widened. The amended Act clarifies broader cover for injuries sustained during work‑related training and while travelling in employer‑provided transport, meaning incidents at employer‑organised training events or in company‑provided or arranged vehicles are more clearly compensable.

This has strategic implications:

• Employer‑provided transport: Injuries on the way to or from work in employer transport can now more readily be accepted as accidents arising out of and in the course of employment, increasing exposure for industries like mining, agriculture, security, and logistics that regularly transport employees.

• Training and off‑site events: Accidents during training sessions, induction programmes, off‑site workshops, or simulations will sit squarely within COIDA, prompting the need for tighter risk assessments, venue safety checks, and clear codes of conduct.

At the same time, the deletion of the definition of “serious and wilful misconduct” – previously tied to exclusions for intoxication or reckless breaches of safety law – signals a decisive move away from denying benefits on misconduct grounds. Compensation may now be payable even where an accident is linked to the employee’s serious misconduct, reinforcing the no‑fault character of the system but raising the stakes for employers in terms of safety management, disciplinary processes and potential premium impact.

For incapacity management, this means that even where misconduct and injury coincide (for example, an intoxicated employee injured while misusing equipment), the injury remains compensable and the employer must still navigate both discipline and rehabilitation/return‑to‑work obligations in parallel.

PTSD, mental health and the new focus on psychological injury

One of the most striking changes is that post‑traumatic stress disorder (PTSD) is now explicitly listed as an occupational disease. This formal recognition shifts psychological injury from the margins to the mainstream of occupational health and safety, particularly for sectors with high exposure to trauma, such as healthcare, security, law enforcement, emergency services, transport and financial crime investigations.

Because “occupational disease” is now defined to include PTSD, an employee who develops PTSD from a workplace incident – for example, an armed robbery, fatal motor vehicle accident in employer transport, serious industrial accident, or repeated exposure to traumatic material – can claim compensation and access rehabilitation under COIDA. This dovetails with the new rehabilitation definition, which expressly contemplates mental and social rehabilitation alongside physical and vocational elements, requiring employers to address mental wellbeing as a core component of their return‑to‑work programmes.

In practice, employers will need to:

• Integrate trauma debriefing, counselling and appropriate psychiatric care into post‑incident response protocols.

• Train managers and supervisors to recognise signs of PTSD and other mental health conditions and to refer employees early.

• Reflect psychological risk in their hazard identification and risk assessments (HIRA), especially where employees are exposed to violence, fatalities, or disturbing content as a regular part of their duties.

• Ensure incapacity enquiries for mental health conditions are informed by appropriate clinical evidence and aligned with the Compensation Fund’s PTSD recognition and recommended rehabilitation plans.

The explicit statutory acknowledgment of PTSD also strengthens the link between COIDA and broader workplace mental health initiatives – making it harder for employers to treat mental wellbeing as a “soft” issue rather than an occupational risk with direct legal and financial consequences.

Compliance, penalties, and strategic actions for employers

The compliance architecture around these new obligations is tightening. Inspectors appointed by the Commissioner now have express powers to conduct workplace inspections, issue compliance orders and pursue enforcement through the Labour Court where employers fail to comply with COIDA requirements, including those relating to rehabilitation and reintegration.

From 1 April 2026, an administrative penalty regime will replace certain criminal offences, with penalties applying where employers fail to:

• Report accidents correctly and on time.

• Pay the first three months of temporary disability compensation.

• Refrain from unlawful deductions from employees.

• Keep employment and earnings records for at least five years.

Crucially, employers that actively support employee rehabilitation for temporary disabilities may qualify for an assessment rebate, effectively rewarding organisations that treat return‑to‑work as a core compliance and risk‑management function. Given that the prescription period for claims has been extended from 12 months to three years, employers will need to maintain robust data and documentation over longer periods to defend decisions and demonstrate compliance.

Strategic steps employers should consider now include:

• Reviewing and updating workplace policies on occupational injuries, incapacity, and return‑to‑work to reflect the new statutory language and duties.

• Mapping high‑risk areas where employer transport and training events are routine, and tightening safety controls and supervision.

• Embedding structured rehabilitation and RTW plans into HR and OHS processes, including standard templates and checklists.

• Building partnerships with multidisciplinary rehabilitation providers who can address physical, vocational and psychological needs, including PTSD.

• Training HR, line managers and health and safety representatives on the amendments and on how to manage the intersection between COIDA, incapacity procedures and mental health.

As these provisions come into full effect through 2026, employers that embrace rehabilitation, reintegration and mental wellbeing as part of their core operational responsibilities – rather than viewing COIDA as a distant statutory obligation – will be better positioned to manage legal risk, control costs and retain experienced employees after injury or illness.

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