A letter of good standing is the Compensation Fund confirming that you are registered as an employer and that your assessments are paid up. Clients and principal contractors ask for it before they let you on site, and the Construction Regulations make that a legal duty rather than a preference.
It is a certificate from the Compensation Fund, at the Department of Employment and Labour, confirming two things about your business: that you are registered as an employer under the Compensation for Occupational Injuries and Diseases Act 130 of 1993, and that your assessments are paid up to date.
The phrase “letter of good standing” does not appear in the Act itself. It is the administrative name for the Fund confirming a status the Act creates. That distinction matters when you are chasing one: nobody can issue it to you except the Fund, and the Fund will only issue it once the underlying obligations are actually met.
Anyone who employs people and wants to work on someone else’s site. In practice the request comes from a client or a principal contractor before you are allowed to start, and it is usually attached to a tender, a site access process or a vendor onboarding pack.
On construction work this is not just commercial habit. Regulation 5(1)(j) of the Construction Regulations 2014 places a duty on the client to ensure that every principal contractor is registered and in good standing with the compensation fund, or with a licensed compensation insurer, as contemplated in the Compensation for Occupational Injuries and Diseases Act. The client is legally exposed if they let you start without it, which is why the request is rarely negotiable.
Three sections of the Act sit behind the letter.
| Section | What it requires |
|---|---|
| Section 80 | An employer must register with the Commissioner and furnish the particulars the Act asks for. Registration is the starting point — without it there is no status for the Fund to confirm. |
| Section 82 | An employer must furnish returns of earnings. This is the annual Return of Earnings submission. The Fund sets the submission window each year and has extended it more than once, so check the current dates with the Department of Employment and Labour rather than assuming last year’s. |
| Section 83 | The Commissioner assesses the employer, and the assessment becomes payable. An outstanding assessment is the most common reason a letter does not come through. |
There is a fourth section worth knowing if you subcontract. Section 89 deals with mandators and contractors, and it is the reason a principal contractor cares whether the people working under them are registered in their own right.
If the letter is refused or delayed, the cause is almost always one of the three above rather than the request itself. Work backwards through registration, then returns, then payment, and you will usually find it.
Treat it as a time-limited document. The letter states its own validity period, and a client checking your paperwork will look at that date rather than at when it was issued. Because the status it confirms can lapse the moment a return or an assessment falls behind, it is worth renewing well before a tender deadline rather than on the day you need it.
A letter of good standing confirms that you are paying into the compensation system. It says nothing about whether the people on your site are competent to do the work. Those are two separate columns on the same site access checklist, and a client will ask for both.
The training side comes from the Occupational Health and Safety Act 85 of 1993 rather than from COIDA. Sections 8 and 13 require an employer to provide a safe system of work and the information, instruction, training and supervision to go with it. On a construction site the Construction Regulations 2014 add duties on top of that. The two most common gaps a site access audit turns up are certificates that have expired and certificates from a provider whose accrediting body nobody can name.
Send us the roles on your site and we will tell you which certificates a client is likely to ask for against each one, and what it costs to get them current. We train at your premises anywhere in South Africa, or at our Mokopane centre.
Training for employers| What a client asks for | Where it comes from | Where to sort it |
|---|---|---|
| Letter of good standing | COIDA sections 80, 82 and 83; Construction Regulations 2014 regulation 5(1)(j) | Compensation Fund |
| Health and safety file | Construction Regulations 2014 regulations 5(1)(s) and 7(1)(b) | Compliance |
| Appointed and trained safety representatives | OHS Act sections 17, 19 and 20 | SHE Representative |
| A certified first aider on shift | General Safety Regulations regulation 3 | First aid courses |
| People able to use the fire equipment | Environmental Regulations for Workplaces regulation 9, with OHS Act sections 8 and 13 | Fire fighting courses |
| Fall protection for work at height | OHS Act sections 8 and 13; Construction Regulations where they apply | Working at Heights |
| Operators certified on the machine they run | OHS Act sections 8 and 13 | Machine operator courses |
No. Only the Compensation Fund issues them, and only once you are registered under section 80, your returns of earnings are in under section 82 and your assessment under section 83 is paid. What we do is the training that sits next to it on the same site access checklist — safety appointments, first aid, fire, working at height and machine tickets.
The duty to register under section 80 attaches to being an employer. If you genuinely employ nobody, speak to the Compensation Fund about your position rather than assuming either way, because clients will still ask for the letter and you will need something to show them. Get the answer from the Fund in writing.
Almost always one of three things: you are not registered with the Fund, a Return of Earnings is outstanding, or an assessment has not been paid. The letter confirms registration and payment, so anything unresolved on either blocks it. Work back through registration, then returns, then payment.
No, and this catches people out. The letter is about the compensation system under COIDA. Health and safety compliance comes from the Occupational Health and Safety Act 85 of 1993 — safe systems of work, trained employees, appointed representatives, first aid and fire provision. A client can accept your letter and still turn your team away at the gate over expired certificates.
Both, from different directions. You carry the duty to register and pay under COIDA. On construction work the client carries a separate duty under regulation 5(1)(j) of the Construction Regulations 2014 to ensure every principal contractor is registered and in good standing. That is why the client asks, and why they will not usually waive it.
