Issue: September 2012 / November 2012
Expert Opinion

RIGHTS AND WRONGS

Absa advises on pre-benefit medical screening and HIV/Aids

All rules, benefits, practices, procedures and decisions of a retirement fund must align to constitutional provisions and requirements under Section 9 of the Bill of Rights as expressed in the South African Constitution.

The Bill of Rights prohibits unfair discrimination. It provides that everyone has the right to the full and equal enjoyment of all rights and freedoms. The ‘limitation clause’ provides that a fundamental right may be limited only to the extent that such limitation is reasonable and justifiable in an open and democratic society based on human dignity, equality and freedom.

Therefore, it is reasonable for retirement funds to require pre-benefit medical screening and ensure limitations in respect of the risk benefits for employees affected by HIV/ Aids. This is to prevent healthy members’ retirement benefits being unfairly reduced to provide for the increased costs of the re-insurance premiums of risk benefits in respect of the HIV/Aids-affected members of a fund.

In terms of the Promotion of Equality & Prevention of Unfair Discrimination Act, no person may unfairly discriminate against another. In terms of the Equality Act, unfairly excluding any person from membership of a retirement fund or from receiving any benefits from the fund on one or more of the prohibited grounds is held to be an unfair pension practice.

It is not unfair for a fund to require pre-benefit medical screening and subsequently to limit an HIV/Aids-positive member’s right to benefit from entitlements under a fund based on the employee’s HIV/Aids status to limit costs, provided that all other members with other serious illnesses are limited with a similar process and criteria to benefits from the fund.

With reference to the Labour Relations Act, the test for the permissibility of differential treatment is the fairness test i.e. whether it is fair for an employer to limit its costs by limiting the employee benefits available to HIV-positive employees, by way of pre-benefit medical screening.

We believe an employer has to seek ways to reduce the risk of being required to pay high premiums for the benefitthat it offers, provided that all employees with HIV/Aids are treated in the same way as employees suffering from other serious illnesses.

A fund must ensure that it addresses a fair apportionment of benefits i.e. one that takes into account the actuarial limits of what can be provided for all members suffering from serious illnesses.

Therefore, as long as an employee’s right to privacy in respect of medical screening is maintained by a fund, the risk of unfair discrimination by the employer in respect of HIV/ Aids- affected employees can be avoided.

In June this year, the HIV/Aids Code was issued. One of its objectives is to promote access to equitable employee benefits. The code prescribes that employees with HIV/ Aids must not be unfairly discriminated against in the allocation of employee benefits.

The code further provides that HIV/Aids-affected employees must be treated no less favourably than employees with other serious illnesses in terms of benefits.

A member may never be totally excluded from all death benefits based on his or her HIV/Aids status and HIV/Aidsaffected members must be treated no less favourably by a fund than members with other serious illnesses (for example diabetes, heart condition, cancer, etc) in terms of benefits.

According to life offices’ guidelines, no claim for a lumpsum death or disability benefit will be denied by an insurer based on the HIV/Aids status of the insured person unless the policyholder is found guilty of material non-disclosure. The waiving of the exclusions does not apply to income-protector policies and policies requiring regular HIV retesting.