DEPARTMENT OF LABOUR UNEMPLOYMENT INSURANCE FUND UI Act ... · • To provide for a 66% fixed rate of the payment of maternity benefits. ... the act will now make provision for employees

DEPARTMENT OF LABOUR

UNEMPLOYMENT INSURANCE FUND

UI Act Amendments

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UI ACT

Operates on insurance principles

Provides defined contributions & benefits

Governed by two Acts (UIA & UICA)

Program within Department of Labour

Accounting Authority

Purpose: To provide effective short-term unemployment insurance to all

workers who qualify for unemployment and related benefits.

The UI Fund : Director General

Managed by UIC & Answerable to UIF Board and Parliament

Adjudication of Claims: Appointment of Claims Officers

2002: New legislation & subsequent Amendments introduced

AMENDMENTS

• The Intention of the UIF Amendments

In order to improve service delivery by the Fund, the Unemployment

Insurance Board decided to recommend the Act should be amended.

The amendments to the Act need to address the issue of workers who are

presently excluded in the Act and by so doing to conform with the

International Labour Organization standards;

Improve payment of benefits to contributors; and extend the period within

which benefits are payable.

To comply with the Constitution of the Republic of South Africa, the Act

had to address the exclusion of the civil servants in the legislation.

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The proposed amendments to the Act deal with a number of

issues namely:

a) Section 3

Include employees on a learner ship and public servants

only 2 exclusions

• Employees working less than 24 hours

• Members of Parliament, Cabinet, ministers, etc.

b) Section 5

To make provisions for the refinancing of the unemployment

insurance beneficiaries to facilitate re-entry into the labour market.

Amendments to the Act

Amendments continued…

c) Section 12

• Providing for the payment of benefits to contributors who lose

part of their income due to reduced working times,

• To provide for a 66% fixed rate of the payment of maternity

benefits.

• Pay the first 238 days at a rate between 38 – 60% and then from

239 to 365 days at a flat rate of 20%

1) the act will now make provision for employees on short time

2) maternity benefits will be paid on a flat rate of 66%, and the

sliding scale will not apply to maternity benefits

3) Between 239 to 365 days will be paid at 20%

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Amendments continued…

• Section 13(3)

Credits are calculated at a rate of 1:4 in a four year cycle from the date of

unemployment upto a maxcimum of 365 days

Credits claimed in the 4 years preceding the date of application will be

subtracted, except in the case where there was a maternity claim in the

last 4 years

• Section 14

This section in the Act has been deleted. Contributors are entitled to

benefits while in receipt of benefits from COID or any other

Unemployment fund established by a bargaining or statutory council

Amendments continued…

f) Section 17

The period is extended from 6 months to 12 months to apply for

unemployment benefits

g) Section 20

To provide that a contributor is entitled to illness benefits if the

days of illness are less than seven days

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Amendments continued…

h) Section 24

– A contributor who had a miscarriage in the 3rd trimester is

also now entitled to maternity benefits for the full period

– A contributor must have worked at least 13 weeks before

the date of application.

i) Section 25

A contributor can apply any time before or after the

childbirth, provided application is made within 12

months after childbirth.

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Amendments continued

j) Section 30

– Extending a period in which the dependents may apply for

benefits on behalf of the deceased from six months to 18

months.

– Section 30 is further amended by the insertion of a new

provision allowing contributors to nominate their

beneficiaries in cases of death benefits.

k) Section 33

Prohibiting any agency or a person purporting to be acting on

behalf of the applicant to charge any fee against the applicant.

(UIF services are free and currently the Agencies charges

claimants money to assist them in lodging claims on their

behalf)

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Amendments continued…

l) Section 56

– Employers must now declare all their employees before the

7th day of every month

– The minister will issue regulations on special dispensation

applicable to domestic employers and small businesses or

enterprises regarding the submission of information in

subsection 3

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Thank You…

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