Pertinent Changes To The Unemployment Insurance Amendment Act, 2016

Pertinent Changes To The Unemployment Insurance Amendment Act, 2016

What is Unemployment Insurance Fund?

The Unemployment Insurance Fund has been established to provide short-term relief to workers, subject to certain conditions, when they become unemployed, or are unable to work because of illness, maternity or adoption leave and also to provide relief to the dependants of deceased contributors.

The Unemployment Amendment Act, 2016 is due to promulgated shortly and it will extend Unemployment Insurance benefits to learners who are undergoing learnership training and civil servants and will extend a contributor’s entitlement to benefits under certain circumstances.

This Act applies to all employers and employees, other than employees employed for less than 24 hours a month with a particular employer, and their employers.

This Act does not apply to members of parliament, cabinet ministers, deputy ministers, members of provincial executive councils, members of provincial legislatures and municipal councillors.

  • A contributor employed in any sector who loses his or her income due to reduced working time, despite still being employed, is entitled to benefits if the contributor’s total income falls below the benefit level that the contributor would have received if he or she had become wholly unemployed, subject to that contributor having enough credits.
  • Maternity benefits must be paid at a rate of 66% of the earnings of the beneficiary at the date of application.
  • A contributor’s entitlement to benefits accrues at a rate of one day’s benefit for every completed five days of employment as a contributor subject to a maximum accrual of 365 days benefit in the four year period immediately preceding the day after the date of ending of the period of employment.
  • Unemployment benefits must be paid to the unemployed contributor regardless of whether or not the contributor has received benefits within that four year cycle, if the contributor credits.
  • The application for benefits must be made within 12 months of the termination of the contract of employment.
  • A contributor is not entitled to illness benefits if the period of illness is less than 7 days.
  • A contributor who has a miscarriage during the third trimester or bears a still-born is entitled to a full maternity benefit of 17 to 32 weeks.
  • A contributor is not entitled to benefits unless she was in employment, whether as a contributor or not, for at least 13 weeks before the date of application for maternity benefits.
  • An application for maternity benefits must be made in the prescribed form at an employment office at any time before or after childbirth: Provided that the application shall be made within a period of 12 months after the date of childbirth.

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