THE UNEMPLOYMENT INSURANCE AMENDMENT ACT, 2016
02-02-2017

Over the years, the Unemployment Insurance Fund in South Africa has accumulated a huge surplus in financial reserves because revenue and investment returns have exceeded the benefits paid. 

Some of the surplus is currently used to fund poverty-alleviation schemes and socially responsible investments like housing, hospitals and student accommodation, as well as other investments that result in job-preservation and job-creation.

On 11 January 2017, President Zuma signed into law the long-awaited amendments to the Unemployment Insurance Act which are aimed at increasing the rate at which the Unemployment Insurance Fund (UIF) pays out benefits. The Unemployment Insurance Amendment Act also widens the categories of those who qualify for benefits.

Here are some of the changes included in The Unemployment Insurance Amendment Act, 2016:

- The period over which unemployment benefits are paid has been increased from 238 to 365 days

- UIF benefits have been extended to people in learnership training as well as to civil servants (under the old legislation, provincial and national public servants, including the police, were not entitled to UIF benefits)

- UIF benefits for pregnant women have been increased to 66% of their basic salary

- Employees may apply for maternity leave benefits eight weeks before delivery and up to 12 months after birth

- Payment of maternity benefits will no longer be deducted from the mother's unemployment insurance benefit

- Women who have suffered miscarriages during the third trimester or a still born birth may claim benefits

- Families and/or nominated beneficiaries of a deceased claimant will be allowed to receive the deceased’s benefits within 18 months of the death of the contributor

- Employees who have lost working hours due to reduced time at their work places, will be entitled to benefits

- The new legislation prohibits the charging of fees by any party to an Unemployment Insurance Fund (UIF) claimant

These changes to the Unemployment Insurance Act have been a long time in the making, but the new legislation will not only benefit thousands of unemployed workers, but also women going on maternity leave.