Claiming money from the UIF: Everything you need to know
- The Unemployment Insurance Fund has introduced a special new coronavirus benefit, aimed at workers affected by the pandemic crisis.
- Employers need to apply for the coronavirus benefit if they can't afford to pay their workers.
- The maximum amount recipients will get is R6 730 a month.
- For more stories, go to Business Insider's home page.
The coronavirus crisis and lockdown have paralysed businesses and left many in South Africa without an income.
Enter the Unemployment Insurance Fund (UIF), which should help those in the formal sector with some form of payment in this time.
Everyone who works more than 24 hours a week should contribute 1% of their income – deducted from their paychecks, and paid over by their employer - to the UIF.
Some 1.5 million companies in South Africa pay contributions to the UIF on behalf of their workers.
When a contributing worker becomes unemployed; is unable to work due to sickness; or go on maternity leave, they can claim benefits from the UIF. You can also claim if your employer decides to cut your hours (this is called the “reduced working time” claim).
Government has now also introduced a special new coronavirus benefit, aimed at workers affected by the pandemic crisis.
Here’s what you need to know about claiming in time of the coronavirus crisis:
Who can claim from the UIF at this time?
If you lost your job, you can claim an unemployment benefit from the UIF – and if your company reduced your working hours, you can also put in a claim.
But if your company put you on unpaid leave during this time, or if you have been laid off temporarily - or if a company can only afford to pay a part of your salary - you may get a special payout from the UIF, as part of the Covid-19 Temporary Relief scheme, also known as the special Temporary Employee/Employer Relief Scheme (TERS).
How does the new coronavirus benefit work?
A business has to apply to the UIF to get money to pay workers. It will have to prove that it suffered a severe knock from the lockdown. If approved, the UIF will pay out money per worker for up to three months.
Unlike normal UIF benefits, which is paid to workers, the money may be distributed first to the company, which will then pay workers. (This arrangement has not been finalised, though.)
And also unlike the normal UIF benefits, you don’t have to have enough “credits” with the fund to claim the money. The normal UIF rule is that that you could get one day’s payout for every four days’ work (up to certain maximums). But this falls away for the new coronavirus benefit. All workers at approved companies will get payments.
Businesses must have been registered with the UIF before the crisis started to qualify for the benefits.
How much will I get?
The amounts paid will be a percentage of an employee’s salary, according to a legislated sliding scale from 38% (highest earners) to 60% (lowest earners)
The maximum you will get is R6 730 a month. The sliding scale stops at R17 702: All workers earning more than this will only get the 38% maximum benefit (R6 730). The minimum amount will not be below the minimum wage (around R3 500).
It will work on the same principle as maternity benefits. If a company can still afford to pay employees a part of their salaries, the TERS money will “top up” these payments – but employees can’t earn more than 100% of their current salaries.
Currently, the Ters payment will cover the lockdown period of five weeks.
How do I claim UIF?
If you are unemployed or have had your hours reduced, you can claim directly from the UIF. The UIF offices are closed, but you can register online at https://www.ufiling.co.za/. From the home page, click on the 'Activate my uFiling account' button and follow the on-screen instructions. You will receive a case number to track your progress. Alternatively you can email Online.BCP@labour.gov.za for guidance.
For the coronavirus benefit, you can’t apply - your employer has to. Businesses have to apply online on the Ters platform to register their companies for the payout. The UIF hotline for the coronavirus benefit is 012 337 1997.
Confirm with your employer that they have registered – and if not, alert the department of labour and the UIF directly.
Recently, labour minister Thulas Nxesi made it clear that government will take a hard line if it found that companies who were not paying their workers, did not claim from the UIF under the new scheme.
“Workers should not be punished because of irresponsible employers,” Nxesi said, urging companies to take this option and soften the lockdown blow to staff.
When will you get the money?
Currently the turnaround time for payment on approved unemployment claims is 15 working days. The timeframe is not yet clear for the new benefits, but many companies have already been paid.
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- Claiming money from the UIF: Everything you need to know