What happens to my UIF contributions if I resign?

Before You Hit Send on Your Resignation Letter

Contents

South Africans contribute 1% of their income to the Unemployment Insurance Fund (UIF) with the knowledge that when they lose their job, there is some recourse. With some recent changes to this benefit and the confusion that surrounds it, it is important to know that many of the rules still apply.

Those who are unclear with these rules may land themselves in hot water when they rely on these payments and can’t make ends meet due to some technicality.

The Conditions for UIF to Pay Out

Standing in the queues to register for unemployment benefits only to get to the consultant to get rejected, adds insult to injury.

To avoid this, citizens are recommended to know their rights and adhere to the guidelines. The South African Government provides clear guidelines for the unemployed to follow. Also, the conditions for payment are equally clear.

When An Employer Terminates A Contract

This is possibly one of the most important aspects of UIF. The fund is not in place for those who wish to test the waters on their own before heading on to the next job.

It’s specifically designed to act as a buffer between jobs when employees had no other option but to leave their company. The employer terminating the contract is one of them, however, this also has its restrictions.

Those Who Contribute To the Fund

Although the fund is initiated by the Government, it still requires the South African workforce to contribute. Currently, the contributions are at 2% of the worker’s income. The employer contributes 1% and the employee contributes 1%. Those who find themselves between jobs but have not contributed to the fund will have no grounds to claim benefits.

Employees Who Are Not Eligible To Claim

The list of those who can’t claim is quite extensive, and once again the Government website provides all the answers.

Those who can’t claim include:

Workers who already claim benefits from the Compensation Fund

Those who claim benefits under the Labour Relations Act

Workers who were suspended due to fraud

Have quit their jobs

Do not report at the dates and times set for them

Finally, if they refused further training and advice from their employers

What About Those Who Have to Quit their Jobs?

Although there is a resounding “no” to the question as to whether employees can claim UIF benefits if they quit, there are some mitigating instances where this is allowed. The fund is designed to protect the worker and when there are material changes to their personal or work conditions, these need to be honoured. Workers who find themselves forced to quit their jobs can approach the Commission for Conciliation, Mediation, and Arbitration for help. The following are some of the instances where workers have grounds to claim unemployment benefits from the UIF.

Material Changes to the Work Conditions

These changes could include factors such as a change of location of the employer or changes in the work contract that make the conditions less favourable to the worker. Additionally, this could include a reduction in pay or even an increase in costs that prevent the worker from maintaining their personal standards.

Other work conditions that could make it tough for workers to remain with an employer include workplace discrimination, harassment, unsafe work conditions, or even those who are forced to quit in lieu of discharge, such as a forced retirement.

Personal Changes that Could Affect the Worker

Domestic circumstances are one of the main personal reasons that workers find themselves forced to quit. These circumstances could include medical reasons or even family illness. Domestic violence and spousal moves are also listed as reasons workers may have grounds to claim.

Those who are considering the move should consult the rules and restrictions of the fund first before making the move. Many workers don’t realise that they can only claim from the fund a number of times and that there is a ceiling. Industry experts and local government publications should be checked before making a lifetime decision.

For instance, the benefit can only be claimed for a maximum of 34 weeks, depending on how long they’ve contributed to the fund. They also need to register for these benefits within six months of the termination.