In the event that a worker becomes unemployed or is unable to work due to maternity leave, adoption leave, commissioned parental leave, parenting leave, or long-term illness, the Unemployment Insurance Fund provides short-term help in the form of financial assistance. The dependents of a dead contributor may also receive this help.
Benefits vs. Contributions
It’s critical to understand the difference between UIF benefits and contributions:
Contributions to the UIF: Amounts that the employer deducts from each employee’s pay stub and transfers to the Fund on the employee’s behalf.Benefits provided to individuals from the Fund during times when they are unable to work or are unemployed.
Contributions to UIF
UIF is computed as 2% of an employee’s pay divided equally between the employee and employer for UIF purposes.
For UIF purposes, compensation is defined as the employee’s compensation, less specific exclusions like commissions, and is restricted to an annual maximum of R17 712 per month. Therefore, the maximum UIF contribution for each party is R177.12 per month (or R354.24 overall)*. This cap will be divided throughout the pay periods for workers who get payments at more frequent intervals (such as weekly).
What basis does UIF calculation use?
Employers are required to withhold 1% of a worker’s gross compensation, excluding commissions, as the contribution. In addition to the 1% withheld from each employee, the employer also makes a 1% contribution for each employee they hire. Therefore, 2% is the entire contribution made to the UIF.
Does UIF make lump sum payments?
The money is typically distributed as a lump payment to the surviving husband or children. Depending on the deceased’s income and tenure of employment, the sum might be around R25 000.
How long does it take to receive UIF payout?
After the procedure is finished, the first payment will be paid to your bank account two to four days later.
