UIF & Disability
The Unemployment Insurance Fund (UIF) exists to provide financial support to workers who have lost their jobs or are unable to work due to illness, injury, or maternity leave.
The UIF is a vital social safety net that helps to alleviate poverty and reduce the economic impact of unemployment on individuals and their families. By providing a temporary income replacement, the UIF enables workers to maintain a basic standard of living while they seek new employment or recover from illness or injury. The UIF also plays a critical role in promoting social justice and equality by protecting the rights of vulnerable workers, including domestic workers, farmworkers, and workers in the informal sector.
How it works
Contributions: Employers and employees contribute 1% of the employee's monthly earnings to the UIF.
Fund Administration: The UIF is managed by the South African Department of Labour.
Benefit Disbursement: Benefits are paid to eligible claimants.
Unemployment Benefits: Provides financial assistance for up to 34 weeks (238 days) to workers who
- Lost their job due to retrenchment, closure, or downsizing.
- Resigned due to ill health or domestic reasons.
- Completed a fixed-term contract.
Disability Benefits: Offers financial assistance to workers
- Permanently or partially disabled.
- Unable to work due to disability.
Illness Benefits: Provides financial assistance for up to 238 days for workers
Incapacitation due to illness or injury, Undergoing medical treatment.
Financial Support Amount
36% to 60% of the worker's average monthly earnings (depending on the number of dependents).
Maternity Benefits: Financial assistance for up to 121 days (17 weeks) for female workers
On maternity leave, Adopting a child.
Adoption Benefits
Financial assistance for up to 121 days (17 weeks) for adoptive parents.
Illness Benefits
Financial assistance for up to 238 days for workers incapacitated due to illness or injury, Undergoing medical treatment.
Dependent's Benefits
Financial assistance to dependents of deceased workers.
Disability Benefits
Financial assistance for workers who are permanently or partially disabled, Unable to work due to disability.
Promotes Social Security & Economic Stability
Provides a safety net for workers, reducing poverty and inequality.
Helps maintain economic stability by supporting consumer spending and reducing the burden on families and communities.
Encourages workers to seek medical attention and rehabilitation, promoting overall well-being.
Encourages Job Search and Re-employment
Job Search Allowance: A monthly allowance for up to 6 months to support job search efforts.
Training and Upskilling: UIF partners with training institutions to provide skills development programs.
Career Counseling: UIF offers career guidance and job placement services.
Re-employment Incentives: UIF provides financial incentives for workers who find employment within a specified period.
Additional Initiatives:
- UIF's Labour Activation Programme (LAP): Provides training, mentorship, and entrepreneurship support.
- UIF's Small Business Development Agency (SBDA) partnership: Offers business training and funding.
What UIF covers
Temporary or permanent unemployment, Maternity or adoption leave, Illness or injury, Disability, Death (dependent's benefits)
UIF Benefits upon Death
Eligible Dependents: Spouse, life partner, children (biological or adopted), parents, or other relatives financially dependent on the deceased.
Benefit Amount: A lump sum payment or monthly installments, calculated based on the deceased's UIF contributions.
Benefit Duration: Varies depending on the dependent's age and relationship to the deceased.
UIF Payout upon Death:
Lump Sum Payment: The UIF pays out a lump sum to the dependents, calculated based on the deceased's contributions.
Monthly Installments: Dependents may receive monthly payments for a specified period.
Factors Affecting UIF Payout
Length of UIF Contribution: Longer contribution period results in higher benefits.
Age of Dependents: Benefits may vary depending on the dependent's age.
Relationship to Deceased: Benefits may differ based on the relationship (e.g., spouse, child).
What UIF does NOT cover
Voluntary resignation, Retirement, Self-employment, Freelance or consulting work, Part-time or temporary work (unless contributed to UIF), Workers earning above the UIF contribution threshold (currently R14,874 per month), Domestic workers (unless voluntarily registered), Foreign nationals (unless permitted to work in South Africa).
UIF Eligibility Criteria
- Be a South African citizen or permanent resident.
- Have contributed to the UIF for at least 12 months.
- Be registered with the UIF.
- Meet specific benefit requirements (e.g., unemployment, maternity).
Disability Grant vs Disability Cover (Life Cover)
Disability Grant via Government payout. To qualify, you must:
- be a South African citizen or permanent resident or refugee and living in South Africa at the time of application
- be between 18 and 59 years old
- not be cared for in a state institution
- have a 13-digit, bar-coded identity document (ID)
- not earn more than R86 280 if you are single or R172 560 if married.
- not have assets worth more than R1 227 600 if you are single or R2 455 200 if you are married
- undergo a medical examination where a doctor appointed by the state will assess the degree of your disability
If you have a physical or mental disability which makes you unfit to work for a period of longer than six months, you can apply for a disability grant from the government.
You get a permanent disability grant if your disability will continue for more than a year and a temporary disability grant if your disability will last for a continuous period of not less than six months and not more than 12 months.
A permanent disability grant does not mean you will receive the grant for life, but that it will continue for longer than 12 months.
How much will you get
The maximum is R2 180 per month.
When may your grant be suspended
When your circumstances change, the outcome of a review, if you fail to co-operate when your grant is reviewed, when you commit fraud or misrepresent yourself or if there was a mistake when your grant was approved.
The grant will lapse when you
Pass away, are admitted to a state institution, do not claim for three consecutive months or you are absent from the country.
Disability Cover | Life Insurance
Disability cover compensates you if you cannot work and earn an income because of an illness or injury.
It provides for expenses that occur because of the disability suffered, for example, alterations to your car or home or covering medical expenses that your medical aid may not cover. It isn't just about planning for the worst to happen. It's a positive step toward protecting your financial future.
Life cover gives you peace of mind that your loved ones will be financially provided for in the event of your death.
If your employer offers Group Life Cover, it is important to find out if this cover includes Disability.
Should you not have this benefit, do consider getting it but keep in mind that the Disability element of a cover greatly inflates the cost. Always ensure that you have sufficient Life Cover, it is crucial and often overlooked with devastating consequences. Visit the Life Cover vs Funeral Cover page as well as the Group Life Cover page to better understand the benefits.
Disability Grant
Disability Grant
If you have a physical or mental disability which makes you unfit to work for a period of longer than six months, you can apply for a disability grant.
You get a permanent disability grant if your disability will continue for more than a year and a temporary disability grant if your disability will last for a continuous period of not less than six months and not more than 12 months. A permanent disability grant does not mean you will receive the grant for life, but that it will continue for longer than 12 months.
Read the South African Government article HERE
Disability cover
Disability cover protects your biggest asset – your ability to earn an income. Disability cover is a vital benefit in your life insurance portfolio. It financially protects you against the risk of permanently losing your income if you suffer an illness or injury and covers the extra costs of living with the disability.
Read the Momentum article HERE