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Unemployment Insurance

I am the one in ten
A number on a list
I am the one in ten
Even though I don’t exist
Nobody knows me
Even though I’m always there
A statistic, a reminder
Of a world that doesn’t care1

Thus go the lyrics of the chorus from one of the best known hits of Britain’s most famous pop/reggae band, UB 40. The song, One in Ten, is a reference to the unemployment statistic in Britain in the early 1980’s when the band’s popularity was nearing its height. The band takes its name2 from the form used to register for the ‘dole’ (Britain’s unemployment benefit) namely Unemployment Benefits Form 40. The cover of the band’s first album Signing Off is a replica of that form, and the name of the record indicated that the band was, well, signing off from, or ending, their individual claims for unemployment benefit.

In South Africa, whilst there are social welfare grants, what is referred to as unemployment insurance, works in a slightly different way. The ‘dole’ is like our social welfare grant system, whereas our ‘UIF’ (as it is commonly known) is a fund to which employers and employees contribute and from which employees who become unemployed (or their beneficiaries) are entitled to benefits.

The Unemployment Insurance Act 20013 falls under the authority of the Minister of Labour. It covers a variety of benefits in addition to unemployment: illness, maternity, adoption and dependants are included.

A. UIF officials and employees

  1. Any person who discloses information obtained in the performance of any functions contemplated in the Act commits a criminal offence.4 5

  2. If you make a false entry on the record card of a contributor (or on any other book or document relating to his employment history, or his claim for benefits) you commit a crime.6

B. False and misinformation

  1. It is a crime to make a statement in an application for benefits (or cause one to be made) which you know is false.7

  2. It is also a crime knowingly to make a false statement which results in an incorrect payment of benefits.8

  3. It is an offence if you fail to inform the claims officer should you resume work during the period in respect of which benefits were being paid.9

C. General

The Act provides that it is a criminal offence to ‘contravene, or refuse or fail to fully comply with any provision’ of the Act.10 Because the Act establishes entitlements to various benefits, and the procedures that are to be followed, not many provisions address prohibited conduct. Nevertheless, what is set out hereunder is a listing of the more likely provisions intended by the Legislature to carry criminal sanction if contravened.

  1. Contributors or dependents who have been paid benefits that they are not entitled to, or have been paid benefits in excess of their entitlement, must repay such benefits to the Fund with 90 days of a written demand from the Unemployment Insurance Commissioner to do so.11

  2. A labour inspector who has reasonable grounds to believe that an employer has not complied with any provision of this Act may issue a ‘compliance order’. An employer must comply with this order within the period stated.12 13

  3. An employer must ensure that every statement or other information which must be kept, or submitted, is correct.14

  4. Every employer must, as soon as it commences activities as an employer, provide:
    • the street address of its business, and any of its branches;15
    • if the employer is not resident in the Republic, or is a body corporate not registered in the Republic, include the particulars of the authorised person who is required to carry out the duties of the employer;16
    • include the names, identification numbers and monthly remuneration of each of its employees;17 and
    • state the address at which the employee is employed.18
  5. Every employer must, before the seventh day of each month, inform the Commissioner of any change during the previous month in any information so furnished.19

  6. The Commissioner may request the employer to provide such additional particulars as may reasonably be required to give effect to the purpose of the Act. The employer must do so within 30 days of the request, or within such extended period as the Commissioner may allow.20

  7. Failure to pay moneys due (or to make regular payments) to the Commissioner in terms of the Act (or the Unemployment Insurance Contributions Act) is an offence.21

  8. Failure to comply with a duty imposed by the Act leading to loss or damage to the fund is an offence.22
  1. The chorus from the song on the band’s second album, ‘Present Arms’. 

  2. At the time of writing, a passing off action is on the go in England’s High Court about the rights to the name. Three former members of the 9-piece band left, continuing to call themselves UB40, whilst the original band still exists. Oops. 

  3. As amended; the latest amendments are effected by Act 20 of 2016. 

  4. Unless the disclosure is authorised in terms of the Act – See section 63(1). 

  5. Section 63(2) read with section 63(1). 

  6. Section 64(1)(b) read with section 64(2). 

  7. Section 64(1)(a) read with Section 64(2). 

  8. Section 64(1)(a) read with section 64(2). 

  9. Section 61(1)(b). 

  10. Section 64(1)(c). 

  11. Section 35(1) and (4). 

  12. Unless the employer follows the objection route in terms of section 40. 

  13. Section 38(1) read with section 39(1), (2) and (4). 

  14. Section 42. 

  15. Section 56(2)(a). 

  16. Section 56(2)(b). 

  17. Section 56(2)(c). 

  18. Section 56(2)(c). 

  19. Section 56(3). 

  20. Section 56(4). 

  21. Section 61(1)(a). 

  22. Section 61(1)(d).