Extending coverage of the unemployment insurance-system in South Africa

Dupper, Ockert ; Olivier, Marius ; Govindjee, Avinash (2010-02)

CITATION: Dupper, O., Olivier, M. & Govindjee, A. 2010. Extending coverage of the unemployment insurance-system in South Africa. Stellenbosch Law Review = Stellenbosch Regstydskrif 21(3):438-462.

The original publication is available at https://journals.co.za/content/journal/ju_slr

Article

The scope of the Unemployment Insurance Act (UIA) is narrow as it continues to exclude the atypically employed (particularly independent contractors, so-called dependent contractors and those who are self-employed or informally employed), public servants, learners, and certain categories of migrant workers from its purview. Given the vulnerable position of these groups, it is arguable that South Africa should, as a matter of principle, broaden the scope of coverage to include them. While the importance of including all the currently excluded groups cannot be denied, it is acknowledged that it will not be financially feasible to include all of the groups at once. In prioritising the groups most urgently in need of inclusion, two important factors are taken into consideration. Firstly, the exclusion of certain groups may be vulnerable to constitutional challenge. The exclusion of, in particular, public servants and migrant workers fall into this category. This article proceeds from the standpoint that priority should be given to the inclusion of those currently excluded from the UIA where the exclusion raises concerns of a constitutional nature. Secondly, including some groups may possibly have no or negligible financial impact on the financial viability of the Fund, and their inclusion should therefore be supported. In this regard, the return of contributions to undocumented migrants, the inclusion of learners and the inclusion of the partially unemployed come to mind. However, this article also recognises that some of the recommendations made may have a significant impact on the solvency levels of the Fund, and that it may not be possible to accommodate all of them immediately. This relates in particular to the introduction of unemployment benefits to employees who resign to take care of children or to care for a terminally ill family member (the so-called “carer’s benefit”).

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