Should You Apply for a Learnership While Waiting for UIF? What About Your UIF Payments?
Everyone goes through a stressful period whenever they lose a job or must adjust to a new career. The Unemployment Insurance Fund (UIF) offers some relief to the unemployed in South Africa by paying out benefits to qualified persons. While waiting for your UIF benefits, you might consider the option of a learnership which is a combination of theoretical training and practical work experience.
One of the most frequently asked questions during this period is, “Can I enroll in a learnership while my UIF is pending? Will it stop my UIF payments?”
We will analyze these questions and examine the implications a learnership may have on your finances and career, especially during the UIF waiting period.
Understanding UIF and Its Purpose
If you’re wondering what UIF stands for and what it’s for, then you’re in the right place. Based on our national laws, the UIF is there to assist those that have worked in positions for which UIF contributions were made and have lost such jobs. The UIF fund is not meant to serve as an income. The fund is there to assist you for a limited time as you actively seek employment or find ways to re-enter the job market.
However, to protect the integrity of the presentation, it’s essential to state that UIF is there to assist those that are truly unemployed and not earning an income. If you take a job, even if it’s a self-employment, or a paid internship, you must declare that to UIF. Ignoring that obligation is breaking the law and could result in a penalty, paying the UIF back, or losing the explanation altogether.
What is a Learnership?
A learnership is a training program with a balance of theoretical classroom training and practical training or work experience in a field. These qualifications are supposed to make people more employable. These vocational training programs are generally paid for by the SETA (Sector Education and Training Authorities).
These learnerships can be:
For unemployed people training for a job and getting paid a stipend instead of a salary.
For employed people allowing them to retrain for another job while getting paid for the work they already are doing.
For unemployed people getting a learnership SETA payment is usually just a stipend for basic necessities. The stipend is generally SETA dependent and the level of the qualification in question.
Can you apply for a learnership while waiting for UIF?
There are Rules preventing a person waiting for UIF from applying for a learnership. Waiting for UIF is a good time to apply for a learnership. This positive activity can be motivated for a person waiting for UIF with the added benefit that the person may obtain a permanent work opportunity.
The important point is when you actually commence the learnership and not simply when you submit your application. Your UIF benefits won’t be affected by simply applying for or being accepted into a learnership. The concerns come into play when you start the learnership and begin to earn a stipend.
What will happen to your UIF benefits when you start a Learnership?
At this stage Read both the terms of your learnership and the conditions of your UIF claim.
1.If the Learnership Provides a Stipend
Receiving a stipend means you are earning income. Even under the UIF Act, stipend income equates to a salary. To be eligible for UIF unemployment benefits, claimants need to be unemployed and earning no income.
Thus:
You need to inform UIF when you start earning a stipend.
Your UIF payments are likely to be cut off the day you start earning a stipend.
If you do not report this to UIF and continue to claim payments, you will be asked to pay the excess funds you received.
Remember, UIF staff, do check your employment status or your training. They will ask the SETAs or the sponsor of your learnership. Be open about it to avoid trouble.
2. If the Learnership Is Unpaid
Learnerships, especially in case of smaller organizations or NGOs, are not guaranteed to offer a stipend. In these cases, you are still, technically, unemployed.
If you are not making any money and can show proof of documentation that the learnership is indeed unpaid, you can still claim your UIF benefits while participating in the learnership. However, you must notify the UIF office in writing, and you should receive proof that your involvement will not affect your claim.
What Happens to Your UIF Benefits When You Start a Learnership?
At this point, you need to assess both the conditions of your learnership and the conditions of your UIF claim.
1. If the Learnership Provides a Stipend
Receiving a stipend means you are earning income. Even under the UIF Act, stipend income equates to a salary. To be eligible for UIF unemployment benefits, claimants need to be unemployed and earning no income.
Thus:
You need to inform UIF when you start earning a stipend.
Your UIF payments are likely to be cut off the day you start earning a stipend.
If you do not report this to UIF and continue to claim payments, you will be asked to pay the excess funds you received.
Remember, UIF staff, do check your employment status or your training. They will ask the SETAs or the sponsor of your learnership. Be open about it to avoid trouble.
2. If the Learnership Is Unpaid
Learnerships, particularly with smaller organizations or NGOs, may not provide stipends. In those cases, you are still, in essence, unemployed.
If you are not earning income, and you have proof that the learnership was unpaid, you can collect UIF benefits while on the learnership. But the UIF office must be notified in writing, and you must confirm that your actual participation does not affect your claim.
What Happens When You Start a Learnership and You Have UIF Benefits?
In this case, you must compare your claim conditions and learnership working conditions.
If the Learnership Provides a Stipend
Receiving a stipend means you are earning income. Even under the UIF Act, stipend income equates to a salary. Therefore, to qualify for UIF unemployment benefits, claimants must be unemployed and earning no income.
This, means, you must inform UIF whenever you start earning a stipend.
Your UIF payments will probably be cut off effective the day you start earning a stipend.
If you do not inform UIF and continue to receive payments, you will be required to pay back the excess you received.
Note, UIF employees do verify your employment status or training. They will be getting this info from the SETAs or your learnership sponsor. Disclose everything to avoid complications.
If the Learnership Is Unpaid
Some learnerships, especially with smaller organizations or NGOs, will not always offer a stipend. In these cases, you are Still Unemployed.
If you are not earning any income, and you can prove the learnership is unpaid, you may receive UIF benefits while participating.
Nevertheless, you need to send the UIF office a notice in writing, and you ought to get a response stating that your participation will not impact your claim.
Balancing UIF and Career Development
If you are mainly living off your UIF to cover your basic necessities, it makes sense to be cautious about going on a learnership that pays less than the UIF. Usually, UIF payments are more stable in the short-term than a small stipend.
However, if you can afford it (and/or your UIF payment is hanging in limbo), joining a learnership could be a positive step towards rebuilding your career and getting on with your life.
The critical thing to do is:
1. Check the stipend before you accept.
2. Inform the UIF where your income status changes.
3. Document all communications in your interactions with UIF and the learnership.
Being completely transparent about your situation will help ensure that at the end of the process you comply with UIF’s rules and are in a position to have any disputes concerning money from the UIF settled.
How do I Inform UIF about my learnership?
To remain compliant, you should contact the nearest Department of Employment and Labour office (or simply use the UIF online portal – uFiling) and advise them. The information to provide will be:
– the name of your learnership
– the start date of your learnership
– the stipend amount (if applicable)
– the name of the SETA or the company that is delivering the learnership
The UIF will then make a determination concerning your case and issue a notice to tell you whether your benefits will be extended or suspended. In most circumstances, once you start making income payments, you should not be making UIF claims.
Conclusion
You are welcome to apply for a learnership while waiting for UIF benefits, and you should experiment with filling your time while waiting. You are being proactive and productive while waiting, so don’t let the prospect of the UIF be a barrier to applying for development opportunities. You should be aware, however, that as soon as you enter a learnership and/or earn any stipend or income, your UIF will likely be negatively impacted.
This change may not be a bad thing in relation to your financial situation. The UIF serves as a temporary form of assistance, while a learnership serves as an opportunity to earn a skill or qualification and get into sustainable work. The financial hit you may experience as you transition from receipt of UIF should not deter you from pursuing a new skill for long-term employability and independence.
Finally, the only thing you really need to consider now, as soon as you enter into a learnership or conditional engagement (receiving a stipend or salary), is to be honest with them and manage your expectations about what can happen next. None of that matters; investing in your learning and employability now means a better and more sustainable future for you – in the long-term.