(lump sum) consequences for not paying uif contributions

Here Are Consequences For Not Paying UIF Contributions

UIF contributions – consequences for not paying to the fund. The Unemployment Insurance Fund basically serves as a security to applicants and beneficiaries when they go on maternity leave or are unemployed.

Contributing to UIF is very essential to the extent that nobody knows when a man shall fall since life is full of uncertainties.


The South African labour department initiated this keen policy to reduce the rate of unemployment and high dependency rate in the country.

That notwithstanding, the policy also provides relief to people who are not able to work due to maternity leave, loss of job, parental leave, adoption leave, illness and other factors.

Important Links On UIF Benefits

Failure of employees and employers to pay their quota to the Unemployment Insurance fund isn’t just against the law, however, workers who might deem relief when the need be might be overburdened when the standard of living becomes tight along the line.

It’s always necessary to pay your contributions to the UIF in other to avoid any repercussions fast forward.

uif contributions
uif contributions

In our earlier posts, we highlighted several factors in relation to UIF of which you may find some links in this post to keep yourself abreast with any information regarding the Unemployment Insurance Fund.

In this post, we will delve much into the consequences one may face in failure to pay his/her contribution to the fund.

Frequently asked questions as far as UIF is concerned will be tackled as well in the post.

What are the Consequences for not Paying UIF Contributions

According to the deputy director of compliance at the UIF, the failure of employers to pay UIF contributions to its workers could lead to the employer being charged with penalties and interests.

Also, if employers are found to be non-compliant, they will be served with a notice of undertaking or order of compliance.

After the employer has been served with the aforementioned notices, a 14-day ultimatum is given to the employer after which the case will be referred before the labour court for prosecution provided the employer refuses compliance.

The following are some frequently asked questions (FAQs) on the consequences of not paying UIF contributions

Is it Compulsory to Pay UIF Contributions?

Yes, it is compulsory to by law to register and pay UIF contributions for your employees only if you have employed people for to work more than 24 hours per month.


Does UIF Money Expire?

There is no expiry date for your UIF contributions. UIF can be claimed after 12 months provided you have your full credit days. The credit days are pegged at 4 days of which you will receive one out of the 4 days subject to 12 months.

Can an Employee Refuse to pay UIF?

No, the law governing the Unemployment Insurance Fund does not give only the employer the share to pay its contribution, but rather the employee needs to pay as well.

Do Casual Workers Pay UIF Contributions?

Yes, casual workers pay UIF contributions. As the law says, any worker who works more than 24 hours within a month is entitled to pay his/her UIF contribution.

Does UIF Pay if Your Contract is Terminated?

It’s a big yes, UIF pays if your contract is terminated or cancelled. This is because if you had been paying your contributions to the fund as you worked, UIF will pay you out only if your credit days are due for payout.

That is working more than 24 hours a month for 12 months.

Has the South African Government Increased the UIF Contributions?

Yes, the government through the Minister for Finance has increased the Unemployment Insurance Fund. The monthly maximum remuneration has been increased from R14,87 to R17, 712.

Other Important Links On UIF benefits

We have enlightened you via this post on the consequences an employer or employee might face if he/she refuses to pay its contribution to the UIF.