UIF Reduced Work Time Benefits: Short-Time and Reduced Hours
If your employer has reduced your working hours due to operational reasons such as a slowdown in business, you may be entitled to claim UIF benefits for the hours you are no longer working. This is called the Reduced Work Time (RWT) benefit and it allows workers to supplement their reduced income without the employer having to retrench them.
The RWT benefit protects both the employer (who retains experienced staff) and the employee (who receives income support). It is a useful alternative to retrenchment for businesses experiencing a temporary downturn.
What Is the Reduced Work Time Benefit?
The Reduced Work Time (RWT) benefit is a UIF benefit that supports workers whose hours have been reduced by their employer. Instead of retrenching workers, employers can place staff on short-time and have the UIF supplement the difference in earnings.
This benefit was significantly used during the COVID-19 pandemic through the TERS (Temporary Employer-Employee Relief Scheme) and remains available for qualifying employers facing economic pressure.
Who Qualifies for Reduced Work Time Benefits?
Both employers and employees must meet certain requirements:
- The employer must be registered with the UIF and up to date with contributions
- The reduction in working hours must be due to operational requirements (not disciplinary action or personal reasons)
- The reduction must result in a reduction in remuneration
- Employees must be UIF contributors
- The employer must apply on behalf of the employees (employees cannot apply individually for RWT)
How Is the Benefit Calculated?
The RWT benefit is calculated on the difference between the employee normal remuneration and their reduced remuneration. The UIF pays a portion of this difference, based on the employee IRR.
For example, if an employee normally earns R8,000 per month but is reduced to R5,000 due to short-time, the UIF benefit is calculated on the R3,000 shortfall.
| Normal Salary | Reduced Salary | Shortfall (monthly) | IRR | Approx. Daily UIF Benefit on Shortfall |
|---|---|---|---|---|
| R8,000 | R5,000 | R3,000 | 46% | R46.00 |
| R12,000 | R8,000 | R4,000 | 42% | R55.86 |
| R17,712 | R10,000 | R7,712 | 38% | R97.55 |
How Employers Apply for Reduced Work Time Benefits
For the standard RWT benefit, employers apply on behalf of their employees. The process is as follows:
- Confirm that the company meets the qualifying criteria (registered UIF employer, contributions up to date)
- Notify employees of the reduced working hours and obtain their written consent where required
- Log in to uFiling at www.ufiling.co.za or visit a labour centre
- Submit a bulk application for RWT benefits on behalf of all affected employees
- Provide a schedule of affected employees with their normal and reduced salaries
- Submit supporting documents: financial statements, auditor confirmation, or other evidence of operational necessity
- The UIF will assess the application and, if approved, pay the benefit directly to employee bank accounts or to the employer for distribution
Employers who claim RWT benefits for employees who are actually working full hours, or who keep the UIF payment instead of passing it on, are committing fraud. Penalties include criminal prosecution, full repayment, and deregistration.
Duration of the Benefit
RWT benefits are typically paid for the duration of the reduced hours, up to the employee available credit days. The standard credit day limit of 238 days applies across all UIF claim types.
Employers must update the UIF each month with the current working hours and salaries to maintain the benefit. If normal hours are restored, the employer must notify the UIF and stop claiming.
Difference Between RWT and Unemployment Benefits
Reduced Work Time benefits are for employees who are still employed but with reduced hours. Unemployment benefits are for employees who have been fully dismissed, retrenched, or whose contracts have expired.
An employee on RWT cannot simultaneously claim standard unemployment benefits. Once fully retrenched, any remaining credit days can be used for unemployment benefits.