Jordan: Unemployment benefits
Updated by Florence Bonnet on 12.06.2015
Institutional and legal framework
Current law: 2010 (Temporary Social Security Law No. 7), unemployment insurance to be implemented in 2011.
Unemployment benefit included in the social security insurance was designed by the SSC in consultation with the World Bank. It is currently being phased-in as a defined contribution scheme. The scheme works as a savings account which means that it lacks the redistribution element. This type of programme may provide some protection in case of unemployment to those workers who have built up sufficient savings in their individual accounts. In case the insured person has drawn more unemployment benefits than he or she contributed in the lifetime, upon retirement the pension will be adjusted downwards. In view of the ILO these two features are against international standards.
The financial resources for Unemployment insurance will consist of the following (Article 48):
- Monthly contributions apportioned by the employer of 0.5% of the insureds' wages.
- Monthly contributions deducted by the employer of 1% of insureds' wages.
- Interests, fines and additional sums entailed in the case of non-compliance with the provisions of this law.
- Any contribution paid by the state treasury to finance this insurance.
- The proceeds of investment of the above mentioned resources.
Coverage and qualifying conditions
All workers subject to the rules of the Labour Law regardless of their sex or nationalities ranging between (16-60) years old for males and (16-55) for females, as well as public employees not subject to civil or military retirement law, and Jordanians employed at foreign political, military or international missions in Jordan.
The insured is entitled to an unemployment allowance provided that: The numbers of contributions are no less than 36 contributions in accordance with this law before the date of his/her entitlement to an unemployment allowance.
Exclusions: Self-employed persons, voluntary contributors, and certain categories of government and public-sector employees as determined by the Board of Directors of the Social Security Corporation.
Unemployment allowance: level and duration
The unemployed insured shall be subject to the allocation of this allowance during three months if the number of contributions was less than 180 and six months if the number of contributions number was 180 or more. The level of unemployment allowance shall be calculated on the basis of the following proportions from last wage (subject to deduction): 75% for the first month, 65% for the second month, 55% for the third month and 45% for the fourth, fifth and sixth month. The upper limit of the net unemployment allowance is JD500 monthly.
The insured has the right to receive unemployment allowance three times throughout his/her inclusion in the provisions of this law.
The unemployment allowance may not be combined with maternity allowance. The higher allowance shall be allocated.
It is too early to have information about effective implementation of the programme.
Social partners role
Social partners are participating in the administration of the scheme as members of the Board of Directors.
- Regulatory Framework
- Source of funds
- Qualifying conditions
- Cash benefits for insured workers
- Administrative organization
First law: 1978.Current law: 2010 (Temporary Social Security Law No. 7), to be implemented in 2011.
Type of program: Social insurance system.
Employees older than age 16 working in private establishments with at least 5 workers.
Exclusions: Self-employed persons, voluntary contributors, and certain categories of government and public-sector employees as decided by the Board of Directors of the Social Security Corporation.
Insured person: 0.5% of monthly earnings.
Self-employed person: Not applicable.
Employer: 1% of monthly payroll.
Government: Any deficit.
Unemployment cash benefits: Must have at least 36 months of coverage by old-age insurance before the date of entitlement to unemployment benefits.
Unemployment cash benefits: Paid for up to 3 months with contributions of less than 180 months; up to 6 months with contributions of 180 months or more. 75% of the covered wage is paid for the first month; 65% for the second month; 55% for the third month; and 45% for the fourth to sixth months.
Social Security Corporation (http://www.ssc.gov.jo) administers the program.
Social Security Corporation
PO Box 926031,
Tel.: +(962-6) 550 1880
Fax: +(962-6) 550 1901