Tripartite Project Committee Meeting, July 2012

The TPC discussed the broad scenarios for unemployment schemes proposed by the ILO. On 20 July 2012, the TPC reached a consensus on a proposed mandatory social unemployment benefits system which will embrace the following agreed objectives:

• Provide adequate protection for those who lose their job and contribute to poverty eradication;
• Give flexibility to enterprises in adjusting to economic changes and in reorganizing their business (e.g. in the case of the introduction of new technologies) - UI would therefore contribute to the protection of businesses and not only of employees;
• Facilitate mobility of labour force through income security and re-employment measures;
• Be associated with job retention measures;
• Support job search and placement, training and retraining.

The TPC also attained consensus on elements of the possible unemployment benefits such as:

• coverage - all private sector salaried employees and apprentices under a contract of service of any type or duration;
• qualifying conditions – 12 months of contributions in the last 24 months and termination must be involuntary;
• a benefit rate of 40 to 50% and a duration of 3 to 6 months;
• entitlement conditions – job seekers must register at the employment office upon termination and report monthly on their job search activities.

Also, there would be a phasing out retrenchment benefits while introducing unemployment benefits: workers would remain entitled to the retrenchment benefits accrued up to the effective date of implementation of UI system but no further retrenchment benefits would accrue for work commencing after the effective date of UI system. The first three scenarios, in agreement with the TPC, build cumulatively on the following three pillars:

	Scenario 1	Scenario 2	Scenario 3
Pillar 1: Compensation              for loss of income	Unemployment Insurance (UI)	Unemployment Insurance (UI)	Unemployment Insurance (UI)
Pillar 2: Employability &              Business Protection		+ ALMPs	+ ALMPs
Pillar 3:Acknowledgment of tenure			+ Savings Accounts (SA)