Answer to a question from a reader

Can prisoners claim UIF and provident funds from prison?

The short answer

Prisoners may claim from the provident fund but not the UIF.

The whole question

Dear Athalie

My brother worked for his company for 17 years. He is now in prison. Is there a way that we can claim his UIF and provident fund?

The long answer

As far as UIF goes, a prisoner may not claim UIF while in prison, because UIF cannot be claimed if you have resigned, been suspended, or absconded from work. The employer will take your brother’s imprisonment as having absconded or resigned from his work.

With the provident fund, a prisoner can be paid a withdrawal benefit, which is what the provident fund pays if you leave work through resigning or being dismissed before you are due to retire. Being in prison means your brother cannot work so his employer will have dismissed him or taken it that he had resigned. 

This withdrawal benefit will not be as much as he would get if he retired, but he is still entitled to the withdrawal benefit after tax. But if he does not claim his benefit after 24 months, the provident fund will put it into an unclaimed benefit fund. 

The only way that the provident fund could refuse to pay is if your brother was imprisoned for fraud or dishonesty, and he had admitted in writing to an actual amount of money he had caused his employer to lose. The employer would still have to get a court order ordering the provident fund to withhold the amount of money that your brother admitted to losing and pay it over to the employer.

If your brother did not make such an admission in writing and the employer did not get a court order, the provident fund must pay him his withdrawal benefit. You should find out from his employer if there has been any court order against your brother’s provident fund payment, and you should also speak to the provident fund’s administrator.

You, as his sister, would not be entitled to his provident fund payout. The Pension Fund Act says that benefits are not reducible, transferable or executable. That means his provident fund can only be paid to him, except in the case of a court order, as I have explained above. 

A member’s dependents are only paid out, according to the rules of the fund, when the member dies.

Wishing you the best,

Answered on April 12, 2022, 12:46 p.m.

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