AMMAN - Salaries of public and private sector employees dropped this month, as the Social Security Corporation (SSC) started collecting unemployment insurance from its subscribers.
Under the new measure, 1 per cent is deducted from the salaries of civil servants and private sector employees, while business owners pay 0.5 per cent, SSC Spokesperson Mousa Al Subaihi told the Jordan Times on Monday.
The SSC also began collecting maternity insurance this month from businesses owners, totalling 0.075 per cent per employee, both males and females, he said, explaining that this is part of corporate social responsibility.
The purpose of these deductions is to provide SSC subscribers with good social coverage, with monthly revenues from implementing theses charges estimated at JD5.5 million, Subaihi said.
Unemployment insurance will benefit workers who lose their jobs for a maximum of six months, and will be entitled to receive a percentage of their former salary from the SSC during that period, on the condition that they provide evidence that they are searching for work, he explained.
"The unemployment insurance will provide support for the unemployed and is a form of social solidarity," University of Jordan Professor Tareq Awad said, commenting on the new measures.
"It certainly has a cost, but it expands SSC services and will assist the jobless, especially since the unemployment rate currently stands at 13 per cent, the economy specialist added.
Economist Yusuf Mansour agreed that "the idea is good, but the timing is bad".
"This is a time of recession and it is not wise to impose additional taxes on people," he said, noting that it is a form of taxation.
"Moreover, five years from now, the SSC should not forget the purpose behind collecting these funds, Mansour added.
A young civil servant was dismayed at the decision.
"My salary is barely enough without any more deductions," he said, although the amount is 1 per cent and means a deferred payment.
Before the new measure was enforced, the SSC deducted 5.5 per cent of workers' salaries for pensions, while business owners paid 11 per cent for each employee.
An accountant of a major local firm, who preferred to remain unnamed, said the new deductions will affect a company's profit, noting that businesses will start taking these costs into account before setting their pay scales.
© Jordan Times 2011
