JLW urges withdrawing amendment excluding some employees from old-age insurance

AMMAN — The Jordan Labour Watch (JLW) has been calling to revoke a Social Security Corporation (SSC) amendment that excludes some sectors’ employees from old-age insurance.

As of March 2022, the SSC amended a law that states employees under the age of 28 working in the agricultural and information technology sectors are excluded from the SSC’s old-age insurance, with the condition of having them under any other insurance plan available at the employing firm until 2024, according to a JLW paper.

“Old-age insurance is the most important SSC insurance for employees,” JLW Director General Ahmad Awad told The Jordan Times.

On Saturday, the JLW issued a position paper titled “Social Security Amendments: A Decline in Youth’s Social Protections”, stating that the implementation of the SSC law amendment “contradicts” the directions of the Jordanian state to ensure the participation of the younger generation in the labour market.

Awad highlighted that the unemployment rate among young Jordanians exceeds 50 per cent.

“Excluding employees under the age of 28 from old-age insurance will be an obstacle in their career paths,” economist Wajdi Makhamreh told The Jordan Times.

Makhamreh added that the SSC amendment will make it even more challenging for sectors to recruit qualified employees, as employees will not be motivated to work in the regulated workforce.

“We urge the government to offer incentives for the sectors instead of allowing them to exclude employees from old-age insurance,” Makhamreh added.

The JLW paper added that the SSC amendment “will contribute to increasing unregulated labour among employees under the age of 28”, since the amendment employees will lose at least five years’ subscription to one of the most important insurances provided by the Insurance Act.

In 2019, the government passed an amendment to Article 4 of the Social Security Act that allows the institution to exclude workers in some sectors under the age of 28 from old-age insurance coverage. 

However, employees excluded from old-age insurance have to be included in other insurance plans available at the hiring institution, according to the JLW paper. 

“This amendment tends to support employers in certain economic sectors at the expense of providing basic social protections for workers,” Awad added. 

“The SSC will also lose a lot of subscriptions due to this amendment,” Makhamreh said.