BY: Naa Afarley Quarcoo
The National Pensions Regulatory Authority in April 2020 sent words of caution to all employers who flout the laws and refuse to pay monthly contributions of employees towards a better retirement income security.
The CEO for the NPRA iterated that most employers who have refused to pay the Two-Tier pension for their employees have been prosecuted while those who are recalcitrant in doing so will be duly dealt with according to the law. At the media engagement on 30th March 2021, the Chief Executive Officer of the National Pensions Regulatory Authority Mr. Hayford Attah Krufi stressed that the main aim of the authority is to see to it that all pension contributors retire with good income security.
This he said can be achieved if all employers pay their employee contributions regularly.
He explained that the Pensions Act, Act 766 section 3 states that “An employer of an establishment shall deduct from the salary of every worker in the establishment immediately at the end of the month, a worker’s contribution of an amount equal to five and a half per centum of the worker’s salary for the period, irrespective of whether or not the salary is actually paid to the worker” and clause 3 of the same section also states that “Out of the total contribution of eighteen and a half per centum an employer shall within fourteen days from the end of each month transfer the following remittances to the mandatory schemes on behalf of each worker (a) thirteen and half per centum to the first tier mandatory basic national social security scheme; and (b) five per centum to the second tier mandatory occupational pension scheme.
The L.I 1990 now gives the authority the power to prosecute all employers who go contrary to the law and do not provide funds to pay for the contributions of employees.
He added that an employer who refuses to pay or better still pay late will be charged with criminal offenses and will be fined or imprisoned for two years or more.
Again on the 30th of June 2020, three months after the initial warning to employers, the Chief Executive officer of the NPRA explained that about 15 employers have proven to be recalcitrant in paying but the case will be processed to court soon.