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The law provides that –
There shall be established for any employment in the Federal Republic of Nigeria, a contributory pension scheme for payment of retirement benefits of employees. The law particularly states that the scheme shall apply to all employees in the Public Service of the Federation, FCT and the Private Sector. In the case of the Public Sector, who are in employment; and in the case of the private sector, who are in employment in an organisation in which there are 15 (fifteen) or more employees.
The way it works is every worker who is due has a PFA (Pension Fund Administrator) who keeps a pension fund account on behalf of the employee. A certain percentage of the employee’s salary is deducted and paid into the account while the employer also contributes a certain percentage to the account monthly.
Payment or contributing to the pension of an employee is important as the objective is to assist individuals by ensuring that they save in order to cater for their livelihood during old age. If however, pension is so important to every Nigerian worker, how come a lot of employers, most especially in the private sector, get away without paying same.What is the National Pension Commission, a body established to regulate, supervise and ensure the effective administration of pension matters in Nigeria doing about it.
Most especially as the Pension reform Act provides that any person who contravenes provisions of the Act where no other penalty is prescribed commits an offence and is liable on conviction to a fine not more that
N250,000 or to
imprisonment for a term not exceeding one year or both.