PenCom issues compliance certificate to 840 private sector employers

The National Pension Commission (PenCom), pension industry regulator, has issued compliance certificate to 840 private sector firms for complying with certain provisions of the Pension Reform Act 2014, as of the end of first quarter 2015.

According to the Commission, 1,050 applications for issuance of Compliance Certificates were received, out of which 840 employers were issued the Certificates while the remaining were rejected on the ground that they did not meet the requirements.

This certificate forms part of the requirements demanded by the government agencies and parastatals to be able to participate in government businesses and contracts.

The pension law made it mandatory for employers with at least three employees or more to contribute alongside their employees into a Retirement Savings Account domiciled with the Pension Fund Administrators as well as arrange a group life insurance with a life insurance firm for the employees.

The objective of this scheme is to ensure that every person working in either the public service of the federation, Federal Capital Territory, states and local governments or the private sector receives his retirement benefits as and when due, and to assist improvident individuals by ensuring that they save in order to cater for their livelihood during old age.

In the case of the private sector, the scheme shall apply to employees who are in the employment of an organisation in which there are three or more employees.

Section 4(5) of PRA 2014 mandates every employer to have group life insurance policy in favour of each employee.