Pretoria – 8 June 2023 

Provident Fund Reprimanded For Not Ensuring Employee’s Contributions Were Paid

A provident fund has been taken to task by the Pension Funds Adjudicator for failing in its duty to enforce a determination to ensure that the employer pays contributions timeously. 

 

Muvhango Lukhaimane took issue with the Private Security Sector Provident Fund for not assisting the complainant to enforce the determination nor following up with a non-compliant employer to ensure that it pays contributions for its employees. 

 

The complainant commenced employment with Sakhile Ezweni Group (Pty) Ltd from 1 August 2017 until 31 August 2022. The complainant said the employer had failed to remit all provident fund contributions due on her behalf to the fund, despite deducting contributions from her salary monthly. The complainant had a fund credit of R308.05 as at 21 November 2022. 

 

The complainant previously lodged a complaint and the Adjudicator handed down a determination on 20 November 2019 when the fund was ordered to register the complainant as its member from 01 August 2017 and the employer was to pay outstanding contributions for August 2017 to November 2019. The above-mentioned determination was not enforced.  

 

In the latest determination, Ms Lukhaimane would only address the issue of the employer’s failure to pay provident fund contributions due on behalf of the complainant to the fund for the period of December 2019 to August 2022. 

 

The fund submitted that the employer owes an amount of R38 649.84 in respect of outstanding contributions for December 2017 to April 2019, and June 2019 to August 2022, together with late payment interest of R21 868.72 calculated up to 20 January 2023. 

 

Since this computation includes outstanding contributions from August 2017 to November 2019 for which a determination has already been issued, Ms Lukhaimane could not issue a determination sounding in money. The fund was ordered to re-calculate the outstanding contributions for December 2019 to August 2022. The employer was ordered to pay the outstanding contributions due on behalf of the complainant to the fund. The latter should pay the complainant a further withdrawal benefit upon receipt of outstanding contributions from the employer. 

 

In respect of the earlier determination, Ms Lukhaimane said the fund did not enforce that determination nor ensure that the employer complied. She said she had no record of receiving a complaint from the fund against the employer for non-compliance.  

 

“In terms of section 7D of the Act, the board is obliged to take all reasonable steps to protect the interests of members as reflected in the rules of the fund and the provisions of the Act.  

 

“It is not exactly clear how the fund goes about fulfilling this crucial role as in this instance it failed to do anything to assist the complainant to enforce the determination even though it is the duty of the fund to ensure that the employer pays contributions timeously.  

 

“The fact that the fund provided an amount of outstanding contributions inclusive of the period covered by the previous determination, goes to show that not only does the fund not follow-up on judgments granted, it also does not keep proper records.  

 

“This is an instance where a member is trying to protect her rights, meanwhile the fund is unable to perform one of its most basic tasks, let alone come to the aid of a proactive member.  

 

“Therefore, the fund must monitor and ensure that the employer complies with its duty to pay all provident fund contributions from here onwards as required in terms of section 13A(6) of the Act,” Ms Lukhaimane ordered. 

 

ABOUT THE PENSION FUNDS ADJUDICATOR 

The Office of the Pension Funds Adjudicator (OPFA) is a statutory body established to resolve disputes in a procedurally fair, economical and expeditious manner. The adjudicator’s office investigates and determines complaints of abuse of power, maladministration, disputes of fact or law and employer dereliction of duty in respect of pension funds. The OPFA is situated in Pretoria, Gauteng. 

For general enquiries or to lodge a complaint visit www.pfa.org.za, call 012 346 1738 or email Enquiries@pfa.org.za  

 

Issued by: 

 

Yogin Devan 

Meropa Communications 

(031) 201 0550 / 083 326 3962 

 

On behalf of: 

Pension Funds Adjudicator