Labour inspectors’ to regain powers on pension fund payments

EMPLOYMENT and Labour Minister Nomakhosazana Meth said she will restore labour inspectors’ powers to enforce compliance by employers with laws that require them to pay pension fund contributions within seven days of deduction from employees' salaries.

- MAYIBONGWE MAGHINA

Meth was responding to parliamentary questions from EFF MP Omphile Maotwe.

Maotwe noted that the report by the Financial Sector Conduct Authority (FSCA) revealed that approximately 7770 employers, including a large number of municipalities and companies in the security and cleaning sectors, failed to pay over pension fund contributions deducted from employees’ salaries as of December 2023.

She noted that the nonpayment resulted in a pension debt of R5.2 billion, affecting over 31 000 workers and severely undermining the implementation of the two-pot retirement system.

Maotwe asked whether the Employment and Labour Department has undertaken any investigations into the implicated employers and the number of labour inspectors assigned to conduct compliance checks.

She also enquired about enforcement measures taken against non-compliant employers and measures in place to ensure that affected workers were compensated and/or had their retirement savings restored.

In her reply, Meth said she was aware of the serious issue raised in the FSCA’s 2023 report regarding failure by companies to pay pension fund contributions deducted from employees’ salaries.