The Contributory Pension Scheme, CPS, seeks to, amongst others, ensure that every worker receives his retirement benefits as and when due.

Scope of the CPS

The scheme is contributory and mandatory.

Employer and employee contribute 10% and 8% respectively of employee’s annual emolument into the Retirement Savings Account (RSA) of the employee.

An employer may however elect to contribute the entire 18% on behalf of its employees.

In addition, voluntary contributions are allowed.

Conditions for accessing a retirement savings account

In order for an employee to gain access to his RSA, the RSA holder must be retired and must be above 50 years.

You can negotiate the mode of withdrawal of your benefits whether programmed withdrawal or annuity, depending on the one that will benefit you at old age. However, there is provision for initial lump sum withdrawal either with programmed withdrawal or annuity. However, an RSA holder can gain temporary access to his account before retirement only if he is out of job for six months or more. Accordingly, he may withdraw up to 25% of RSA balance once before the age of 50years.

Retirement based on terms and conditions

An employee may choose to retire before 50years in line with terms and conditions of employment. It could be retirement on medical ground based on advice of a physician/medical board, or it could be as a result of death or a missing person.

Claims procedure in the case of a missing persons

Where an employee is missing, the employer shall report this immediately to the employee’s Pension Fund Administrator, PFA, insurer and the National Pension Commission, PenCom.

The employer may advise PenCom to constitute a Board of Inquiry (BOI) on any missing person and the BOI decision to be communicated to PFA/employer. The Board of Inquiry shall stipulate the documentary evidence required from employers to process missing person claims and make available police report, employee’s passport photograph, newspaper publication of the missing employee, a letter from employer declaring him/her missing, and so on.

The employer should be represented on BOI and shall conclude investigation within 30 working days of receipt of complete evidence. Also missing persons presumed dead shall be treated as death cases.