National Pension Commission, PenCom, will bring the full weight of the law against defaulting employers any moment from now following the conclusion of jobs by recovery agents to recover unremitted, deducted funds by employers.

In a chat with journalists during a programme in Lagos about level of compliance and sanction against defaulters, PenCom’s Head of Compliance and Enforcement, Mr. Mohammed Bello, said the recovery agents appointed by the commission about four years ago to recover debts from employers, concluded their jobs by the end of March and any employer(s) still in default would face the full weight of the law.

According to him, “with respect to remittance, yes there are issues with respect to non-remittance of contribution by some employers. But I will not say that all employers are not remitting contributions.  But I can tell you that some private sector employers are not remitting as at when due.

As you are probably aware, we have the report on a monthly basis because we have a way that we get returns every month on remittances made by employers. Now what you have to understand is that there over 200,000 employers and we get information on that. Big time employers in the organized private sector are fully complying.

“Where we have problems are mostly small-scale and medium-scale employers. What we normally do when we observe that employers are not remitting contributions is that we engage them. Based on the data we receive, we monitor and see if like one, two or three months an employer has not remitted, then we write a letter formally to the employer and say look, we observe that you have not remitted these contributions for this period and it is against the law, it is a violation of the law.

We will quote the sections and also quote the penalty and then ask the employer to remit within a certain period, mostly we give four weeks. After four weeks if the employer fails to comply, we now send a warning letter. If you go to our website, you will see our sanctions regime spelling out what we normally do as the level of non-compliance escalates.

“From ordinary letter to caution, to warning then we go as far as litigation.

Recovery agents

”Now some of the employers that have not remitted, we have engaged consultants or recovery agents to recover the contributions. We engaged them for about 15 thousand employers that we observe have issues and they have worked for a period of about four years now and there have been improvement. Since we engaged these agents the level of compliance has improved.

So the recovery agents have made significant progress and some recoveries were made and in fact penalties were even paid. Some of the employers we have contracted for litigation, we have engaged some lawyers to prosecute them and they are at various levels. Usually, what we have noticed is that the moment you get to the level of notice of prosecution, the employers come and then quickly comply.”

On whether the commission is afraid to confront defaulting media organizations, Mr. Bello said: “It is not a question of being afraid. I can tell you that all the defaulting media organizations, we have contracted them to recovery agents and we have received various responses. A lot of times, you get responses from the employers.

First of all they challenge the reports and also you have to do some reconciliation because when agent establishes a liability, you have to give the employer the chance to respond. So, most of them will provide additional information and some of them will go and remit and say look we have remitted.

Some of them will be asking that the interest and the penalty should be waived. So, I know all the media houses; we have engaged them, we have contracted them to the recovery agents, like I said earlier. If recoveries have not been made, they are still in the process. So, it is matter of time. We expect that the recovery agents will conclude their job by the end of March this year. As I said, when we send our recovery agents they will establish a liability from 2005 till date. So whether it is two years, four or seven years, they will comply. So like I said, I expect that most of them will be dealt with by the end of March 2015.”

Speaking on what happens to interests and penalties on recovered funds, he added that “everything goes to the employee. For example what it means is that if your monthly contribution is N100,000 and the penalty is N50,000, N150,000 will be credited to the worker’s account. It is PenCom that will pay the recovery agent from its funds.”