Nigeria Plc have dragged the bank to court over failure of the bank to remit the sum of N76.7 billion it deducted from salaries but reneged in remitting same to the various pension administrators.
According to the Pension Reform Act 2014, the employer shall make a contribution of 10 percent minimum of monthly income, usually deducted at source while the employee shall add a minimum of 8 percent which is expected to be remitted to the appropriate pension administrator for each employer.
Rates can however be revised based on agreement while an employee can also make voluntary contribution to the scheme. Penalty for default is N250,000 or one year imprisonment or both.
The purpose of Pension Reform Act is to ensure that every person who worked in either the Public Service of the Federation, Federal Capital Territory or Private Sector receives his retirement benefits as and when due and to assist individuals by ensuring that they save to cater for their livelihood during old age.
But most companies, especially in the private sector would deduct and not remit not to talk of adding their mandatory contribution of 8 percent and in the process guilty of Pension Fraud. Union Bank falls within this category of employers based on the class action filled before the National Industrial Court of Nigeria(NICN) in Ikoyi, Lagos.
In this class action led by Sanyaolu Sulaimon and Mkpa Jacob, the claimant averred that since 2008 Union Bank Plc has reneged in its responsibility to transfer the actual money in their Legacy Pension Fund to their retirement savings accounts domiciled with the appropriate pension administrators.
They are seeking declaration that Union Bank breached provision of the Pension Act 2004 as amended 2014.
They are also seeking a motion to compel Union Bank Plc to pay accrued sum of N13.7 billion of the unpaid fund to their lawyer, Mr. Monday Ubani and another N2 billion as damages for delayed remittance and transfers, malicious intentions, illegal and unlawful withholding of pension funds.
