Business, Company Law

EMPLOYEE’S BENEFIT UNDER THE NIGERIAN SOCIAL INSURANCE TRUST FUND ACT.

What body is responsible for Contribution in Nigeria?

The Nigeria Social Insurance Trust Fund is the body established by the Nigerian trust fund act 1993 which shall be paid all contributions and other monies as may be required to be paid or contributed under this Act and which Fund shall be operated and managed as provided in this Act

What is (are) the function of the commission?

The commission through its board performs the following functions

(a) the administration of the Fund and the investment of sums forming part of the Fund;

(b) the payment of the various benefits provided under this Act to persons entitled to the benefit; and

(c) the general administration of this Act and regulations made thereunder.

What Is The Scope Of Application Of The Act?

This law applies to every person

– Employed by an incorporated company or deemed incorporated

– Employed by a partnership (irrespective of the number

Who Can Be Registration?

Employees of these companies can be registered with the board in any manner as may be prescribed by the board.

Who Are Exempted From Registration

The following classes of individuals are exempted from registration

  1. Employees of public service of federation or a state or local government area who are entitled to the benefit of any scheme or pension on terms substantially similar to those prescribed by the pension act
  2. Person entitled to diplomatic and equivalent status under diplomatic, privileges, and immunities act
  3. Persons who are not citizens of Nigeria who are employed in Nigeria for a period not less than six years
  4. A minister of a religion who is engaged in the propagation of his faith

What Are The Categories Of Contribution Employers Can Make?

Employers are required by law to make the following contribution:

  1. Contribution for the first category: this contribution will be payable by or on behalf of the employee against the contingency of retirement, pension, death, invalidity, and emigration
  • Contribution for the second category: this contribution is payable on behalf of the employee by the employer against the contingency of employment injury

Frequency of payment

Contribution is to be paid monthly.

The various classes of contribution shall be paid every month at the rate prescribed by the regulation computed by reference to the wages of the employee

The contribution payable in respect of each month shall be on the last day of the month concerned

What Is The Penalty For Default?

If payment is not made within the time prescribed a sum of 5 % of the amount unpaid shall be added for each month or part of the month after the date when payment should have been made and any amount shall be recovered as a debt owing to the board by the employer

Will Salary Be Reduced?

No Employer can reduce remuneration on account of contribution     

The Categories Of Benefit

The categories of benefits as envisaged by the Act includes:

  1. Retirement pension benefit
  2. Retirement grant
  3. Survivors benefits
  4. Death grant
  5. Invalidity benefit
  6. Invalidity grant  

Reference

Section 1 Nigerian Social Insurance Trust Fund Act 1993

Section 4 Nigerian Social Insurance Trust Fund Act 1993

Section 10 Nigerian Social Insurance Trust Fund Act 1993

Section 11 Nigerian Social Insurance Trust Fund Act 1993

Section 12 Nigerian Social Insurance Trust Fund Act 1993

Section 13 Nigerian Social Insurance Trust Fund Act 1993

Section 15 Nigerian Social Insurance Trust Fund Act 1993

Section 16Nigerian Social Insurance Trust Fund Act 1993

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About Joshua Owie

Joshua Owie is a legal practitioner with 5 years post call experience in litigation, He currently is an associate of legal assent, a full service law firm with practise that spans across: Election petition, Human rights law, Commercial Law, Arbitration and dispute resolution, Labour law etc Joshua holds a masters' degree in Investment law from Nasarawa state university, A bachelor of Laws from the Nigerian law school and a LL.b from Igbinedion University okada, Edo state