adminmaximum insurable earnings level of US$700, when making deductions for the pension scheme from employees’ June salaries,” a spokesperson said.
“Employers are also required to contribute 3,5 percent of the employee’s insurable earnings themselves and remit to NSSA in the normal way by July 10 the combined total of 7 percent of each employee’s basic earnings up to the new maximum insurable earnings level of US$700 per month.”
Previously, the employer and employee each contributed 3 percent of the employee’s basic earnings up to a maximum insurable earnings limit of US$200. That meant the maximum pension contribution paid by an employee was US$6, which applied to all those earning US$200 and above.
Now the maximum employee’s contribution is US$24,50, which applies to those earning US$700 per month and above.
The employer pays the same contribution as the employee.
The new contribution rate and insurable earnings ceiling, which take effect from June 1, were gazetted last month along with new minimum pensions, which come into effect in August. The new minimum pensions are US$60 for retirement pension and US$30 for invalidity and survivor’s pension respectively.
Although the new minimum pensions only take effect in August, those retiring before then who are paying the new contribution rate will have their retirement benefit calculated on the basis of their insurable income when they retire as well as on their contribution period.
For those earning between US$200 and US$700 the insurable earnings will now be their basic earnings, rather than US$200 which was the previous maximum insurable earnings limit.
For those earning above US$700 the insurable earnings will be US$700.
Online Reporter