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If you are in formal employment your employer should be deducting your national pension scheme contribution from your salary and paying it, together with the employer’s own matching contribution, to the National Social Security Authority. The NSSA National Pension Scheme (NPS) contribution deduction should be reflected on your payslip. The employee’s contribution is now 3,5 percent of basic pay, up to the new maximum insurable earnings limit of $700 per month. The employer pays the same amount.
Prior to last month, the deduction was three percent of the employee’s salary up to a maximum insurable earnings limit of $200. The contribution rate was increased last month to 3,5 percent and the insurable earnings limit was raised from $200 to $700.
What that means is that those earning $700 per month and below should be having, as from June 2013, an amount of 3,5 percent of their basic earnings deducted as their national pension scheme contribution. Those earning above $700 should be having 3,5 percent of $700, which is $24,50, deducted from their salary.
Prior to June, the deduction should have been three percent of the basic wage of those earning $200 or below and three percent of $200, which is six dollars, for those earning above $200.
A number of people seem to be unsure whether or not they are contributing to the national pension fund. The contribution should be reflected as a deduction on one’s payslip.
“I have worked for two years. My payslip does not reflect anything to show whether I am contributing to NSSA or not,” one person wrote.
The chances are that, if no NSSA NPS deduction is shown on your payslip, you are not contributing to the pension scheme.
The best thing to do, therefore, is to approach the employer and point out that there is no NSSA pension scheme deduction on your payslip.
If he says nothing is being paid, then you could ask why this is, since you understand it is compulsory to contribute to the scheme and you would wish to do so.
Alternatively you could go to a NSSA office with your national identity card and ask for confirmation of whether or not you are registered with NSSA and whether or not your employer is paying contributions to NSSA.Whether or not you receive a pension or a lump sum grant on retirement and what the size of the benefit will be depends on how long you have contributed to the scheme for and one’s insurable earnings on retirement.
Insurable earnings are the earnings on which your pension contribution is based.
It is important, therefore, to be sure that you are contributing, or your employer is contributing on your behalf, to the pension scheme
Someone else said he receives no payslip. This obviously makes it difficult to know whether a pension fund contribution is being deducted or not.
The best advice here is to ask your employer to provide you with a payslip, so that you can see what your deductions are.
Everybody is entitled to know what his/her earnings are and what deductions are being made for tax, pension fund contributions and any other purpose. The normal way in which this is made known is through a payslip.
Someone else asked what happens if one refuses to contribute to the NSSA pension fund. Contributing to the fund is compulsory. Every employer in the formal sector is obliged to make the appropriate national pension fund deduction from every employee’s salary, in the same way that he is obliged to deduct income tax (Pay As You Earn) from every employee’s salary.
An employer who does not do that and does not remit any contribution to NSSA is committing an offence and can incur penalties as well as be prosecuted. “I worked for an NGO for 10 years paying to NSSA every month but when I checked with NSSA there is nothing and the NGO is refusing to fill in the NSSA form. What should I do?” asked one of the listeners to the radio programme Pamhepo neNSSA.
What you need to do is go to NSSA with your payslips, showing the deductions that were made. You may not have all of them but take as many as you can find and give NSSA the employer’s details and the dates for which you worked for the NGO.
If you can provide proof that you were having the deductions made from your salary, then NSSA will credit you with those payments and take action against the NGO to recover the money that it should have been remitting to NSSA.
Deducting money from an employee’s salary for payment to a third party and not passing it on to the third party is a serious offence. It amounts to theft.
Talking Social Security is published weekly by the National Social Security Authority as a public service. There is also a weekly radio programme, PaMhepo neNssa/Emoyeni le NSSA, discussing social security issues at 6.50 pm every Thursday on Radio Zimbabwe and every Friday on National FM. There is another social security programme on Star FM on Wednesdays between 5.50 pm and 6 pm.
Readers can e mail issues they would like dealt with in this column to [email protected] or text them to 0772 307913. Those with individual queries should contact their local NSSA office or telephone NSSA on (04) 706517-8 or 706523-5.
Online Reporter