How to deal with an employer who doesn’t pay pension fund contributions

Gugs Mhlungu spoke to resident certified financial planner, Paul Roelofse. 

Listen to their conversation in the audio clip below.

A concerning trend has reportedly emerged where many employers are failing to fulfil their obligations by not contributing to their employees' pension funds. 

Roelofse says this oversight poses significant risks for employees, undermining their financial security and future retirement plans.

In his latest blog post, Roelofse outlines the consequences of unpaid pension contributions for employees:

Financial Impact

Employers not contributing to pensions can harm employees' retirement savings, especially younger workers who may not grasp the long-term consequences.

Legal Complications

Insufficient contributions may lead to legal issues, affecting employee benefits and fund access.

Recommended Actions

Employees should check their pay stubs and pension statements for contributions, document any discrepancies, and seek clarification from their employer.

Seeking Support

If the issue continues, reach out to the pension fund administrator, labour union, or seek legal advice to understand and protect your rights for financial security.

"It certainly is a very serious situation to be in when your employer's not honouring their obligation to pay across your pension fund contributions."

- Paul Roelofse, certified financial planner

"It's something that now becomes a problem for individuals to take up just to ensure they are correctly allocated in terms of their pension fund contributions."

- Paul Roelofse, certified financial planner

"It's your right to have your pension paid across and if it isn't well then the recourse is on your side in terms of getting the employer to rectify the situation and or face any sort of charges that could come with that."

- Paul Roelofse, certified financial planner

If you as an employee find yourself in this position, Roloefse recommends that you first approach your company's Human Resources (HR) department to flag this issue.

He adds that it's best to do so in writing.

Based on the feedback from HR, you can then plan your next steps.

If you need to take the matter further, Roelofse advises you get in touch with the fund's adjudicator or the Financial Sector Conduct Authority (FSCA).

For more financial insights visit Roelofse's website www.investforlife.co.za 

Scroll up to listen to the full conversation.