Denel defaults on staff pension contributions

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  • South Africa

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Publish date 10 July 2019
Issue Number 4736
Diary Legalbrief Today
Staff at state-owned arms manufacturer Denel learned yesterday that the cash-strapped company has paid their salaries, but not their pension contributions. In a letter sent out by the ‘Denel retirement fund’, the fund said workers would not be able to ...

Staff at state-owned arms manufacturer Denel learned yesterday that the cash-strapped company has paid their salaries, but not their pension contributions. In a letter sent out by the ‘Denel retirement fund’, the fund said workers would not be able to claim benefits as monthly payments were not up to date, notes a TimesLIVE report. It read: ’Section 13A of the Pension Funds Act is unambiguous in that any employer must effect payment of members' contributions to the fund before the 7th day of the month following the month for which it is due.’ The letter sent to staff said: ‘The fund will NOT be able to process or effect payment of members' benefits, which include death in service and medical disability benefits, resignation benefits, investment return updates and any other benefits payable.’ It also said it would charge Denel interest on late payments. Solidarity's Johan Botha said the trade union had not yet confirmed exactly how many people were affected.