Noncompliant security companies who aren’t paying over their workers’ pension contributions to the administrators of the Private Security Sector Provident Fund are frequently changing their business addresses, names and identities to avoid being traced.
Some even go as far as registering with the pension fund and paying their workers’ contributions for two months just so they can get a compliance certificate for tender purposes. The certificate is only valid for a month.
This is according to the fund, which has more than 300,000 members who are mostly security guards. Most of these workers only discovered that their employers failed to pay contributions when they wanted to withdraw their benefits.
Numerous cases of participating employers who are marked as non-compliant have been escalated to both the office of the pension funds adjudicator and the police.
— Muvhango Lukhaimane, pension fund adjudicator
The fund came under fire last week when the pension fund adjudicator, Muvhango Lukhaimane, criticised it for not having a proper monitoring system in place to detect nonpayment of contributions by employers and for consistently failing to act against defaulting companies.
In response, the fund management told Sowetan in a statement that one of the contributing factors for failing to act against defaulters was the inability to trace defaulting security companies.
“In many instances, this is attributed to the nature of the private security industry, where some security service providers operate without fixed premises, frequently alter trading identities, or cease operations shortly after registration of their respective security company as a participating employer of [the fund],” it said.
“This presents significant obstacles in tracing employers and ensuring sustained compliance. Nonetheless, the fund remains steadfast in its mandate to safeguard members’ interests and uphold accountability across the sector.”
In addressing this issue, the fund managers said they have established rigorous compliance protocols, including the establishment of a dedicated task team focused solely on noncompliance.
“Numerous cases of participating employers who are marked as non-compliant have been escalated to both the office of the pension funds adjudicator and the police. Letters of demand are routinely issued to defaulting employers, and affected workers are formally notified when contributions are outstanding.”
The names of noncompliant firms are placed on the fund’s websites to alert workers.
The fund has engaged various corporates and state entities across the country, urging them to investigate the security companies they appoint and ensure that these employers are fully compliant with the fund.
“The fund strongly believes that resolving this issue requires collective effort,” it said. “Companies that require security services must take responsibility to ensure that every security company they contract is meeting its obligations and taking care of its employees by paying contributions to the fund.
Sowetan
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