The National Social Security Fund (NSSF) has upgraded its web-based whistleblower portal to enable members report defaulting employers in a seamless manner, and ultimately increase the compliance rate to 60 per cent in this financial year 2023/24.
The new features of the upgraded portal include a complete anonymity option to protect whistle-blowers from possible victimization. In addition, the new portal now allows government inspectors to report government contractors who stubbornly refuse to contribute to the Fund as per the new NSSF Act.
The new act requires all employers, irrespective of size, to remit social security contributions for their employees. Announcing the portal upgrade, Patrick Ayota, NSSF Managing Director, noted that only 20,762 out of 36,426 registered employers were actively remitting contributions to the Fund, giving a compliance rate of 57 per cent.
“This indicates that we have a compliance rate of only 57 per cent. Compliance means that an employer is remitting the contribution on time and in full. The data above means that over 15,000 employers are not complying and are cheating their employees of their retirement savings. The sad news is that, on average, only 107 cases are being reported monthly,” he said.
Ayota further explained that the Fund initiates an investigation upon receipt of reported cases from the whistleblower. The reported employer is then offered an opportunity to comply and settle the matter amicably, if the allegation is proven to be true. Where the employer stubbornly refuses to cooperate, other drastic measures come into force including prosecution and the application of the punitive penalties permitted within the law.
“Over the last two years, we have recovered Shs 8.9 billion through litigation. We currently have over 390 cases and expect to recover even more with this new whistleblower platform,” he said.
Common forms of irregularities in NSSF compliance include employers defaulting on monthly social security remittances despite deductions from their employees’ salaries, employers who don’t contribute their mandatory 10 per cent on top of their employee’s 5 per cent contributions, and employers who underdeclare their staff’s gross salaries with a motive to pay less monthly contributions for their staff.