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Employees Compensation: NSITF, NECA to Work Out Conditions

10 Apr 2011

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President Goodluck Jonathan

Nigeria Social Insurance Trust Fund (NSITF) and Nigeria Employers Consultative Association (NECA) have agreed to work out appropriate modalities that will ensure a successful take-off and implementation and administration of the Employees’ Compensation Act (ECA) scheme.

The Act, which replaced the former Workman Compensation Act, was signed into law in December 2010 by President Goodluck Jonathan after being passed by the National Assembly. It makes provisions for adequate and timely compensation of employees in both public and private sectors of the economic who suffer any form of accidents in their workplaces.

Speaking at an interactive session in Lagos, Director General of NECA, Mr. Segun Osinowo, said a committee drawn from NECA, NSITF and labour would be formed to work out modalities for the implementation of the scheme.

Osinowo, who chaired the session, emphasised the need for NSITF to defer the commencement of contributions to the scheme by employers to July so that employers could be fully sensitised and acquainted with the provisions of the new Act in order to avoid rancour and defective implementation.

“In reference to the appeal by employers, NSITF should consider an implementation date and communicate this to employers in the next two days. Any future review of the rate payable should be subjected to wide consultation of employers,” he said.

Acting Managing director of NSITF, Umar Munir Abubakar, said the organisation is set to draw from past experience in managing the funds to the benefit of both employers and employees. He said the interaction was necessary to enable NSITF feel the pulse of critical stakeholders in the administration of the funds.

He solicited the support of stakeholders to ensure that the scheme delivers on its outlined objective of the Act.

 He disclosed that NSITF before the change of its mandate upon the coming into effect of contributory pension Act 2004, had successfully transferred pension assets in excess of N60 billion to Trustfund Pension, one of the licensed pension fund administrators (PFA) in the country.

“Just as it had happened in the past, so will it also be under the new scheme. Funds contributed by employers for running of the scheme will be properly managed. Your constituency is well represented on our Board providing assurance that the scheme delivers as outlined in the objectives of the Act,” he said.

Some key areas where the both parties have agreed to consider for the successful implementation of the scheme include setting up of a standing committee that will regularly look into issues as they arise, commencement date, possible retention of relevant areas in repealed workman compensation act, restriction of administrative cost of running the scheme to International Labour Organisation (ILO) benchmark, provision of safety and infrastructural aids in workplaces by NSITF among others.

NSIFT is assigned the statutory responsibility of managing the scheme to which employers of labour are under obligation to make monthly contributions on behalf of their employees. Under the scheme, which is more like a pool, NSITF is expected to promptly effect payment to a claimant employee involved in workplace accidents, including those resulting in permanent disability.

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