Companies Risk Prosecution for Non-Implementation of Compensation Scheme


Paul Obi in Abuja

Following the increasing number of companies yet to implement the Employees Compensation Scheme (ECS), the federal government is to commence prosecution of companies yet to enroll their workers in the scheme.

This was part of the resolution at a parley between officials of Ministry of Labour and Employment and the Nigerian Social Insurance Trust Fund (NSITF).

The Minister of Labour and Employment, Sen. Chris Ngige, who visited the NSITF Lagos Regional Office, observed that the registration of only 9,400 employers by the Lagos regional office is abysmally low, arguing that, the office has the capacity to achieve its target of 100,000 before the end of 2016.

Ngige expressed concern about the level of non-compliance in Lagos regional area, stressing that employers must get compliance notice in the next couple of weeks before they are dragged to court for prosecution.

The minister stated that the government would soon raise a surveillance team that would be entrusted with the responsibility of monitoring the performances of the Lagos regional office.

He said: “I understand that some allowances have not been paid to the staff. I want those allowances to be paid in two installments. The first should be paid before the end of June while the second should be paid in September so that people can pay their children school fees.”

The acting Managing Director of the Fund, Ismail Agaka said: “Whoever is defaulting is liable and would be prosecuted in the law courts. The law is very clear about the punishment for defaulting.

“It is our responsibility to prosecute those who are not willing to comply without any genuine cause. There are other ways of dealing with those who are unable to comply genuinely. We will go after those who feel that they can go about their businesses without complying.

“But before we prosecute, defaulters would be given another opportunity by reminding them of their obligations and penalties that are prescribed for non-compliance and that they would be prosecuted if they do not comply after the expiration of the extended period.”

Agaka maintained that the ministerial directive to increase the number of employers to 50,000 by the government would be pursued within an enabling framework and the prevailing economic realities in the country.

“The mandate to increase the number of employers on the scheme to 50,000 before the end of the year will be taken in tandem with the reigning economic realities prevailing in our country today.

“We have given marching orders to our staff to go after companies and employers who ought to have registered but have failed to do so. In carrying out the prosecution of the defaulting companies, we have to do that within the economic outlook of the country,” he said.

He explained that in order to increase the number of employers and companies on the scheme, NSITF would be collaborating with the Nigeria Employers Consultative Association (NECA), NACCIMA, Lagos Chamber of Commerce and other organised private sector in order to put in place a workable plan towards reaching employers.

Agaka further stated that “as umbrella bodies these organisations know how to tap into their constituencies. I will be paying a visit to these organisations very soon to sketch out a working alliance with them on how to widen participation by employers of labour in the Employees Compensation Scheme (ECS).”

The NSITF acting MD identified low awareness of the scheme among critical stakeholders as the greatest challenge facing the implementation of ECS.

He said: “One of our major problems is that awareness is low amongst Nigerians on the existence of the scheme. That is why we are engaging relevant trade associations and guilds to also help enlighten their members on existence of the scheme as well as the obligations of all employers. We also have recalcitrant employers that feel they the scheme is not for them.”