What happens to an employee retirement benefits that is already under a pension scheme before the commencement of the Act?
Every employee right to accrued pensions is guaranteed under the Act. In the case of the public sector where the scheme was unfunded, the pension benefits will be acknowledged through a federal government retirement bond, which shall be redeemed upon the retirement of the employee. In anticipation of the redemption of the bond the FGN shall establish a retirement Benefit Bond Redemption Fund at the CBN into which it shall pay 5% of the total wage payable to the employees on a monthly basis. In the case of funded private schemes, the employer shall credit the RSA of its employees with any funds to which each employee is entitled and to the event of a deficiency, the shortfall shall become a debt and treated with the same priority as salaries owed. The employer shall also issue a written acknowledgement of the debt and take steps to meet the shortfall.
