Adjudicator: in certain cases, employers may withhold pension funds benefits

"The Pension Funds Act seeks to protect an employer's right to recover losses caused by the misconduct of an employee and has a legitimate objective of protecting employers' rights to recover debts," Dr Elmarie de la Rey, the acting Pension Funds Adjudicator said. "However, this is not an absolute right." One's employer can deduct from the employee's retirement fund if, for example, an amount due by a fund members to their employer; or in respect of any damage caused to the employer by reason of theft, dishonesty, fraud or misconduct by the member; following receipt of a written admission of liability by the employee or if the employer obtained a judgment in a court in respect of the compensation.

Another two complainants, on the other hand, had their complaints upheld and their retirement funds were instructed to calculate and pay out their benefits as soon as possible, according to Insurance Times & Investment News. Dr De la Rey said in her ruling that the tribunal accepts that the respondent "has a right to withhold a member's benefit pending the finalisation of legal proceedings that allege theft, fraud, dishonesty or misconduct. But in this complaint, there are no pending legal proceedings," she said. The respondent's decision to withhold the complainant's benefit was set aside and the respondent was ordered to pay the complainant's withdrawal benefit within 14 days of the determination.

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