?Says finance act ambiguity endangers workers? safety net

Employers in Nigeria have been told that the surest way to guarantee industrial harmony and sustained productivity is to secure the future of their workers through the Employees Compensation Scheme, ECS, rather than focusing only on the payment of salaries.

The Managing Director of the Nigeria Social Insurance Trust Fund, NSITF, Oluwaseun Faleye, gave the charge in Abuja when he received the leadership of the Oil Producers Trade Sector, OPTS, of the Lagos Chamber of Commerce during a courtesy visit to his office.

Faleye stressed that the welfare and long-term security of workers often outweigh demands for wage increases, urging employers to deliberately highlight policies that show genuine concern for their employees? future.

He said: ?You need to highlight your efforts at meeting their welfare demands through compensation schemes, health benefits and others, and tie this to outputs. Workers? demands are not always tied to salary and wage increases. The need to assure their future often takes priority.?

The NSITF Managing Director further called for compliance with the Employees Compensation Act, ECA, to be made a prerequisite for awarding contracts.

He insisted that employers must also ensure subcontractors, suppliers and other third parties in working relationships with them comply with the law by enrolling their workers in the ECS to avoid vicarious liabilities.

Earlier, the leader of the OPTS delegation, Steve Ojeh, commended Faleye?s leadership qualities and expressed optimism about areas of partnership between the two organisations.

He, however, raised concerns over the planned increase in contributions to the ECS beyond the current one percent rate, as well as the proposal to extend its scope beyond basic salary, housing and transport allowance.

Established under the Employees Compensation Act of 2010, the ECS provides compensation for workers who suffer work-related injuries, diseases, disabilities or death at no cost to the employee. Employers are required to contribute one percent of their workers? gross salaries to the scheme.

Reiterating NSITF?s commitment to workers? welfare, Faleye pledged sustained advocacy to deepen the culture of health, safety and environmental consciousness in Nigerian workplaces, saying it was the only way to guarantee the future security of employees.

Finance Act Ambiguity endangers workers? safety net

Meanwhile, the Chairman of the Management Board of the NSITF, Sola Olofin, has raised concern over what he described as the threat of regulatory overreach on the Fund?s independence, warning that the ambiguity in the Finance Act 2021 could jeopardize workers? social safety net.

Olofin made the remarks in his welcome address at the 69th Board Meeting of the Fund ? the third under the current Board held in Abuja.

He hinged his concern on the ongoing debate over the classification of contributions made to the Fund.

?The Finance Act 2021 has introduced changes with significant implications for NSITF. Of particular note is the conversation around whether contributions made to the Fund should be classified as revenue within the purview of the Federal Inland Revenue Service,? Olofin said.

He argued that the issue went far beyond accounting, stressing that ?this is not merely an accounting classification; it is a matter with far-reaching effects on the autonomy, operations, and the financial health of the Fund.?

The Board Chairman urged members to rally behind the Oluwaseun Faleye-led Management in strengthening NSITF?s policy stance on the Finance Act and the classification of contributions.

?As a Board, we have the duty to engage actively on this front ? to ensure that our position is clearly articulated and that the peculiar nature of NSITF?s contributions, which are statutory and earmarked for specific social security objectives, is fully appreciated by policymakers and tax authorities,? he said.

He further stressed the importance of sustained advocacy to protect the Fund?s independence: ?We must continue our advocacy, backed by sound legal and policy arguments, to safeguard the Fund from regulatory overreach that may impair its ability to meet its statutory obligations.?

Welcoming members to the meeting, Olofin described it as ?not only a statutory requirement but a demonstration of our collective commitment to stewarding this Fund in accordance with our fiduciary duties, the enabling Acts, and the trust reposed in us by the President of the Federal Republic of Nigeria, the Honourable Minister of Labour and Employment, and indeed, the Nigerian workers we serve.? (VANGUARD)

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