8 January 2013

Nigeria: Controversy Over Pension, Gratuity Now Put to Rest, Says Labour

ORGANISED Labour in the nation's Power Sector, has said the controversy over the continuity of gratuity after the enactment of the Pension Reform Act (PRA) of 2004 which gave birth to the Contributory Pension Scheme, CPS, has now been rested following the agreement reached with government on the payment of pension and gratuity to Power Holding Company of Nigeria, PHCN, workers.

Before the agreement ahead of the privatization of PHCN's assets, there had been a fierce debate between government/employers and organized labour on whether or not PRA 2004 abolished gratuity.

Under the umbrella of the National Union of Electricity Employees, NUEE, labour argued that following the agreement, employers who had mischievously contested that the PRA 2004, had abolished gratuity, even when the PRA did not say such, should now do the right thing by paying their workers pension and gratutiy.

Speaking to Vanguard on the fall out of the agreement with government, General Secretary of NUEE and Deputy President of Nigeria Labour Congress, NLC, Comrade Joe Ajaero, said the battle won in the power sector over gratuity was not for PHCN workers alone but, entire workers in Nigeria.

According to him, "We also took time to do some major researches on the items that constitute pension, and the items that constitute gratuity. The issue of gratuity was a call to duty for Nigerian workers. We were not doing it for PHCN workers alone but for Nigerian workers because we needed to set that precedence.

If they were being intimidated in other sectors to abandon gratuity which was becoming the norm, there was the need for us to prove that the Pension Reform Act, PRA 2004, at no time, merged gratuity with pension, being gratuitous. The government seemed to have captured many areas, so we decided to prove that PRA 2004 did not abolish pension."

"By this landmark achievement, every sector will know that the issue of being gratuitous, which is a one off payment, at the end of service, cannot be confused with pension, which is payment for life.

This is the major achievement which equally translates beyond PHCN. It is a victory for Nigerian workers and I pray that we workers, are going to sustain this achievement and nobody should henceforth succumb to intimidation in the course of asking for his or her rights."

It would be recalled that there had been a protracted controversy over the continuity of gratuity after the enactment of PRA 2004. While some employers had argued that the PRA and the contributory Pension Scheme, had abolished the payment of gratuity, labour had insisted that gratuity had nothing to do with pension and therefore, the PRA which is silent on gratuity could not have abolished.

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