Understanding the Contribution rates and the process of Contracting-Out of Tier II Contributions under the NSSF Act, 2013

The National Social Security Fund Act (herein the “NSSF Act”), 2013 was assented into law on 24th December 2013 & commenced operation on 10th January 2014. Soon thereafter, several trade unions filed Petitions with the Employment and Labour Relations Court (ELRC) challenging the constitutionality of the NSSF Act. The issues raised in the petitions included alleged lack of public participation in the enactment process of the law and the perceived unfairness of mandatory contributions to the NSSF, particularly for employees already covered by longstanding and established retirement schemes established by their employers. The ELRC, in its judgment, declared the NSSF Act 2013 unconstitutional, null, and void. Subsequently, an Appeal of the ELRC’s decision was lodged with the Court of Appeal.


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