The National Social Security Fund (NSSF) has disclosed that 15,664 employers are not in compliance with their obligation to contribute funds for their employees, as mandated by the law. The revelation was made by Patrick Ayota, the NSSF Managing Director during a press conference following the launch of an upgraded web portal.
This enhanced portal now features additional protective functions to empower whistleblowers in reporting non-compliance. According to Ayota, the NSSF has a total of 36,426 registered employers, out of which only 20,764 are currently compliant—a situation that the Fund aims to rectify.
“Currently, only 20,762 out of 36,426 registered employers are actively remitting contributions to the Fund, resulting in a compliance rate of just 57%. This statistic implies that over 15,000 employers are not fulfilling their obligations, thereby depriving their employees of their retirement savings. Unfortunately, only 107 cases are reported monthly,” he noted.
Ayota further explained that the upgraded web-based whistleblower portal is a significant step to protect the rights of employees, ensure compliance, and ultimately achieve a 60% compliance rate in the 2023/24 financial year. The improved portal offers new features, including complete anonymity to safeguard whistleblowers from potential retaliation and an automatic tracking system for reported cases.
Worth noting is that this portal also allows government labor inspectors to report government contractors who persistently fail to contribute to the NSSF, in line with the new NSSF Act, which mandates all employers, regardless of size, to remit social security contributions to their employees. Ayota shed light on the investigative process, emphasizing that the Fund takes immediate action upon receiving reports from whistleblowers.
“Reported employers are given an opportunity to comply and resolve matters amicably if allegations are substantiated. However, when employers adamantly refuse to cooperate, the Fund resorts to more stringent measures, including legal action and the application of penalties permitted by law,” he stated. He also mentioned that over the past two years, the fund has successfully recovered UGX 8,969,549,733 through litigation.
Currently, it has over 390 cases, and with this new whistleblower platform, he anticipates increased recoveries. Instances of non-compliance with NSSF regulations take various forms, such as employers failing to remit monthly social security contributions despite deducting from employees’ salaries, neglecting to contribute the mandatory 10% on top of their employees’ 5% contributions, and under-declaring their staff’s gross salaries to reduce monthly contributions.
The upgraded whistleblower portal promises to be a game-changer in the fight for employees’ rights and the enhancement of compliance within the NSSF. It marks a pivotal step towards ensuring that hardworking individuals can secure their retirement futures, free from the burden of unscrupulous employers. With complete anonymity and a robust tracking system, the NSSF is forging a path toward a brighter financial future for all its members.
Ayota emphasized that direct interaction with the members has consistently yielded positive results in the past, and this web portal upgrade will help members take charge of their contributions and facilitate easier follow-up.