DIRECTORS BEWARE: YOU CAN’T AFFORD NOT TO PAY PENSION FUND CONTRIBUTIONS

Thursday, February 27, 2014
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Directors of companies that fail to pay their employees’ pension fund contributions to the fund can now face a fine of up to R10 million and/or 10 years imprisonment. This is according to new amendments to South Africa’s pension law effective 28 February 2014. These amendments have dramatically expanded the consequences of late or non-payment of pension contributions for participating employers and their management. Until 28 February this year, only the employer company could be held liable for late or non-compliance. The consequences for the corporate entity were limited to late payment interest (which remains in place) and administrative penalties of up to R1000 per day of non-compliance at the discretion of the registrar of pension funds.

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