To fortify retirement benefits for workers in Nigeria, the National Pension Commission (PenCom) has recently unveiled the Framework for the Establishment of Additional Benefits Schemes (ABS) under the Contributory Pension Scheme (CPS). This move aligns with Section 4(4)(a) of the Pension Reform Act (PRA), 2014, which allows employers to provide additional benefits to their employees upon retirement.
The PRA 2014 provides that notwithstanding the pension contributions made by the Employer and employee into the employee’s RSA, “an employer may agree on the payment of additional benefits to the employee upon retirement”. Accordingly, any employer may wish to provide additional benefits in the form of gratuity to its employees upon retirement. Employers, especially those in the public sector, can take advantage of the above provision in the law to enhance their employees’ retirement benefits.
