In the landscape of Nigeria’s retirement benefits, the true position of the Contributory Pension Scheme (CPS) on gratuity payments has been a subject of misunderstanding. However, a closer examination of the Pension Reform Act 2014 (PRA 2014) alongside initiatives by the National Pension Commission (PenCom) reveals a clearer picture that aims to fortify retirement benefits for workers across the nation.
Traditionally, gratuity has been a vital component of retirement benefits, symbolising acknowledgment for years of dedicated service to an organisation. With the introduction of the CPS as a reform to the old Defined Benefits Scheme (DBS), apprehensions arose regarding the fate of gratuity payments. Contrary to fears, the CPS framework, guided by the PRA 2014, has accommodated the payment of lump sums and other additional retirement and terminal benefits.
