Guest Contributor | Feb 21, 2024 | 0
Workers in limbo as GIPF NAC bicker
About thirty former workers of Namibia Airports Company face an uncertain future as their former employer argues with the Government Institutions Pension Fund (GIPF) over their retrenchment packages and specific insurance provisions.
In an effort to finalise the protracted dispute, the GIPF announced Thursday that it has decided to take the matter for arbitration, a process that could take months.
At the centre of the stand-off is whether the former NAC workers were retrenched or resigned of their own accord. The Airports Company is of the opinion that the former employees voluntarily decided to resign after being offered an opportunity to continue with their service. As a result the company argues the former employees do not qualify to receive early retirement benefit which has more enhanced benefits than a simple cash withdrawal benefit. Contradicting this stance, the GIPF a week ago put out a statement saying the NAC employees opted to switch pension funds, a process which was not finalised when the retrenchments happened. This was cited as the reason for the confusion and the delay.
However, the GIPF trustees say they do not agree with the basis advanced by the Namibia Airports Company for the fund to pay its former employees a simple cash withdrawal benefit. According to a media statement released Thursday by the GIPF, the Namibia Airports Company (NAC) is now backtracking on an agreement with the former workers reached early October on the type of benefits that the workers are entitled to.
Maria Dax, the Acting CEO of the GIPF said: “ GIPF on the other hand firmly believes that the former employees of NAC were dismissed as a result of reorganisation and therefore according to fund rules, they qualify to receive an early retirement benefit”
She added: “If employees were retrenched, they must be given bread for life and we stand by that as we believe we are right. If we are missing something then we need to be convinced and at the moment we are not.”
Dax appealed for patience from the former workers as the arbitration process might take long, although she is hopeful that the process may be finalised before the end of the year.
According to the GIPF Rules, an employee who is retrenched receives a withdrawal benefit which is paid as a lump sum. In addition, the employee is paid a monthly pension for life until the person dies.
The GIPF is responsible to pay a withdrawal benefit to the retrenched employee. The withdrawal benefit is made up of the employer and employees’ contributions received by GIPF plus the interest earned during the time when those contributions were invested.
The employer, in this case NAC, is responsible to pay pensions to the retrenched employees for life. This amount is to be paid to GIPF who in turn will pay monthly pensions to the employee as a pensioner of GIPF until death.
Retrenchment benefits, Dax added, are more beneficial [to the retrenched employee] than other benefits.