The National Pensions Regulatory Authority (NPRA) has announced a major crackdown on employers who deduct pension contributions from workers’ salaries but fail to remit the mandatory Tier 2 funds, warning that offenders will soon face prosecution.

Deputy Chief Executive Officer of the NPRA, Victor Azumah, said the Authority is intensifying enforcement measures to protect the retirement benefits of Ghanaian workers and restore confidence in the pension system.

“Employers who deduct pension contributions from their employees and fail to remit them are committing an offence and violating the rights of those employees,” he stated.

Stronger enforcement measures

Mr. Azumah disclosed that the NPRA has significantly strengthened its legal and enforcement framework to deal with persistent defaulters. According to him, more than 40 prosecutors have been trained nationwide to support the prosecution of non-compliant employers.

“We have trained over 40 prosecutors across the country to beef up our enforcement efforts and ensure that offenders are dealt with according to the law,” he revealed.

He explained that the move forms part of a broader strategy to ensure full compliance with Ghana’s three-tier pension scheme, particularly the occupational Tier 2 component, which is privately managed but regulated by the NPRA.

Employer obligations under the law

Under Ghana’s pension framework, employers are required not only to deduct contributions but also to ensure timely remittance to licensed pension fund managers. Failure to do so undermines workers’ future financial security and disrupts the integrity of the pension system.

Mr. Azumah emphasized that employers must also ensure that all employees are properly registered with approved trustees and pension schemes.

“We are urging all employers to register their workers and ensure that Tier 2 contributions are paid as required by law,” he added.

Penalties for default

The NPRA warned that sanctions will be strictly applied to employers who fail to comply. Beyond prosecution, defaulters risk financial penalties, including surcharges on outstanding payments.

“No employer should default in payment without proper communication. Any employer who does so will be surcharged a penalty of three percent of the amount in default,” Mr. Azumah cautioned.

He added that continued non-compliance could lead to further legal consequences, including court action and possible recovery proceedings to retrieve unpaid contributions.

Protecting workers’ retirement benefits

The NPRA says the enforcement drive is necessary to safeguard the long-term welfare of workers, many of whom rely on their pension contributions as a primary source of income after retirement.

Industry observers note that failure by some employers to remit Tier 2 contributions has been a longstanding concern, often leaving employees unaware that their funds have not been properly invested.

The Authority is therefore encouraging employees to regularly check their pension statements and report any discrepancies.

Call for compliance

Mr. Azumah reiterated that the NPRA prefers compliance over punishment but will not hesitate to apply the law where necessary.

“Our priority is to ensure that employers comply with the law, but we will not hesitate to prosecute where violations persist,” he stressed.

The NPRA’s latest warning signals a tougher regulatory stance aimed at ensuring transparency, accountability, and fairness in Ghana’s pension system.