The Caswell Franklyn Column – National Insurance Staff not Sufficiently Trained to Administer Scheme
Following my last column about the National Insurance Scheme (NIS), several people, who were having problems with that government department, sought my assistance. Today, I would like to share the experience of two persons since the troubles, they were forced to endure to get unemployment benefits, show up fundamental problems with the processes at NIS.
They were informed verbally that they did not qualify for the benefit because the NIS records show that they were not insured under the scheme for a year. Both of them had been working for the same employer from 2013 to July 2017, approximately four years. NIS contributions were deducted from their wages but were not being paid in. As a matter of fact, the employer registered the business some time in 2016 and only started to pay in the contributions to NIS at that time. All along the workers claim that they were not aware that their contributions were not being remitted to NIS.
Every employee, who earns a minimum of $21 per week or $91 per month, is required to pay NIS contributions. Private sector regular employees are supposed to pay 10.1% of their insurable earnings, and the employer is required to pay an additional 11.25% on the worker’s behalf. Section 15 of the National Insurance and Social Security Act mandates the employer to make the deduction and pay the money over to the NIS Fund. The employee has no control over that process and in most cases might not even be aware that the employer has not complied with the law.
My greatest concern is that these workers were told that they were not entitled to receive unemployment benefits since they were not insured for 52 weeks. That information might prove to be correct but it was improper to make that determination and orally communicate the decision to the claimant. Whenever a person makes a claim and it is disallowed, the Director of NIS is required, by Regulation 8 of the National Insurance and Social Security (Determination of Claims and Questions) Regulations 1967, to inform the claimant, in writing, of the decision and also inform him of the right to appeal. From my experience, appeal forms are not readily available and it seems as though officers take offence when their decisions are challenged.
However, if the appropriate procedure were implemented: the claimants would have been able to produce their payslips to show that they were employed for the required period; and that NIS contributions were deducted from their wages, even though that is not absolutely necessary to qualify for the benefit. If the employer failed to pay in the contributions, the claimant only needs to show that he was employed and that he did not make any arrangements with the employer to avoid paying the contributions in order to qualify and receive the benefits.
It is then up the the Director to go after the delinquent employer to recover the contributions. When I worked there in the 1980s that is how we operated, and we did so in compliance with Paragraph 6.(1) of the National Insurance and Social Security (Contributions) Regulations, 1967. It states:
Where a contribution payable by an employer in respect or on behalf of an employed person is paid after the due date or is not paid, and the delay or failure in making payment thereof is shown to the satisfaction of the Board not to have been with the consent or connivance of, or attributable to any negligence on the part of the employed person, the contribution shall, for the purpose of any right to benefit, be treated as paid on the due date.
Arising from this case, I am told by the remaining employees that the employer is making deductions from their wages to recover NIS contributions that were supposedly not deducted when due. Workers should be aware that it is contrary to Regulation 18.(2A) of the Collection of Contributions Regulations to do so. It states:
Any employer who fails to deduct an amount that is required to be deducted from a payment of remuneration to an employee, may not deduct that amount from any subsequent payments of remuneration made to the employee for the pay period for which he had failed to deduct.
Too many workers are being disadvantaged by officers of the NIS department who are unfamiliar with the regulations. Maybe, it would be better if NIS administration require its staff to qualify in its regulations rather that in academic degrees that have no relevance to its operations.