PenCom automates penalties for employers delaying pension remittances

The National Pension Commission (PenCom) has launched an automated system to calculate penalties against employers who delay remitting workers’ pension contributions. This move aims to enhance compliance with the Pension Reform Act. Employers with outstanding penalties are prohibited from obtaining Pension Clearance Certificates until they settle their liabilities, which can impact their ability to secure government contracts and other business transactions requiring proof of pension compliance.

During the 2026 Annual PenCom Media Conference in Abuja, PenCom Director-General Omolola Oloworaran announced the new system, which automatically calculates penalties for late remittances. This system ensures that employers fulfill their obligations to workers under the Contributory Pension Scheme. Oloworaran noted that while penalties for delayed payments already existed under pension law, the new automated system ties the calculation and settlement of penalties directly to the issuance of clearance certificates.

Despite regulatory efforts, some employers continue to withhold contributions or delay payments. Oloworaran emphasized that PenCom is actively monitoring and targeting non-compliant employers. The commission has expanded pension compliance requirements to include commercial relationships between pension operators and their business partners, with major financial institutions like First Bank, UBA, GTBank, Access Bank, and Zenith Bank playing a role in supporting these enforcement measures.

Pension fund operators are also barred from investing in companies that fail to remit pension contributions for their employees. PenCom has engaged recovery agents to investigate employers’ records, determine outstanding pension liabilities, and recover unpaid contributions, resulting in cumulative recoveries of N36.6bn as of July 2026, surpassing the previous annual record. Oloworaran stressed that failing to deposit pension funds into an employee’s Retirement Savings Account constitutes a breach of trust and the law.

Regarding state government compliance, PenCom reported that two additional states began pension contributions in 2026 but have yet to meet all requirements for full implementation. The commission is working with state governments to enhance compliance and strengthen retirement benefits for their workers.