Civil servants go to court over pension scheme

Some junior civil servants have, through the Attorney General, taken the government to court challenging the implementation of the contributory pension scheme, saying is discriminates against them.

In an application filed in the Blantyre Registry of the Industrial Relations Court (IRC), Samuel Chaoloka, representing himself and all other civil servants on contributory pension scheme, says they want the court to grant an order stopping government from deducting their salaries for the contributory pension scheme until hearing and determination of the matter.

They argue that the implementation of the contributory pension scheme is unfair to them under Section 20 (1) of the country’s Constitution.

They further contend that the implementation of the mandatory pension scheme was discriminatory as it only targeted civil servants below 35 years old when all civil servants will retire at the same mandatory retirement age of 60 years.

Reads the application in part: “The minister responsible has handled the issue of contributory pension scheme in a discriminatory manner contrary to the provisions of Section 20 (1) of the Constitution.

“There was no communication on the justification for such a discrimination in the implementation of the mandatory pension scheme among the civil servants.

“A declaration that the implementation of the contributory pension scheme is discriminatory in relation to junior civil servants and, as such, it is unfair practice under Section 20 (1) of the Constitution and Section 31 (1) of Constitution of the Republic of Malawi.”

The matter was set for hearing on Thursday before IRC chairperson Austin Msowoya, but did not proceed as he was reported to be unwell.

The junior civil servants are being represented by Gondwe and Attorneys. And the lawsuit is through the AG Thabo Chakaka Nyirenda.

On July 1 2017, government rolled out the contributory pension scheme, about six years after an enabling law dictated it.

Under the arrangement, newly-recruited employees and those aged 35 years and below were supposed to be migrated to the scheme that Old Mutual would be managing.

A circular issued in 2017 addressed to all Principal Secretaries and heads of departments signed by then Secretary for Human Resource Management and Development Blessings Chilabade indicated that the government would be contributing 10 percent towards its employees’ pension.

“As you are aware, the Pensions Act of 2011 made it mandatory that all employers should provide pension to their employees regardless of their term of employment, whether on permanent or contract,” reads the circular in part.

Chilabade is on record as having said government, as an employer was given a grace period by the Pensions Act to migrate from its current pension scheme to the contributory one.

The move, he said, would allow it to properly manage the transition, considering the huge amount of liabilities required for all eligible employees in the civil service.