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Summary
· Bank of Uganda alleges that the 77 employees took advantage of the promulgation of the Registration of Persons Act, No. 4 of 2015 to lower their ages while registering for the national identity cards against the records they filed with the bank at the start of their employment
Bank of Uganda is suing former and
current employees over a move by the employees to lower their ages in order to
lengthen their contracts and continue receiving pension and other benefits from
the Central Bank.
Documents seen by this publication
show that some BoU employees reduced their ages by more than four years. At the
time of filing the suit, 69 of the 77 employees accused were still active
employees of the bank while the rest are former employees.
Bank of Uganda alleges that the 77
employees took advantage of the promulgation of the Registration of Persons
Act, No. 4 of 2015 to lower their ages while registering for the national
identity cards against the records they filed with the bank at the start of
their employment.
The Registration of Persons Act No.
4 of 2015, promulgated on March 26, 2015, among others, provides for the
issuance of national identification cards and creates the National
Identification and Registration Authority (NIRA).
In the suit filed by BoU lawyers of
MMAKS Advocates, in the Civil Division of the High Court, the Central Bank
alleges that following the promulgation of the Act, a practice emerged in which
various public servants registered dates with NIRA that gave them ages a few
years younger, but seldom older than the ages previous registered by them with
their employers.
This was soon discovered to be a
ploy to postpone retirement dates or accrue more pension or NSSF contributions
by employees pushing forward the date at which they would attain the age of 55
years at which age the BoU’s obligation to pay the 10 percent employers
contribution to NSSF would cease.
On February 6, 2017, the Permanent
Secretary of the Ministry of Public Service pursuant to section L-b (7) of the
Uganda Public Service Standing Orders clarified that the date of birth of a
public officer shall be that which was initially declared and recorded on
commencement of employment.
Earlier, on November 11, 1999, the
BoU’s Board of Directors then also reviewed the change of dates of birth matter
and concluded in Board Resolution No 247 that the guiding age for all purposes
shall be the age declared by an employee on commencing employment.
In November 2021, the
government-owned New Vision reported that more than 1,000 civil servants in
central and local governments had applied to have their age changed. The vast
majority were inching closer to 60 years, which is the mandatory retirement
age.
Documents seen by Sunday Monitor
including copies of national IDs and appointment letters show that the accused
current and former employees while commencing employment with the BoU filled
out the formal declaration forms indicating their ages of birth which ages
turned out to be different from those declared to NIRA when the accused
employees were registering for national identity cards.
Enter NSSF
BoU like any employer is required to
pay NSSF a monthly contribution of 15 percent of the wages of its “eligible
employee. The monthly contribution is made up of a 10 percent
contribution by the employer and five percent contribution by the employee.
NSSF carried out an audit of BoU’s
compliance with NSSF contributions and concluded the accused employees are
entitled to rely on their NIRA declared age and have the BoU continue to make
NSSF contributions in relation to them, notwithstanding the discrepancy with
their earlier declared age when their employment commenced.
NSSF also contended that the NIRA
declared ages have retrospective effect in law and are binding on BoU.
Consequently, NSSF assessed the BoU to “substantial sums” on shortfalls in NSSF
contribution based on the NIRA-created age discrepancy. NSSF also added to the
assessments interest and penalties which BoU opposes.
“The plaintiff, accordingly, seeks a
declaration that the first defendant’s assessments on it based on the alleged
NIRA age shortfalls are unlawful and void at law,” BoU lawyers write. BoU has
also asked court to award the Central Bank costs for the suit.
Retirement benefits are often
provided by pension systems based on a number of variables, including years of
service and age at retirement. Employees who lie about their age to earn a
greater pension benefit are breaking the law and risk facing serious
repercussions, such as the loss of their pension payments and possible criminal
prosecution.
A new automated system comprising
all public sector employees’ biodata, including their age and their initial
official date of employment, was introduced by the government in November 2021.
When an employee is eligible for retirement, the system is set up to
automatically move them from the active payroll to the pension system.
By focusing on the age stated at the
time of entry into the public service, the system was created to prevent
employees of the public sector from changing their age.
notu, bou react
In an interview, the chairperson of
General of the National Organisation of Trade Unions (Notu), Mr Usher Wilson
Owere, said he was not well versed with the matter. Ideally, he said, there
should not be any dispute because NSSF relies on the correct data provided by
the employer, in this case BoU.
“The issue I think is structural
which they must correct. What is killing BoU is they don’t have a worker’s body
that represents the issues of the workers. They should be having a union with a
collective bargaining agreement,” he said.
The Deputy Director of
Communications at BoU, Natamba Bazinzi, said: “This matter arose out of
discrepancies in the dates of birth indicated by some staff members at the time
of getting employment with the bank, which dates of birth are different from
those they later indicated to other government authorities. The bank took a
decision to obtain a declaratory judgement from courts of law in order to
resolve the matter conclusively.”
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