Public Servants’ Pension (Amendment) Proclamation No. 907-2015
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You can also get the file from the official website of Public Servant Social Security Agency
Tag: pension
Private Organizations Employees Social Security Agency Establishment Council of Ministers Regulation Number 202/2011
Brief note
Following the promulgation of the Private Organization Employees Pension Proclamation No. 715/2011 which which was published and became effective on, 24th June, 2011, the council of Ministers issued a regulation establishing the Private Organizations’ Employees Social Security Agency on the 25th day of March 2011. The Agency is now in charge of the overall implementation of the Pension Proclamation No. 715/2011 particularly the administration private organizations’ employees pension funds.
There are two issues related to the issuance of this regulation worth considering. The first one is a minor error in legislative drafting. If you look at the English version of the heading of pdf version (which is scanned from the hard copy) of the document you will read a title “Private Organizations’ Employees Social Security Agency Establishment Proclamation.” As a proclamation refers to statutes issued by the House of People’s Representatives, it is surely confusing when the term is used for delegated legislation made by the Council of Ministers. However, when you compare the Amharic version of the same regulation (which is to be given effect in case of discrepancy) it becomes easy to realize that it is definitely a mistake to be blamed on the drafter. The Amharic version uses the term “ደንብ” which is use to represent the term “regulation. ” The official title of the text, as indicated in Article 1 is also indicated as “This Regulation may be cited as the “Private Organizations’ Employees Social Security Agency Establishment Council of Ministers Regulation No. 202/2011.” Hence the use of the term “proclamation” instead of “regulation” is an error in legislative drafting.
The second one is a fundamental constitutional issue likely to have serious implications on the basic principles of representatives democracy and accountability of government. As it is true in all democracies, the executive organ of government does not have a power of making primary legislation. However, irrespective of the principle of separation of powers, the complexities of public administration have necessitated the delegation of legislative powers to the executives organ. In Ethiopia, the council of Ministers and administrative agencies issue regulations and directives respectively based on a delegation conferred on them by the House of People’s Representatives. This being the case, delegation legislation as it offends the constitutional principle of separation of powers, is to be exercised narrowly. Constitutional fundamental public policy issues, therefore could never be delegated to executive organs.
When you see the above regulation, it essentially creates a government organ in charge of implementing a law made by parliament. In effect, a law made by parliament is left to the fate of a decision of the executive organ. Imagine a case whereby the council of ministers refuses to establish an agency, when a law by parliament endlessly waits for implementation. However, the basic issues involved goes beyond this.
The council of ministers by establishing an agency bestows a power upon itself. What powers to be give to an agency is solely a matter to be decided by the legislature. This is also at odds with the principle of accountability. How is it possible for parliament to hold a certain agency accountable when it is clear that parliament is not the source of power to that agency. Only the legislature has the power to create or ‘uncreate’ an administrative agency. But, when the agency is directly established by the executive only the executive will have a final say on the fate of the agency.
This is not the first time the Council of Ministers establishes an administrative agency. The power to create and ‘uncreate an administrative agency was given to the council of ministers by Article 34 of proclamation number 691/2010 (Definition of Powers and Duties of the Executive Organs of the Federal Democratic Republic of Ethiopia Proclamation No. 691/2010) which reads
“The Council of Ministers is hereby empowered, where it finds it necessary, to reorganize the federal government executive organs by issuing regulations for the closure, merger or division of an existing executive organ or for change of its accountability or mandates or for the establishment of a new one.”
The Private Organizations Employees Social Security Agency, just like other Council of Minister Agencies is established based on article 34 of this proclamation.
I will try to post more on this issue in the future. Here follows the text of the regulation.
Private Organizations Employees Social Security Agency Establishment Council of Ministers Regulation Number 202/2011
This Regulation is issued by the Council of Ministers pursuant to article 5 and 34 of the Definition and Duties es of the Executive , Organs of the Federal Democratic Republic of Ethiopia Proclamation No. 691/20120.
1. Short Title
This Regulation may be cited as the “Private Organizations’ Employees Social Security Agency Establishment Council of Ministers Regulation No. 202/2011
2. Establishment
1/ The Private Organizations Employees Social Security Agency ‘(hereinafter “the Agency”) is hereby established the as an autonomous federal agency having its own juridical personality
2/ The Agency shall be accountable to the Ministry of Labour and Social Affairs.
3. Head Office
The Agency shall have its own Head Office in Addis Ababa and may have branch offices elsewhere as necessary.
4. Objective
The objective of the Agency shall be to strengthen and expand private organizations’ employees social security programs.
5. Powers and Duties
The Agency shall have the powers and duties to:
1/ implement private Organizations’ empioyees social security laws, regulations and directives:
2/ establish efficient and effective system to implement the private organizations’ employees pension scheme;
3/ establish a system for the collection of private organizations’ employees pension contributions, collect contributions, ensure that pension contributions are collected by the appropriate organ in time and in the correct amount, supervise the implementation of the system by employers and, where necessary audit their documents and records by requiring their submission or through site visits;
4/ administer private organizations’ employees pension funds and assets related thereto;
5/collect in advance and maintain records of evidentiary data that entitle private organizations employees to pension benefits;
6/ take legal actions against employers and other individuals who fail to pay pension contributions, maintain accounts of contributions and furnish required documents and information on time;
7/ determine, the adequacy and validity of evidentiary data submitted in connection with claims of the employees of private organizations pension entitlements, as well as the types and amounts of benefits, and effect, payments of benefits;
8/ decide on claims related to pension rights and benefits of employees of private organizations;
9/ invest the private organizations’ employees pension fund in treasury bonds and ocher secured investments specified by directives issued by the Ministry or Finance and Economic Development;
10/ cause periodical actuarial study and review of the private organizations’ employees pension funds;
11/ undertake studies to strengthen pension programs of employees of private organizations, submit the studies to the government and implement same upon approval;
12/ issue directives on matters that come within its powers and duties;
13/ own property, enter in to contracts, sue and be sued in its own name;
14/ carry out such other activities as may be necessary for the fulfillment of its objective.
6. Organization of the Agency
The Agency shall have:
1/ a Board of Management (hereinafter the “Board”),
2/ Director General and, as may be necessary Deputy Director Generals to be appointed by the government, and
3/ the necessary staff.
7. Members of the Board
1/ Members of the Board shall be equally represented from the government, private organizations and the employees of the private organizations; and their number shall be determined as may be necessary.
2/ The Chairperson and government representatives shall be assigned by the government. The election procedure ,applicable’ to representatives of private organizations and employees shall be determined by government.
3/ The· Director General of the Agency shall be member and secretary of the Board.
8. Powers and Duties of the Board
1/ The board shall oversee and supervise operation of the Agency
2/ Without limiting the generality of sub-article (1) of this Article, the Board shall have the powers and duties to:
a) approve the strategy, plans, budgets and performance reports of the Agency:
b) submit to government, for approval, general policy matters regarding the Private organizations’ employees pension scheme and fund;
c) approve directives of the Agency to be issued pursuant to sub-article (2) of Article 5 of this Regulation.
9. Meetings of the Beard
1/ The Board shall meet once in every three months: provided, however, that it may meet at any time as may be required.
2/ There shall be a quorum where more than half of the members are present at a meeting of the Board.
3/ Decisions of the Board shall be passed by majority Vales of the members present at a meeting; provided, however, that the Chairperson shall have a Casting vote in case of a tie.
4/ Without prejudice to the provisions of this Article, the Board may adopt its own rules of procedure
10. Powers and Duties of the Director General
1/ The Director General shall be the chief executive officer of the Agency and shall, subject to the general directives of the Board, direct and administer activities of the Agency,
2/ Without limiting the generality of sub-article (1) of this Article, the Director General shall:
a) exercise the powers and duties of the. Agency. specified in Adele 5 of this Regulation.;
b) employ and administer employees of the Agency in accordance with the federal civil service laws;
c) prepare and submit to the Board the strategy, plan and budgets of the Agency and implement same upon approval;
d) effect expenditure in accordance with the approved budget of the Agency;
e) represent the Agency in all its dealings with third parties;
f) submit performance and financial reports of the Agency to the Board and, upon approval, to the concerned government bodies,
3/ The Director General may delegate part of his powers and duties to the officer and other employees of the Agency to the extent necessary for the efficient performance of the activities of the Agency
11. Budget
The Budget of the Agency shall be allocated from the pension fund; provided however, that the government shall allocate initial budget to commence operation.
12. Books of Account
1/ The Agency shall keep complete and accurate books of a Accounts.
2/ The books of accounts and financial documents of the Agency shall be audited annually by the Auditor Genera! or by auditors appointed by him,
13. Effective Date
This Regulation shall come into force ill’ on the date of publication in the Federal Negarit Gazeta.
Done at Addis Ababa, this 25th day of March 2011,
MELES ZENAWI
PRIME MINISTER OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA
University lecturers in Ethiopia do not have a legal right to pension
University lecturers in Ethiopia do not have a legal right to pension
It may be surprise news for most university lecturers in Ethiopia
to hear that they are not covered by the recent public pension law. The Public Servants’
Pension Proclamation No. 714/2011 generally provides pension coverage to
“public servants.” who are of Ethiopian nationals. University
lecturers, mainly those in the public universities qualify the definition of
public servants, hence should have been entitled to pension. The problem is not
all public servants have a legal right to pension according to the Public Servants’
Pension Proclamation.
Public servant is defined in article 2 sub 1 as
“a person permanently employed in any public office, and includes
government appointees, members of parliament, members of the defense force and
the police.”
Does this definition consider an academic staff of a public
University as a public servant? Thanks to the wider definition of public office
in article 2 sub 5 we may safely conclude that an academic staff is a public
servant. Article 2 sub 5 defines a public office as “any government
office, institution or organ wholly or partly run by government budget, and
includes public institutions and enterprises run by their own income”
However, Even though university lecturers are public servants,
they are not still legally qualified to pension coverage. A public servant for
the purpose of pension coverage includes only those who are “permanently employed”
(article 2 sub1 of proclamation no 714/2011)
By way of conclusion, since university lecturers are not permanent
employees of the institution, they can not legally claim pension coverage based
on proclamation no 714/2011.
The fact that tenure employment is a privilege not a right has
been made clear by the higher education proclamation no 650/2009. According to
article 33 sub 1, tenured employment of academic staff constitutes a privilege
to be attained through meritorious continuous service and outstanding scholarly
teaching and/or research or institutional leadership achievements as an
incentive to encourage academics to continue to excel in their professions.
A tenured academic staff in addition to his entitlement to
pension, shall have job security, and may not be dismissed from his position
unless he has committed a serious breach of discipline as stipulated by the
senate statutes of the public institution.
The most surprising (may be confusing) fact is not the absence of
legally recognized right to pension for academic staffs of public university.
In practice, pension contribution is collected from all university
lecturers. To make it clear, even though they are not legally entitled to
pension, practically pension contribution is deducted from their salary every
month.
Amount of pension contribution in the new Ethiopian pension laws
One of the significant changes introduced by the new Ethiopian pension laws is the substantial increase in the amount of pension contribution by the beneficiary and the government/employer. Until June 2011, only the public sector was covered by the pension scheme. Starting from July 2011 those (employees and employers) in the private sector will start making a contribution following the first private organization employees pension law. So what is the amount to be contributed by employees, employers and the public organs (the government)? The following table summarizes the contributions to be made from each respective party according to the proclamation no.714 and 715.
In the previous (now repealed pension law) the amount of pension contribution by public servants including military and police officers was 4% of their gross salary. However, there was a significant variation in the contribution to be made by the government for public servants as compared to the contribution to military and police officers.
According to article 5 and 6 of the repealed Public Servants’ Pensions Proclamation No. 345/2003 the contribution of the government to public servants pension was 6% whereas it was 16% for military and police pension.
The same variation is also reflected in the new public servants proclamation no 714/2011. The 16% government contribution has now risen to 25%, almost 1/4th of the gross salary of military and police officers. On the contrary the government contributes only 7% for public servants.
Just refer to the following table for the specific percentage of contribution by each of the parties with the responsibility of pension contribution under the new pension laws.
Note:
- NA= Not Applicable
- In order to calculate 1st 2nd 3rd and 4th year the time to start is July 1 2011
- The percentage is calculated based on the gross salary of the employee i.e. before deduction of tax and other encumbrances. Salary does not include hardship allowance, transport allowance, house allowance or other related benefits attached with certain position.
Download pension contribution table
Private Organization Employees Pension Proclamation No. 715/2011
Related posts
A PROCLAMATION TO PROVIDE FOR PUBLIC SERVANTS’ PENSION PROCLAMATION No. 714/2011
PUBLIC SERVANTS SOCIAL SECURITY AGENCY ESTABLISHMENT REGULATION No. 203/2011
Resignation and the paradox of Ethiopian pension law
Amount of pension contribution in the new Ethiopian pension laws
University lecturers in Ethiopia do not have a legal right to pension.
PROCLAMATION NO. 715/2011
A PROCLAMATION TO PROVIDE PENSION OF PRIVATE ORGANIZATION EMPLOYEES
Download Private Organization Employees Pension Proclamation No. 715/2011
WHEREAS it is part of the country’s social policy to expand the social security system and reach citizens step by step;
WHEREAS the strengthening and sustainability of the system greatly contributes to social justice, industrial peace, poverty reduction and development;
WHEREAS it has been found necessary to put in
place private organization employees pension scheme;
NOW, THEREFORE, in accordance with Article 55(1) of the Constitution of the Federal Democratic Republic of Ethiopia, it is hereby proclaimed as follows:
PART ONE GENERAL
This Proclamation may be cited as the “Private Organization Employees Pension Proclamation No. 715/2011”.
2. Definitions
In this Proclamation, unless the context otherwise requires:
1/“private organization employee” means a salaried person permanently employed in any private organization;
2/“permanent employee” means an employee hired for an indefinite period in accordance with the definition assigned to it under the Labour Proclamation No. 377/2003;
3/ “private organization” means an organization established to engage in commerce, industry , agriculture, construction, social service or in any other lawful activity and which has salaried employees and includes charities and associations;
4/“government” means the federal government and includes the regional states of the Federal Democratic Republic of Ethiopia;
5/“region” means any state referred to in
Article 47(1) of the Constitution of the Federal Democratic Republic of Ethiopia and includes the Addis Ababa and Dire Dawa city administrations;
6/“private service” means service rendered by employees of private organizations;
7/“benefit” means retirement pension, invalidity pension, incapacity pension or survivors’ pension and includes gratuity and the refundable pension contribution;
8/“salary” means monthly salary received by the employees of private organization, for services rendered during regular working hours without the deduction of any amounts in respect of income tax or any other matter;
9/“beneficiary” means an employee of private organization or his survivor who receives benefits or fulfils the conditions for receiving benefits in accordance with this proclamation.
10/“survivor” includes persons mentioned under
Article 39(3) of this Proclamation;
11/“private organization employees pension scheme” means a system established to pay benefit and provide service to employees covered by this Proclamation;
12/ “pension fund” means fund established for the purpose of collecting pension contributions and effecting benefit payments pursuant to this Proclamation;
13/“Agency” means the Private Organization
Employees Social Security Agency established by the Council of Ministers Regulation No. 202/2011;
14/“person” means any natural or juridical person;
15/any expression in the masculine gender includes the feminine.
3. Scope of application
Without prejudice to the appropriate provisions of the Proclamation No. 270/2002 that provide pension coverage to foreign nationals of Ethiopian origin and international agreements to which the country is a party, this Proclamation shall be applicable to employees of private organizations who are Ethiopian nationals.
2/ Notwithstanding the provision of sub-article
(1) of this Article:
a)employees, who have pension scheme or provident fund before the coming into force of this Proclamation, may either decide to continue to benefit from the pension scheme or the provident fund or agree to be covered by this Proclamation;
b)employees of religious organizations and political organizations and persons engaged in the informal sector shall, upon their consent, be covered by this Proclamation.
3/ Notwithstanding the provision of sub-article
(1) of this Article, this Proclamation shall not be applicable to:
a)domestic workers; and
b)employees of governmental international organizations and foreign diplomatic missions.
Download Private Organization Employees Pension Proclamation No. 715/2011