Industrial Court has ordered the Pensions Alliance Limited to pay retiree Mr Ofunlana Oladimeji the sum of N8,608,464.36 (Eight Million, Six Hundred and Eight Thousand, Four Hundred and Sixty-Four Naira and Thirty-Six Kobo) Retirement Savings outstanding balance, and the sum of N1m general damages.
The Court held that the Pensions Alliance Limited has not justifiably established in view of the circumstances why Mr. Oladimeji cannot withdraw a lumpsum of his pension contribution at an additional rate of 25% making it the rate of 50% since there is no indication of the life expectancy used for the computation of programmed monthly withdrawal before the retiree was bench-marked for 25%.
From facts, the Claimant- Mr Ofunlana Oladimeji had averred that as a 50-year-old retiree and upon payment of the 25% lump sum of his total retirement savings, he entered into a Programmed Withdrawal Agreement with the Pensions Alliance Limited to enable him utilize the outstanding pension funds by way of monthly or quarterly withdrawal and the defendant was to manage the pension funds standing to the credit of the claimant’s Retirement Savings Account (RSA) until termination of the said agreement.
Mr Oladimeji contended that in line with the decision of the Industrial Court on the judgment delivered on 18th May 2020 which upheld that a retiree above 50 years is entitled to be paid a 50% lump sum of his retirement savings, he applied for payment of additional 25% of his total retirement savings for the payment of his son’s school fee and the defendant rejected his request.
In defence, the defendant- Pensions Alliance Limited averred that Mr. Oladimeji requested a withdrawal of 25% of his existing balance in the RSA in contravention of the extant PENCOM regulations. The defendant stated that they were not parties to the judgement mentioned by the retiree and that it is bound by the provisions and requirements of the Pension Reform Act 2014 and PENCOM directives and regulations.
The Pensions Alliance Limited stated that they did not violate any provision of the Programmed Withdrawal Agreement or any judgment of the Court and that the alleged unilateral termination of the Programmed Withdrawal Agreement by Mr Oladimeji was wrongful, and urged the Court to dismiss the case in its entirety.
In opposition, the Claimant’s counsel, D. D. Duru Esq. stated that the non-payment of the additional 25% requested lumpsum is evidence of the wanton disregard and disrespect to the demand of his client and contrary to the decision of the court as decided in the past, and urged the Court to grant the reliefs sought in the interest of justice.
In a well-considered judgment, the Presiding judge, Justice Sanda Yelwa reasoned that the provision of section 7(1) (b) of the Pension Reforms Act stipulates that the programmed monthly or quarterly withdrawal is to be calculated based on an expected life span projection, that it is incumbent on the Pensions Alliance Limited to make it clear to all and sundry the expected life span that was used in the computation and the failure to so do has shrouded the computation with incongruity.
The Court held that Pensions Alliance Limited has not justifiably established in view of the circumstances why the retiree cannot withdraw a lumpsum of his pension contribution at an additional rate of 25% making it the rate of 50% since there is no indication of the life expectancy used for the computation of programmed monthly withdrawal before the Claimant was bench-marked for 25%.
Justice Yelwa reiterated that upon a proper construction of the provision of section 7 of the Pension Reforms Act, the Revised Regulation on the Administration Retirement and Terminal Benefit, Mr Oladimeji is entitled to terminate the Programmed Withdrawal Agreement as the defences put up by the Pensions Alliance was very porous to deny Mr Oladimeji his entitlements.
“Having clearly stated the foregoing, I must mention that I am not oblivious of the decisions of my learned brother which was placed before this court for consideration and in that regard, I must reiterate as I had earlier posited that the decisions are only of persuasive capacity and not binding. The foregoing analysis is not exactly a predication on any of the authorities although I reckon that Hon. Justice O.O. Oyewumi (J) (as then he was) in MAROOF’s case also alluded on page 17 of the judgment to the use of the life expectancy as stipulated by the WHO to compute the Claimant’s pension in order to determine the lump sum to be withdrawn and I must state that I am very much persuaded by the analysis made in that regard.” The Court ruled
