Cosatu fumes as pension fund debt puts workers at risk!

THE Congress of South African Trade Unions (Cosatu) has slammed employers who fail to pay over workers’ pension fund contributions, saying the growing crisis puts about 590 000 workers’ retirement savings at risk.

According to the latest Financial Sector Conduct Authority report, the number of employers, who have defaulted on pension fund contributions, has climbed to 16 556 by the end of February 2026, up from 15 521 recorded in September 2025.

The total amount owed has also ballooned by R1,04 billion to R8,33 billion, with late payment interest now making up 43,5% of the total arrears.

Cosatu said despite recoveries of R1,01 billion since the FSCA first started reporting on the matter in June 2022, the outstanding amount remains unacceptably high.

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“The total arrears are still far too high and risk plunging more than half-a-million workers into poverty retirement.

“More than an injustice, this is a crime against workers whose sweat of the brow is toyed with by these unscrupulous employers,” said the union federation.

Cosatu expressed particular concern over municipalities, saying they deducted R1,7 billion from workers’ salaries but failed to transfer the money to pension funds.

The federation said municipal workers have also been forced to endure unpaid salaries for months while their pension contributions remain in arrears.

“When pension fund contributions are in arrears, workers’ death and disability benefits become void with devastating consequences for the workers and their families,” it said.

The federation reminded employers that failure to pay pension fund contributions is a violation of Section 13A of the Pension Funds Act, which requires contributions to be paid within seven days after month-end.

Those not complying are breaking the law and if prosecuted, will be liable for a fine and can even be jailed. They are thieves, plain and simple

—  Cosatu

While welcoming measures by National Treasury and labour inspectors to improve compliance, Cosatu said stronger action is needed.

“This crisis will, however, not end until delinquent employers are charged and prosecuted for the theft, fraud and corruption that this mass looting is.

“Cosatu will engage unions of affected workers to begin laying charges with the police,” said the federation.

It added that it will intensify efforts to report defaulting employers and ensure all outstanding pension contributions, including interest, are recovered.

Source: https://www.snl24.com/news/cosatu-fumes-as-pension-fund-debt-puts-workers-at-risk-20260717/