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Pension Funds Act, 1956 (Act No. 24 of 1956)

Chapter IV : Documents to be Deposited with Registrar

15J. Use of employer surplus to prevent job losses

 

(1) A fund may apply to the registrar for permission to pay any credit balance in an employer surplus account to an employer where negotiations in terms of section 189 of the Labour Relations Act, 1995 (Act No. 66 of 1995), have confirmed the need to retrench employees if additional capital is not obtained: Provided that an independent auditor may be required by the fund to certify such need.

 

(2) The application must be made to the registrar in the prescribed manner.

 

(3) The registrar may only grant an application, and issue a certificate to the applicant to the effect that the requested payment may take place, if the registrar is satisfied that—
(a) members have had full disclosure of the current financial position of the fund and the proposed distribution to the employer, and the need of the employer for additional capital in order to maintain employment, together with the report of the independent auditor, if any, and any information that members may require to exercise their rights under the Labour Relations Act, 1995 (Act No. 66 of 1995);
(b) members have had a reasonable opportunity to consider the proposal;
(c) at least 75 per cent of the members currently in employment have approved the proposal, in writing; and
(d) negotiations in terms of section 189 of the Labour Relations Act, 1995 (Act No. 66 of have confirmed the need to retrench more than 10 per cent of the membership of the fund at the previous financial year end if the payment is not made.