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Compensation scheme as elixir for higher productivity


 Ismail Agaka

Ismail Agaka

There is no doubt that the present economic recession poses different challenges to both workers and employers. Indeed, while employers are out at this time exploring ways of cutting costs and seeking ways of increasing bottom-line via enhanced productivity, the search for these objectives is often located within the traditional areas such as salaries, allowances and threat.

Little attention is paid to ensuring the safety of workers in the workplace as an incentive that can boost the productivity of workers through confidence building process. It is even more ironic when chief executive officers think that promoting safety in the workplace is meant for the benefit of workers only.

This may simply not be true, according to the Acting Managing Director of the Nigeria Social Insurance Trust Fund (NSITF), Ismail Agaka.He explained that the same goes for the Employees Compensation Scheme (ECS) that is largely seen as a scheme for employees.

The NSITF boss stressed that it is undeniably erroneous for employers to think that the scheme is for the benefit of employees alone saying, “everybody is exposed to one form of occupational hazard or the other in the workplace. So, it is not a question of it does not concern me.”

He argued that joining a scheme that promises treatment and rehabilitation of injured workers in the course of work is a huge incentive for higher productivity.

“Joining this kind of scheme boosts the moral of the employees without shouting it. Boosting the moral of employees is more than just increasing the salaries and allowances,” he said.

The NSITF boss also highlighted that the higher productivity in the workplace clearly manifests in the bottom-line of organizations.His words: “Higher bottom-line means more money coming into the company. It will also lead to better industrial climate in the workplace. A harmonious industrial relation in the country would lead to national cohesion. The burden of care is transferred to the NSITF for an employer should there be any workplace accident, injury, disability or occupational disease. The scheme helps employers overcome unanticipated expenditure especially if such comes when the organization is not financially strong enough for such expenses. How do organization address this kind of development during cash flow challenge? Such development could lead to employees seeing their employers as wicked and uncaring regardless of challenges such employer may be going through.”

Speaking on the benefits inherent in the scheme, Agaka highlighted that compensation also applies to victims of plane crashes who lose their lives in the course of work.

His explanation: “First, if the employer of such a victim of plane crash was registered, the survivor of such a person would be compensated. Secondly, the journey must be in the course of carrying out official duty. If it is confirm that it was an official trip in the course of work, then the next of kin or the dependent of the deceased employee is covered. Indeed, many such claims have been processed by the NSITF.”

While explaining that the NSITF does not operate hospitals where injured workers are treated, he explained that medical bills incurred by organizations for the treatment of injured workers are settled and that NSITF takes over the treatment if it is long term.

“If there is an accident, the employer owes his or her employee the duty of care by offering that employee at least first aid treatment. It is after the stabilization of the worker that the office now reports to the NSITF and then the process begins.Whatever medical expenses might have been incurred prior to reporting to the NSITF is refunded. If there is any need for the employee to obtain further rehabilitation as the case may be, it is the responsibility of the NSITF. But the first point is that the employer must be registered on the scheme and also the accident must also be reported to the Fund through a laid down procedure,” he stated.

He explained that the Act establishing the ECS only recognizes up to four children as the maximum number of beneficiaries. He added that there is a family whose breadwinner died that presently receives up to N1.3million monthly as compensation under the scheme.

Agaka said: “We have a family whose breadwinner died and after the computation of the entitlements, we are now paying up to N1.3million monthly to the beneficiaries. That represents 90 per cent of the last income of the deceased breadwinner.”

The NSITF boss said as against the pension scheme where individuals can increase the rate of contribution, there is no such provision in the employees’ scheme.

He explained: “The scheme is for people that are working only and not for retirees. There is also no provision for any employees to register on their own. Every worker willing to register must come through an employer because the scheme is employers’ obligation.”

Agaka hinted that the NSITF is presently reviewing its contribution rates to serve as an incentive to employers who have recorded low accidents in the workplace while also raising the rate of more susceptible sectors of the economy.

“We are in the process of reviewing our rate of contribution to reflect the risk exposure of organizations. While there is risk rating, there would also be merit rating. Merit rating is reviewing downwards the contribution of those that are regular in their contributions and are not in the habit of filling claims for compensation periodically,” he said.

Agaka stated that the scheme has so far registered 45,000 employers, paid over N700million as compensation to over 6,000 workers that sustained various degrees of injuries in the course of work.

The NSITF chief also said there is a fresh vigour to sensitize the trade unions as well as employers on the need to enrol workers on the scheme.
Again, he said: “One of our major challenges mainly is that we have not sensitized our publics enough. But we are now embarking on an aggressive enlightenment of our publics that included the trade unions and employers of labour. We are also talking to the state governments telling them the benefits of the ECS.”

Specifically, Agaka lauded Bauchi state government for taking step to enroll its workforce on the scheme just as NSITF is dialoguing with more states to come on board.

He added: “Bauchi state is already registered on the scheme and will soon begin contributing. The process of its contribution is still in the works and we expect the details to be finalized very soon.

“We have received invitation from many states to make presentation to them on the scheme. We indeed have met with the Lagos State government officials and are now in the process of getting them registered on the scheme. The management is also talking with Edo and Zamfara states with a view to getting them on board soon,” he stressed.

The NSITF helmsman also decried the negative impact of the economic recession on the implementation of ECS saying, “the reigning economic challenge has also limited our reach in terms of collecting contributions from employers. There are some employers that have to close shop amongst those that have registered while those that have not closed shop, have had to reduce their workforce drastically or reduce staff salaries because contribution is a function of the payroll of organizations. Therefore, the reduction of staff or their salaries will affect the amount of contribution into the scheme directly.”

He also disclosed that the National Assembly might soon organize a public hearing on the expansion of NSITF mandate to execute more social security initiatives.

“There is a bill in the National Assembly for the amendment of the NSITF Act for it to execute other programmes apart from the employees Compensation Scheme. That bill has gone very far in the legislative process. What we are waiting for now is the public hearing on it,” he explained.

In this article:
Ismail AgakaNSITF
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