Norrenberger struggles with legacy pension obligations after IEI acquisition

BUSINESS A.M. REPORTER

Norrenberger, the Abuja based financial services group which acquired International Energy Insurance Company (IEI) in April 2022, appears to be caught in the thicket dealing with the knotty issue of legacy pensions that have emerged since the acquisition.

Business a.m. learnt over the weekend from people familiar with the situation both inside and outside of IEI that there appears to be a raft of confusion over the matter as many past and present employees have various issues that are yet unresolved over their pensions.

Those who spoke to Business a.m. said that there is a lack of clarity over how Norrenberger is approaching the matter with the company yet to come out to say whether or not it is repudiating legacy pension liabilities that were part of an “assets and liabilities” acquisition transaction that was concluded last year.

The confusion over past and present IEI staff pensions have been expressed in different forms, including some who claim that deductions made over the years appear not to have reached the pension fund administrators (PFAs). In other cases, the amount of deductions made from affected persons do not match with what is recorded in individuals’ accounts with the PFAs.

Business a.m. has seen a memo sent by people affected by the development, including current and former staff, to the management of the succeeding owners detailing various confusing aspects of the matter.

Specifically, the authors of the memo drew the attention of the management of Norrenberger to the fact that the acquisition involved assets and liabilities.

The situation stems from the fact that following Norrenberger acquisition of the IEI last year the new owners had moved in to take possession of their new assets and began the implementation of their turnaround strategy for the once troubled insurer. This had also involved the laying off of some management and employees.

But the pension debacle which has affected quite a number of people at different levels in the organisation past and present, appears to date back to deductions that happened in 2016.

“The Mandatory Contributory Pension deducted from staff salary between November 2016 to December 2021 were not remitted to staff respective pension fund administration (PFA) thereby denying ex-staff ability to access their pension,” the memo read.

The memo also noted that some ex-staff who have approached IEI Plc with the intention of getting their outstanding pension remitted have not been successful.

They noted that the new IEI management had claimed on some occasions that it had fully paid all the pensions of an ex-staff, only for the staff to find this not to be correct when they checked with their PFA.

“This position is at variance with the actual position,” they wrote in the memo, adding, “[a] copy of [the] same staff pension statement from 2016 to 2023 is also attached which shows that pension was not remitted between November 2016 to December 2021.”

The petitioners drew the attention of the new management of IEI and the new owners to the fact that the “affected ex-staff of IEI have served the company in various levels and time, as such they are rightfully entitled to their Mandatory Contributory Pension which they should not be denied.”

The affected staff who have been chasing closure to the pension issue since before July, officially drew the management’s attention praying that “all the outstanding compulsory contributory pension between November 2016 to December 2021 should be remitted to the ex-staff various PFAs contained in your records,” they demanded

They had sent along with the memo a detailed schedule showing among other information, names, number of months pension was not remitted, average monthly remittance, total amount due to individuals.

They also enclosed individual pension statements obtained from various PFAs, showing non-remittance between November 2016 to December 2021 depending on when each staff exited the company.

The memo to the new IEI managers also drew special attention to the fact that some ex-staff who were privileged to be employed have their pension contribution remittance continued from date of employment by the new employers.

“We believe that the attachments will be sufficient to convince you of non-remittance of ex-staff pension during the period stated above and will enable you to do the needful,” they concluded.

Business a.m. learnt that since the memo was written not much has changed as ex-staff and some retained staff are yet to have their issues resolved.