The Fiji National Provident Fund (FNPF) is set to introduce significant changes to its penalty structure for late contribution payments, starting from January 1, 2025. These revisions follow the approval of changes to the FNPF Act 2011 by Parliament in July 2024.
The existing penalty system, which has been in effect since November 2011, imposes a flat fee of $100 per employee per month for late payments. Under the new system, a 10% monthly penalty will be levied on outstanding contributions, including those due for December 2024. This penalty will be calculated based on the balance of unpaid contributions and will continue to accrue each month until the debt is resolved.
FNPF Chief Executive Viliame Vodonaivalu highlighted that the updated penalty framework is designed to be fair and manageable, especially for micro, small, and medium enterprises. He noted that the previous one-size-fits-all penalty regime no longer aligns with the evolving business environment.
Moreover, all penalties collected under the new system will be directed to the affected members’ accounts, ultimately strengthening their retirement savings. Alongside these changes, employers will be required to submit their Contribution Schedules by the 14th of each month, a move intended to give them more time to manage invoice processing before the end-of-month deadline.
To assist employers in clearing their outstanding debts before the new penalties are enforced, FNPF is offering a Penalty Waiver Amnesty until December 31, 2024. During this period, employers who pay their outstanding contributions and any applicable Loss of Interest (LOI) will have their penalties waived. Those who miss this opportunity will face both the current $100 per employee penalty for November 2024 contributions as well as the new 10% penalty on December contributions.
These changes promise to create a more equitable and manageable framework for all employers while encouraging timely contributions to benefit the workers’ future savings.
Summary: The FNPF plans to implement a new penalty system for late contribution payments from January 1, 2025, shifting to a 10% monthly penalty on outstanding debts. This change aims to provide relief for smaller businesses and direct penalties towards members’ accounts to enhance their retirement savings. An amnesty period until December 31, 2024, is being offered for employers to clear outstanding contributions without penalties.
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