A tribunal has directed the Standard Chartered Kenya Pension Fund to compute the benefits of more than 600 employees who retired from the bank.
Retirement Benefits Appeals Tribunal Chairman Charles Ongoto warned that it would adopt the claims presented by the retirees if the fund does not table its computations within seven days.
“The failure to complete the same at the lapse of the seven days, the appellants (retirees) will present their own actuarial report which would be adopted as the final computations by the tribunal,” the official said.
The retirees have been engaged in court battles with the trustees of the scheme for decades over their pension dues, which they claim were reduced.
However, as the tribunal gave the directive, the bank and the scheme signalled their intention to escalate the matter to the Supreme Court.
“Being dissatisfied with the decision of the Court of Appeal intends to move to the Supreme Court,” the notice by the bank and the scheme read.
On March 7, a bench of three judges of the Court of Appeal dismissed the appeal by the lender saying the High Court did not make any error by rejecting the bank’s case.
The pensioners sued their former employer and the scheme accusing them of reducing their lump sum payment. They had sought payment of Sh9 billion as the balance of the lump sum pension benefits plus interest and a refund of Sh1.1 billion, which was paid to the bank as surplus, which they said totaled Sh5.79 billion.
Before moving to the High Court, the tribunal had ordered the lender to disclose to the 629 former employees lump sum benefits and the actuarial methods used to re-calculate their retirement benefits.
Standard Chartered was ordered to factor in the cost of living adjustments, housing allowance, and future increases and payments.
The trustees of the scheme had appealed the decision, arguing by directing them to compute the benefits, the tribunal abdicated its adjudicative role and delegated it to the trustees and the bank, yet they were parties in the proceedings.
The lender and the trustees of the scheme sought the suspension of the tribunal’s verdict saying it would expose it to a Sh30 billion settlement for its retired employees.
The appellate court said the tribunal simply enforces the law as it ought in directing trustees to apply the law properly in its dealings.
“We find and hold that the orders made by the Tribunal requiring computation by the appellants as guided by its directions and requiring the RBA (Retirement Benefits Authority) to report to in compliance within 60 days were lawful orders and did not violate decisional law as laid down by the Supreme Courts in Mitubell case” it said.
The judges further said they were unable to find any basis for the scheme’s claim of violation of the provision of the Fair Administrative Action Act.
The retirees further said the conversion to a defined contributory scheme on January 1, 1999, resulted in a reduction of future accrual of benefits.
The pensioners further claimed that the Trustees failed or neglected to distribute the surplus to the members who transferred to the new Contributory Section of the fund.
