Abstract

This article evaluates an extraordinary remedy created by the legislature in s 37D(1)(b)(ii) of the Pension Funds Act 24 of 1956. This provision enables employers, who are able to satisfy retirement funds boards that they have suffered economic harm at the hands of their employees’ who are members of such retirement funds, to be compensated from liable members’ retirement benefits. It is demonstrated in this article that, by and large, the practical application of this section has been driven by the courts and the adjudicator, both of whom have interpreted this provision to include aspects that are not explicitly included in it, such as the retirement fund’s power to withhold benefits at the request of employers. It further demonstrates that there are several critical duties that are not explicitly described in any of the provisions of the Pension Funds Act which courts (and other tribunals) have held must be observed by boards when considering withholding members’ retirement benefits. In this article, these duties are critically evaluated with a view to recommending necessary amendments to s 37D(1)(b)(ii) of the Pension Funds Act.