Tribunal upholds ruling against employer over WhatsApp provident fund dispute.
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The Financial Services Tribunal has dismissed an application by Sibisi Conveyor Products (Pty) Ltd to overturn a ruling ordering it to pay outstanding provident fund contributions for an employee, finding that informal WhatsApp discussions could not lawfully terminate fund membership while the employee remained employed.
The tribunal recently upheld an earlier determination by the Pension Funds Adjudicator (PFA) against the company in a dispute involving former employee Gustav Oosthuizen and the Discovery Life Provident Umbrella Fund.
The matter centred on whether Oosthuizen had validly withdrawn from the provident fund while still working for the company, thereby ending the employer’s obligation to continue making contributions on his behalf.
The tribunal panel found that the employer failed to provide any evidence that the employee had formally withdrawn from the fund in accordance with its rules. Instead, the company relied primarily on WhatsApp exchanges between Oosthuizen and the company’s former chief executive officer, arguing that the conversations showed the employee no longer wished to contribute to the provident fund.
According to the ruling, the company accepted that provident fund contributions had been paid between January and March 2024 after Oosthuizen became a member of the fund. However, it argued that contributions stopped after March 2024 because Oosthuizen allegedly requested to be removed from the fund.
The tribunal rejected this argument, stating that no signed withdrawal forms, formal election documents or confirmation from the fund existed to show that Oosthuizen’s membership had legally ended.
The ruling emphasised that clause 3.6 of the fund rules expressly prohibited members from withdrawing from the fund while remaining employed, unless the rules specifically allowed for it. The tribunal further pointed to Section 13 of the Pension Funds Act, which makes the rules of a registered pension fund binding on employers, employees and the fund itself.
The panel held that the WhatsApp exchanges merely reflected discussions about salary deductions, affordability concerns and the company’s financial difficulties, rather than a lawful termination of fund membership.
“The exchanges do not, however, constitute a withdrawal from membership in terms of the rules,” the tribunal stated, noting that there was no indication the fund itself had processed or accepted any withdrawal request.
The company also argued that the proceedings before the PFA had been procedurally unfair because correspondence relating to the complaint had allegedly been sent to an email address that was no longer properly monitored.
The tribunal dismissed that complaint, finding it contradictory that the company claimed it had not received earlier communications but later successfully received the adjudicator’s determination at the same email address and used it to launch reconsideration proceedings.
The tribunal said the employer had failed to establish any factual or legal basis for interfering with the adjudicator’s ruling and confirmed that the company remained liable for outstanding provident fund contributions together with interest.
The original adjudicator’s determination had already drawn a distinction between deductions made between July and December 2023 and those made from January 2024 onwards.
The adjudicator found that the earlier period fell outside its jurisdiction because Oosthuizen had not yet become a fund member during that time. However, once membership commenced in January 2024, contributions became compulsory under the fund rules.
In the final order, the tribunal dismissed Sibisi Conveyor Products’ reconsideration application in its entirety, effectively confirming the earlier ruling requiring payment of the outstanding provident fund contributions.
sinenhlanhla.masilela@iol.co.za
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