Around 400 employees of the Foundation for Social Welfare Services who were on the payroll of this State entity between 2000 and 2007 when it was under the helm of Joseph Gerada, had their social security contributions missing as their employer failed to make the payment despite deducting the among from their salary. According to a preliminary investigation into this blatant breach of the employment law the overall amount involved is close to €10 million. Employees having these contributions missing may end up with a lower pension and might even miss out on the sickness benefit payment.

The case came to light when FSWS employees reaching retirement age enquired on their pension, only to be given the shocking news that they did not qualify for the amount which they were supposed to be entitled for.  

This portal can confirm that the matter has been flagged with UHM Voice of the Workers which is taking up the issue with the Foundation.

Ministry says employees’ pensions will not be affected

In a terse reply to Voice of the Workers Weekly, the Social Policy Ministry which is politically responsible for this Foundation confirmed that an internal investigation had been launched and that further steps would only be taken when the findings of this probe would be in hand. The Ministry did not reply when asked if the position of Joseph Gerada, the former FSWS CEO who is still the Foundation Chairperson and a consultant to the same Ministry, had become untenable. Moreover, no explanation was given on why the matter had been left under wraps for almost 20 years. Yet, the Ministry insisted employees would not be negatively impacted as “adjustments were being made” by the Social Security Department to rectify the situation.

Meanwhile, this portal sought an explanation from Gerada himself and whether he had ever flagged the issue to the ministry to prevent affected employees landing in hot water, but no reply was received by the time of writing.  

On his part incumbent FSWS CEO Alfred Grixti reiterated the ministry’s assurance that none of the employees involved would end up missing out on part of their pension. “Myself, the senior management team of the Foundation and the Ministry are committed to solve the matter in the shortest time possible while assuring that none of the employees involved will lose any rights with respect to their pension and other social benefits”.

Citing from correspondence received from the Permanent Secretary of the Social Policy Ministry, Grixti said he had been instructed to discuss the matter with the Social Security Director General Grazio Barbara to find a solution.

€9.6 million is a ‘conservative’ estimate

Asked on the course of the investigation so far, the FSWS CEO noted that it was difficult to establish the exact number of employees involved “since no records of finance and payroll are available prior to 2008” as they had been farmed out to a private service provider.

It also transpires that originally there were 398 employees with missing NI contributions and only 20 who had everything in order. Over the years, 168 had regularised their position mostly when they were nearing retirement age or when they applied for the sickness benefit as they were alerted on the situation. However, only those who were still in possession of their original payslips dating back to those years could address the situation. The rest of the affected employees who total 210 are still listed as having missing contribution even through in actual fact this amount had been deducted from the salary.

Grixti said that according to a “conservative estimate” the overall value of these missing contributions was in the region of €9.6 million.

Asked if a separate investigation would be launched to find who was responsible for this gross shortcoming in governance, the FSWS CEO declined to pronounce himself saying this was a decision which he could not take by himself.