Insurance - Preparing-End-of-Career Indemnity

Several companies have been sensitised on how to pay them without much spending. Senior management staff of companies across the country have embraced easier ways of paying indemnities to retiring workers without having to be stressed up by heavy disbursements, which often affect companies during massive lay-offs.

A seminar, which held at the GICAM headquarters in Douala on Thursday October 11 on the theme, "End-of-career indemnity for optimum financial and human resource management of companies", falls in line with the Cameroon Insurance Association, ASAC's (organiser) objectives to sensitise companies about how the terms of the Collective Agreement can be applied, especially as the insurance companies have a solution in the form of an insurance product.

It was an opportunity to present this product to the financial directors, human resource managers and general managers. The sensitisation is a win-win situation to the workforce. Employers and ASAC presented the product that was still little known to companies which can take advantage of it. Rather than wait to pay indemnities which are social rights accumulated over the years, insurance structures and companies signed a Collective Agreement in which indemnities or social rights of private sector workers will be paid. Law n°92/007 of August 14, 1992 on the Labour Code authorises the establishment of collective conventions and agreements, as provided for in articles 52 to 60. Going by the arrangement, companies were supposed to regularly contribute the indemnities of their employees to insurance companies. In the accounting systems of companies, provisions are to be made for these allowances that have to be paid.

To the President of the Cameroon Insurance Association, the advantage is that the premium paid is tax deductible if a company subscribes to this insurance product. Martin Ndikum Foncha further says, "the product also gives the company the advantage of not paying a lot of money when there are massive lay-offs." Subscribed companies pay following the terms of the agreement. It goes a long way to prevent discontent which results sometimes to angry protest demonstrations, when employees retire without receiving their indemnities or social rights in time.