by Dr Lawrence A Joseph
Questions have been raised by many as to whether public officers have a constitutional right to pensions and gratuities and if so what is the extent of that right.
In order to have a proper understanding of these questions it is important to have a review and interpretation of the Constitution of Grenada and of the related Acts of Parliament. Public officers are paid by the government and include workers in the general public service, teachers in various schools, police officers and prison officers. Specific Acts of Parliament cater for these persons:
- the Pensions Act (1950) Cap. 233 caters for public officers in the general public service;
- the Pensions (School Teachers) Act (1943) Cap. 236;
- the Police Pensions Act (1931) Cap. 245; and
- the Pensions (Prison Officers) Act (1935) Cap. 235.
Sections 92 and 93 of the Constitution provide for the enactment of the abovementioned pension laws, the protection of pension rights and for how pensions for public officers may be regulated. Section 92 (2) (b) provides that the law to be applied for a person that commenced service after the enactment of the Constitution (that is, after 7 February 1974) “shall be the law in force on the date on which that period of service commenced ….or any law in force at a later date that is not less favourable to that person.”
It means that if the law is altered it must not be less favourable to that person who has an existing entitlement to pensions. However any pension law that is in place before commencement of service by any other public officer will be the effective law. Commencement of service refers to the appointment of a public officer by the Public Service Commission.
Dependent on the date of commencement of service the amounts of pension and gratuity payable to a retired public officer are regulated by either of the abovementioned act. A person may opt for full pension without gratuity or may opt for a reduced pension with gratuity. However adequate notice must be given to the Governor-General for the second option to be utilised. Regarding that option for a reduced pension an advanced pension (called “a gratuity”) amounting to 25% of eligible pension is immediately payable and the remaining 75% is to be paid over the period of retirement from the age of retirement. The advantage to the pensioner with this second option is that a reasonable amount of money is available up front. However the disadvantages are that actual monthly pension payments are much less than normal for 12 ½ years and future increments payable by government will go towards only 75% of pension.
It is to be noted however that all of the respective act provide that their provisions do not apply to public officers who commenced their service on or after 22 February 1985, that is the day upon which the Pensions (Disqualification) Act of 1983 which was passed by the unconstitutional People’s Revolutionary Government was subsequently validated by the constitutional Herbert Blaize government. Originally the date was set at 4 April 1983 but following the judgment in the Hermilyn Armstrong case in 2010 the date has since been amended. Presently persons who commence service after 22 February 1985 are entitled to only retirement benefits under the National Insurance Scheme (NIS), which situation existed for over 35 years from 1983.
Negotiations between the unions and government have been partially successful in that they agreed to increase the amount of pensions payable to retiring public officers from the original 66 2/3 % which was payable under the respective act to 70 % of their highest salary. This latter amount is anticipated to come from both government and the NIS. The bone of contention relates to the amount of “gratuity” that should be paid up front to pensioners if they opt for a reduced pension and gratuity. The unions are asking for 25% advanced payment while the government’s latest offer is 8%. A stalemate has been reached on the amount as the government claims that 25% up front is neither affordable nor sustainable.
As may be garnered from the above discussions, there is no absolute constitutional right to the receipt of pensions and gratuities by public officers. It all depends on what law is in place at the time of commencement of service by public officers. If at the commencement of service there is no law in place regarding any provision, then public officers within that range will not be entitled to pensions or gratuities. Section 92 (7) of the Constitution sets out clearly that legislation may lay down the circumstances in which such benefits may be granted, refused or reduced.
In fact all the respective act spell out that no officer shall have an absolute right to compensation for past services or to pension, gratuity or other allowance. However, the underlying principle regarding constitutional entitlement to pension and gratuities relates to whatever law is in place at the commencement of service.
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