Key Amendments to the Contribution-based Social Security Act, 2017 (2074 BS)

Key Amendments to the Contribution-based Social Security Act, 2017 (2074 BS)

Pursuant to Act to Amend Some Nepal Acts, 2025 (2082 BS)

The Act to Amend Some Nepal Acts, 2025 (2082 BS), published in the Nepal Gazette on 2082/04/14 (July 30, 2025), has introduced significant changes to the Contribution-based Social Security Act, 2017 (2074 BS) (“Social Security Act”).

Below is a summary of the key amendments to the Social Security Act:

1. Extension of Deadline to Deposit Contribution

Under Section 4 of the Social Security Act, employers enlisted with the Social Security Fund (“SSF”) are required to deposit the contribution amount to the SSF based on each employee’s contributable income. Previously, under Section 4(4) of the Social Security Act, the deadline for depositing such contribution amount was 15 days following the end of each month.

Amendment: This deadline has now been extended to 25 days, requiring employers to deposit the contribution amount to the SSF within 25 days following the end of each month.

2. Enforcement Actions for Non-Enlistment

Under 9(4) of the Social Security Act, if the enlisted employer fails to deposit the contribution amount to the SSF within the prescribed time, the following enforcement actions could be taken against the employer until it deposits the contrbution amount: (a) freeze the bank accounts, (b) freeze movable and immovable properties, (c) abrogate all the facilities received as per law, (d) cancel the license, and (e) freeze the passport. However, Section 9(4) did not prescribe any specific enforcement actions for non-compliance with the enlistment requirement.

Amendment: The scope for undertaking enforcement actions has been expanded to include cases where an employer fails to enlist itself or its employees with the SSF.

3. Employee’s Entitlement to Recover Benefits from Employer

A new provision has been added under Section 9(6) of the Social Security Act which provides that, “If an enlisted employer fails to deposit contribution amount within the prescribed time and an employee suffers an accident or dies during that period, the employer is required to pay the employee (or their beneficiary) an amount equivalent to the eligible benefits under the Social Security Act.”

4. Powers to Issue Orders

As per Section 17 of the Social Security Act, if an entity fails to enlist itself or its employees with the SSF, the SSF may (a) order the entity to immediately enlist itself or its employees with the SSF; and (b) require the employer to deposit the outstanding SSF contribution amount, including the 10% interest on it, for the period during which the employment relationship existed; or (c) if the employment relationship has already ended, the employer shall be required to pay the employee the amount equivalent to eligible benefits under the Social Security Act. However, Section 17 of the Social Security Act did not prescribe any specific sanctions for non-compliance with the obligation to make deposits of prescribed contribution amount to the SSF.

Amendment: The scope for issuing orders has been expanded to include cases where an employer fails to deposit the contribution amount to the SSF. Further, the authority to issue orders has been provided to the Executive Director.

Link : http://rajpatra.dop.gov.np/welcome/book/?ref=26046