Answer to a question from a reader

Will a letter of authority compel the deceased's company to pay out her provident monies?

The short answer

No, you need to discuss the issue with the provident fund itself.

The whole question

Dear Athalie

My aunt worked as a security guard before she passed away in May 2021. The company is taking long to pay out her provident fund. They say all the kids over 18 and my grandmother must open bank accounts, but my grandmother is too sick to go to a bank. Would it be help for my aunt's firstborn to get a letter of authority from the court?

The long answer

There are two separate issues here: 

  1. The letter of authority;

  2. Getting the provident fund paid by the company where your aunt worked as a security guard.

The letter of authority is given to a family member to wind up the deceased estate – in other words, to pay off any debts and see that the right people inherit any money and property your aunt may have left. After a death is reported, the deceased person’s bank account is frozen and a new account must be opened by the person with the letter of authority, who must do all the work of winding up the estate. 

But the letter of authority will not help to get the company to pay out the provident fund. The provident fund is paid out according to the rules of the fund. Each fund will have its own rules, but in the case of the Government Employees Pension Fund (GEPF), for instance, they will make payments for minor children to the bank account of the children’s guardian, and to children between 18 and 22 years old into their own bank accounts.

So, they would not pay out the provident fund until the 18–22-year-old children opened their own bank accounts. There would also be forms that each one would have to fill in and sign.

Perhaps it would help if you and the firstborn went to the Human Resources office of the company where your aunt worked, and asked them to explain the whole process to you, and assist in the case of your grandmother who is too ill to open an account. You could ask them for a copy of the provident fund’s rules, and if there is anything you can do to hurry up the process. Always keep a note of the name of the person you speak to and the date you spoke to them.

In the meantime, it would be a good idea for the firstborn to get the letter of authority anyway, so your aunt’s estate can be settled.

Wishing you the best,

Answered on March 3, 2022, 3:55 p.m.

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