The director of a defunct business was ordered on Thursday to pay former employees almost $96,000 that had been deducted from their salaries as contributions to a pension plan, but which was never placed in any plan.
Defense attorney Keva Reid told Magistrate Angelyn Hernandez that the director, Theresa Chin, had other debts to deal with and could pay $250 per month.
The magistrate did not accept that offer. She pointed out that the outstanding pension contributions totaled $95,927.65. Thirteen employees were affected and two of them were owed over $24,000 each, based on deductions that started in February 2009.
In addition to the order to pay the pension contributions, the magistrate imposed fines adding up to $13,100. At the rate of $250 per month, it would take over 36 years to pay the total of $109,027.65.
In passing sentence, the magistrate said that the defendant’s company, TC Fahrenheit trading as 123 Travel, had deducted pension contributions from the travel agency employees’ pay. The understanding was that these funds were being contributed to a pension plan as required by law. Instead, the money was used to enrich the company, the magistrate said.
After a complaint was lodged, Ms. Chin met with officers of the Labour and Pensions Department and in September 2016 she agreed to pay the arrears. She did make two payments of $500 each and then stopped. Charges of failing to contribute to a pension plan were brought against her in September 2017.
She entered guilty pleas in early 2018. Ms. Reid asked the court to make it clear that Ms. Chin entered the pleas as director of a limited company, not in a personal capacity.
In mitigation, she pointed out that the money was used to keep the company going, not for Ms. Chin’s own benefit.
The magistrate said something should have been done sooner, or else the decision should have been taken to stop operating the business and stop taking money from employees.
Told of the offer to pay $250 per month, the magistrate replied, “No, we are going to have to do better than that.”
She pointed out that this was a criminal offense and the behavior, over a six-year period, was both dishonest and distasteful.
The magistrate said it was her opinion that a financial penalty was wholly insufficient. In many cases, she pointed out, it was the defendant’s inability to pay the pension contributions that brought them to court in the first place. She called for a review of the penalty section of the Pensions Law and provision of additional sentencing options.
In Ms. Chin’s case, the magistrate asked for a time line and a proposed payment plan. Crown counsel Greg Walcolm, who had prosecuted the matter, agreed to have it adjourned until Wednesday, July 11.
The magistrate said payments should be made to the Pensions Office and the money should be disbursed to the former employees, with those affected the earliest and most significantly receiving relief first. The fines were to be paid after the victims are paid, she indicated.