A number of Cayman Islands charitable organizations were caught by surprise this week following a government request that they register with the Department of Labour and Pensions.
“This is completely news to me, “ said Betty Ann Duty, a director and past chair of the Cayman Islands Cancer Society. “When I read it, I thought, what is this all about?”
“What a way to start the day, no, I have not seen this before,” said Cayman HospiceCare’s operations director, Jennifer Grant-McCarthy.
Government Director of Labour and Pensions Mario Ebanks said the notice was sent out Tuesday urging charitable organizations to register with his agency, if they maintained any employees. Any organization that does not have employees would not have to register with the Labour and Pensions Department.
“Currently, we don’t have [any charitable organizations] in our registry,” Mr. Ebanks said.
The Labour Law [2011 Revision] exempts charitable organizations from its provisions, as long as they register with the Labour and Pensions Department and the director accepts them as being charities, Mr. Ebanks said.
The process is separate from a step many charities have taken in registering as a nonprofit or charitable entity under the Cayman Islands Companies Law.
Mr. Ebanks said it is also separate from earlier attempts to enact legislation to more strictly govern such organizations, known as the Charities Bill. That legislation was pulled by Attorney General Samuel Bulgin after dozens of charities said the bill’s financial reporting requirements and the additional costs those bring would force them to shut down. A new draft of the bill has never been made public or placed before the Legislative Assembly.
“It’s a whole separate procedure to be registered under the Labour Law,” Mr. Ebanks said.
This registration of charities under the law is not a new concept, Mr. Ebanks said. However, he noted that registrations may either have lapsed or simply never occurred in the period following 2004’s Hurricane Ivan.
“I think what happened is that, prior to Hurricane Ivan, they had started a process [to register the companies] … the Labour Department was located in the old Tower building, which was destroyed by Ivan, and the hard copy files and electronic files were lost,” Mr. Ebanks said.
“The implication is simply this, if a ‘section 80’ organization [under the Companies Law] does not register and a complaint comes in as from an employee of that organization … then that complaint is handled like any other complaint [under the Labour Law]. If they are registered … that complaint would not be heard because, essentially, it is outside our jurisdiction.”
Mrs. Duty questioned whether the Mr. Ebanks was advocating that nonprofit charitable operations should not provide pensions and healthcare coverage for their workers.
“I’d like to know why they’re asking for this registration really,” she said.
The subject of greater regulation of charities has been a matter of discussion in the Cayman Islands for years as the local government has attempted to meet international law enforcement requirements for protection against the potential to use nonprofit groups as a front for money laundering or terrorism financing.
Some local charities themselves have other, more prosaic concerns about regulation of goodwill efforts in the Cayman Islands.
Mrs. Grant-McCarthy said Cayman HospiceCare maintains a certificate of incorporation and has annual independent audits of its finances completed. However, that’s not the case for all charities, she said.
“Unless they’re dealing with a reputable charity who does provide an audit, I don’t think people can know,” she said. “I don’t know how they would know unless they are able to see the funds on an annual basis. I guess people operate on faith.”
Operations manager of the Cancer Society Jennifer Weber said what is defined as a charity in the Cayman Islands can often mean different things to different people.
“Anyone who wants to do good, it doesn’t mean they automatically have a charity or a nonprofit,” she said.
The earlier draft of the Charities Bill sought to address some of these concerns. However, there were a number of specific proposals that local charities thought should be changed.
Mr. Bulgin said in 2011 that he hoped a “sensible compromise” could still be achieved on the bill.
“It is clear that more needs to be done by government to clarify the object of the proposed law to further regulate the relevant charities as mandated by Cayman’s international obligations,” he said.
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Mr Ebanks could better justify his salary by bringing to Justice the many companies who are non-compliant with their Pension programmes. Those situations do, or will, affect the lives of many people who have possibly lost thousands of dollars. He needs to rethink his priorities.