Pension cases stagger through courts

 Nearly a year since the Cayman Islands complaints commissioner declared nonpayment of worker pensions “a national crisis,” instances of pension violations being resolved through the court system appear to be few and far between.

According to records released this week by Acting Pensions Superintendent Mario Ebanks, some 15 cases where pension violations had been alleged were currently before the courts, while only four had been brought to a conclusion.

One of the “concluded” cases involved Cayman Net Ltd., the operator of the former Cayman Net News newspaper, where no employees received restitution for money owed. “At [a court] hearing on April 22, 2014, all charges [were] dismissed as it was accepted that no proceedings could occur as [owner Desmond] Seales was dead and was the sole director,” a statement on the National Pensions Office website read. “Documentation was produced to show business closed. Ex-employees would have to take civil action to recover their funds.” 

In three other cases resolved before the courts, payments of pension arrears were made by Creative Expressions Beauty and Barber and Cayman Fidelity Real Estate Services Ltd. In the third case, involving A&C Construction, the owner was fined $350. 

When Complaints Commissioner Nicola Williams issued a follow-up report on the matter in October 2013, a total of 1,144 businesses were listed as being in some stage of delinquency regarding private sector pension accounts.

Earlier this year, Mr. Ebanks noted that of 600 to 700 cases involving nonpayment of pensions, some 159 had yet to be resolved.

However, he said at the time that shoddy record-keeping and lack of adequate enforcement staff were holding the National Pensions Office back from operating at full efficiency.

For instance, of the 600 to 700 case files reviewed, Mr. Ebanks said only 378 were “valid,” meaning there were hundreds of duplicate or redundant files contained within the pensions office records. Among those files were six investigations that had become “statute barred,” in other words, at least five years had passed from the initial reporting of the nonpayment offense and, therefore, the case could not be prosecuted. A handful of the cases reviewed by the National Pensions Office dated back as far as 1998.

Conflict

In April, Mr. Ebanks went public regarding staffing concerns at the pensions office, including the fact that he was essentially being required to handle two jobs: that of acting pensions superintendent and his regular post as director of labor and pensions.

Mr. Ebanks has been acting pensions superintendent, in addition to his department director duties, since December 2012, when the pensions superintendent, Amy Wolliston, left that role. According to officials in the Ministry of Education, Employment and Gender Affairs, Ms. Wolliston has been reassigned to that ministry “working on special projects” that deal with pensions-related matters. The ministry has oversight responsibility for pensions matters.

The special projects include the redrafting the National Pensions Law that governs private sector pensions. The new law is expected to be presented to the Legislative Assembly sometime in 2016.

An earlier draft of the pensions law gave the National Pensions Office the ability to issue administrative fines for noncompliance, rather than having cases go through the laborious process of heading to court. However, Mr. Ebanks said that law was never enacted.

Resolution

For now, Mr. Ebanks said the office must work within the rules of the current system.

“The penalties available under the National Pensions Law are specified in the law, and the judge has the ultimate say on the punishment dispensed,” he said.
As far as delays in taking the cases through the courts, Mr. Ebanks said there are a “myriad” of reasons.

“[These include] collecting evidence, preparing proper files to submit to the office of the director of public prosecutions, time and resources available at the director of public prosecutions to review the files and to make a ruling on the suitability for prosecution, delays in the courts, unavailability of the courts and sparring between the prosecuting and defense attorneys,” Mr. Ebanks said.

Ms. Williams has expressed her disappointment that the government has said it will not deal with a full revision to the National Pensions Law until 2016, although some amendments were forecast to be made later this year.

“Working men and women … every month have funds deducted from their paychecks, thinking that these monies are being contributed to a pension plan which will help provide for themselves or their families in retirement,” Ms. Williams said, “only to discover that it was used in some other way, or in some cases stolen from them, by dishonest employers.”

According to records released this week by Acting Pensions Superintendent Mario Ebanks, some 15 cases where pension violations had been alleged were currently before the courts, while only four had been brought to a conclusion.