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04 Apr 08: Pensions Ombudsman Slams Bad Employers

Pensions Ombudsman Slams Bad Employers

 The Pensions Ombudsman, Mr Paul Kenny, yesterday welcomed the news that the Pensions Board had secured a High Court Order against a construction firm which had failed to pay contributions due to a pension scheme for its workers.

“I am fed up of hearing of bad employers who fail to honour their obligations to the people who work for them”, he said. His office receives on average one complaint every day from a construction worker or a dependant of a worker who has died, where contributions have not been passed on to the pension scheme. “I was sorry to see that it had to come to a High Court action in this case, but I’m not particularly surprised”, he added. “Non-compliance in this industry is all too common.”

Some employers fail altogether to register with the Construction Workers’ Pension Scheme. Membership of this scheme – or of a similar scheme giving certain prescribed benefits – is mandatory under the Registered Employment Agreement for the construction industry. Others subscribe to the scheme but do not declare all of their employees. Worse still, others register members, deduct contributions from them, but fail (as in the recent case) to remit the contributions to the scheme. “There is only one word for that”, said Mr. Kenny. “Theft.”

“Failure to pay contributions exposes employees and their dependants to several risks. Apart from the fact that they will have reduced pensions (or none at all) when they retire, if contributions are not kept up, an employee may lose entitlement to sick pay under an associated scheme. If an employee dies, his dependants may lose the mortality benefit under the scheme – currently €63,500, plus €3,150 per dependent child,” he said.

Since 2003, the Pensions Ombudsman’s office, in response to complaints from individual workers, has succeeded in recovering about half-a-million Euro in unpaid contributions, and has ordered employers to pay more than €400,000 in mortality benefits. Contributions and death benefits amounting to more than €800,000 are currently under investigation.

“Unfortunately, it’s sometimes too late for us to help. In a number of cases, companies have already been liquidated by the time the complaint comes to us. We have failed to collect about €15,000 in outstanding contributions and almost €200,000 in mortality benefits”, he said.

For further information, contact Mr. Paul Kenny, Pensions Ombudsman at 01 6471650 or see www.pensionsombudsman.ie

 

3 rd April 2008

ENDS