September 24, 2020

Public name and shame is the name of the game in new Pensions Law

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As we reported in iNews Cayman yesterday (31) the proposed new Department of Labour (DOLP) and Pensions states that any employer who does not respond to orders to pay will not have their trade and business licence renewed nor will he/she be able to obtain work permits. It has also been revealed that the DOLP will be able to publicly name and shame all those who receive the fixed penalties.

These penalties are handed out by the DOLP and the only redress is for the employer to take the matter to court if he does not agree. The employee on the other hand only has to appeal to this same board if he has a dispute with his employer.

Whilst we accept there are over 600 cases of delinquent pensions where employers have taken the pension contributions from their workers’ salaries and then not paying that or the 5% employer share into the fund, the proposed law seems to be Draconian in favour of the employee.

But it is not all one way sailing. No employee can opt out of a pension scheme and use the equivalent contribution to invest as he/she feels fit. The new bill will not allow anyone to opt out under any circumstances.

There will also be protection for employees who “tell tale” on their employers who are breaking the law by asking them to collude and who do not pay into the fund.

At least it has been acknowledged by officials that it is often the case the employee is a willing accomplice to the flouting of the law. However, this new law puts a loaded gun into the hand of the employee as he can threaten to report this to the DOLP saying he had no knowledge this was going on. The employer has to take court action.

We can also have a situation where the DOLP makes a mistake (yes that is a possibility – government officials do make mistakes, don’t they?) and “names and shames” by publicising the employer who they have mistakenly fined.

Can the falsely accused and fined employer sue the actual individual who has the power to be judge, jury and name and shame?

I’m afraid it makes me nervous at all this extra one sided red tape and powers being put in place. If the officials at the original department of labour and pensions had been doing their jobs diligently in the first place, even under the old laws, 600 delinquent pension cases would not have happened.

To the many employees who are reading this who do not agree with me I hope they remember there is no cop out of the pensions scheme – it is mandatory. It is not mandatory, however, for the pension plan to make money or at the very least allow you to receive equally the same amount of money that has been paid in. The companies that run these pension plans use your money to invest.

Does that seem at all risky to you?

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