IRELAND - Paul Kenny, the Pensions Ombudsman, has won a court order forcing a construction company to provide his office with records of employment, and has also initiated criminal proceedings against the firm for obstructing investigations.

Galway Circuit Court has ordered the construction firm - 3D Restoration and Construction Limited - to produce the requested employment records to the Pensions Ombudsman within 21 days or it could face a significant fine. 

The construction industry has a mandatory pension scheme, the Construction Workers Pension Scheme (CWPS), but Kenny revealed there is a lot of "default" associated with the fund, including employers who fail to register employees or those who register employees but fail to make the pension deductions.

However, in "extreme" cases employers register the workers, deduct the contributions but then fail to place it in the scheme, which Kenny pointed out is "theft".

He revealed his office receives a lot of complaints about these issues, and in cases which involve deductions that are not paid on to the pension fund, the Ombudsman has to obtain the necessary information for the investigation, which can include employee payslips but in some cases access to employment records are required.

Kenny told IPE "most times" employers who receive a request for information will comply, but explained in this particular case the firm "decided to ignore us on the basis that we would go away. But we didn't".

He said: "This person has been completely non-cooperative to the extent that in court the solicitor defending them had to say they had been given no instructions. In this situation, it is clear that co-operation is the last thing on this person's mind."

This case is the first time the Pensions Ombudsman has used the enforcement proceedings, under Section 137 of the Pensions Act 1990 (as amended), to force a firm to provide information following a change to the Rules of Court last year, though Kenny suggested it would not be the last.

He pointed out the Ombudsman is there to ensure people receive their proper pension entitlements, and although disputes are often resolved through mediation he stressed he has "no hesitation in resorting to the courts".

Kenny said: "In certain cases, employers refuse to provide information which I have requested and in these circumstances, I have no hesitation in resorting to the courts to obtain what I need.

"I would hope that this judgement will serve as a warning to those who contemplate ignoring requests from my Office. They will lose in court and, as in this case, will have to pay all of my legal costs", he added.  

The firm now has 21 days to produce the employment records, or the circuit court is likely to impose a significant fine.

But at the same time, Kenny told IPE, the Ombudsman's office had also initiated criminal proceedings against the firm - on a charge of obstructing the investigation, to be heard later this month - which could carry a maximum fine of €5,000 and a possible jail sentence.

Kenny told IPE: "I believe it is necessary to use the sanctions under the Pensions Act to show people we are serious, otherwise they will think they can get away with it, and they can't."

In addition, he confirmed a "few more cases are in the pipeline", all of which are related to the construction industry, and pointed out while the rest of the pensions industry has been co-operative with "no need to use a stick", the construction industry appeared to be "less well-organised".

He said: "In such cases, my responsibility is to ensure that employees are treated fairly and that they do not rue the day when pension age arrives and they do not have their full entitlements.

"It is shameful that certain employers in this sector actively set out now to deprive people of a significant pension benefit years down the line and my Office will use the full rigour of the law to ensure that they do not succeed", he added. 

If you have any comments you would like to add to this or any other story, contact Nyree Stewart on + 44 (0)20 7261 4618 or email nyree.stewart@ipe.com

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