Pensions office pursues Henderson 

Cyril Theriault,
Superintendent of Pensions

Thursday,  October 6, 2005

The owner of Office Pavilion, Scott Henderson, did not show up to the first court hearing on 4 October where he faced 78 charges for failing to pay pensions for employees. Mr Henderson’s attorney, Clyde Allen, was called into the court and the case was combined with another of Mr Henderson’s, Cayman Flooring and Kitchen Specialists Ltd., which has 86 charges against it related to non-payment of pensions.

According to the National Pensions Office, pensions have not been paid for more than three years in both companies.

Furthermore, pensions were allegedly deducted from employees’ pay cheques, but were not paid into plans. Since information was not supplied to the Pensions Office on employees, exact numbers of the people affected were not available. However, it is estimated to be 35 employees for both companies totaling CI$300,000 for back payments and accumulated interest.

“A number of employees have been affected but because of the lack of information we don’t know who was employed when,” said Cyril Theriault, Superintendent of Pensions. “We only find out about a problem until an individual has complained. We do know there are dozens of employees affected and I imagine a lot of these employees are no longer on the Island.”

He added that contributions should go into employees’ accounts.

“We would prefer not to have to go to court and take up the court’s time or have employers incur additional legal expenses. Should this court case drag on, we have taken other legal actions to ensure employees receives their money,” said Mr Theriault.

Although Cayman Net News could not find evidence, it has been alleged that restrictions have been put on numerous properties owned by Mr Henderson so that if they are sold, the proceeds will first go to pay off creditors. It has also been alleged that Mr Henderson has been selling off numerous properties in recent months.

Subsequent to reports about the pension charges, both of Mr Henderson’s companies have closed and phones are disconnected. It is not known, if this is a temporary closure or permanent.

The next court hearing is scheduled for 13 October. Mr Theriault explained that both these cases are the first businesses to be prosecuted for not paying pensions since the National Pensions Law came into effect in 1998.

Part of the reason is the Pensions Office has not had adequate staff and systems in place to follow up on delinquent employers.

“We are looking at this case to set a precedent in how future cases against employers will be prosecuted,” said Mr Theriault.

He added that in the six months the Pensions Inspector, Pierre Lautischer has been on board, the office has been able to closely follow up on outstanding cases.

“Our Pensions Inspector has been instrumental in ensuring the cases proceed to the next level as in this case now before the courts,” said Mr Theriault.

According to the National Pensions Office, Mr Henderson agreed to make pension payments for both companies going forward as well as catching up on back pensions, but then subsequently failed to do so.

In a court hearing on 15 September, Mr Allen said there was a tremendous amount of information to go through for Cayman Flooring and Kitchen Specialist, but Hurricane Ivan wiped out most of those records so they needed more time. Moreover, the defense wanted to submit a proposal to the Crown, though none has as yet been forthcoming.

When contacted by Cayman Net News, Mr Henderson said he had no comment.

There are close to 600 employers being investigated for late pension payments. Of that number, it is expected that six employers will be prosecuted through 30 June 2006.

However, Mr Theriault said he would rather spend time reviewing the pensions law to make proposals for amending it.

One recommendation is to shorten the time period that plan administrators must report a delinquent employer, which effectively allows companies to be two months overdue before the Pensions Office becomes involved.

“Employer are already two months late by the time our office knows about it,” he said.

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