Business (sole trader) has undergone a monitoring visit from the CIF pension scheme.

[ssap16]

My brothers business (sole trader) has undergone a monitoring visit from the CIF pension scheme.

They have come up with a bill of €70,000 going back over 4 years. This will bankrupt my brother.

Whilst not denying the liability is there any way that the CIF will back down on their demands?

For the last 1.5 years before the inspection he has been correctly operating the scheme.

Whilst admitting that he done wrong it appears that the CIF hammer people who voluntarily go to them whilst not pursuing does that do not comply or register at all.

 

[Graham_07]

Re: CIF pension

One might think that it would not be in the CIF's interest, from a point of continuing future contributions from the employer, to arrive at a situation where the debtor goes out of business due to the amount owing. Would it not be possible for him to discuss payment terms with the monitoring team and see if some deferred payment or other arrangement could be arrived at to the satisfaction of both.

 

[RainyDay]

Re: CIF pension

My brothers business (sole trader) has undergone a monitoring visit from the CIF pension scheme. They have come up with a bill of €70,000 going back over 4 years. This will bankrupt my brother. Whilst not denying the liability is there any way that the CIF will back down on their demands? For the last 1.5 years before the inspection he has been correctly operating the scheme. Whilst admitting that he done wrong it appears that the CIF hammer people who voluntarily go to them whilst not pursuing does that do not comply or register at all.

Do you have an alternative suggestion as to how the pensions of the employees in question should be funded?

 

[ssap16]

Re: CIF pension

Do you have an alternative suggestion as to how the pensions of the employees in question should be funded?

Perhaps they should fund their own pension like we all do. I presume you live in the ideal world of the PAYE worker. Business is tough. Try it some day.

 

[ubiquitous]

Re: CIF pension

Do you have an alternative suggestion as to how the pensions of the employees in question should be funded?

By all accounts that I've heard from contacts within the building sector, the CIF scheme won't fund much of a pension for anyone within the scheme, as it is said to be pretty bad value when measured against other pension schemes on an "input v outcome" basis. Maybe these accounts are true, maybe not. Perhaps someone in the know might inform us?

 

[simplyjoe]

Rainy day seems to live in a nice zone. For builders these CIF contributions are the last straw. As well as paying €25+ an hour they then have to stump up €46 a week for a pension scheme that usually contributes little to an employee's retirement seems crazy. They also have to pay 10.4% PRSI on top of this. Why should a plasterer earning €1,500 a week be entitled to this treatment. People should look after themselves not constantly expect others to pick up the tab.

 

[RainyDay]

Oooh seems like I touched a nerve. How silly of me to expect employers to meet their contractual obligations to their employees! Joe's description of the pension contributions as the 'last straw' may have been some kind of Freudian slip. They are of course, last on the priority list for payments for no good reason other than the employer reckons they can get away with it. They know damn well they won't get away with not paying a supplier or not paying direct salaries, but given the bureaucracy and confusion associated with any pension scheme, they can get away with skimming off the pension contributions, reminiscent of that fine ol bastion of capitalism and ethics, Robert Maxwell.

To rip-off such payments from employees is despicable behavior, and this 'business is tough' justification should not be tolerated by anyone.

One might think that the CIF scheme had nothing to do with the CIF, but of course, the scheme was implemented by the building industry (in partnership with the trade unions) when it was realised that many construction workers were left solely dependent on the state pension, and widows were left with nothing. The precessor scheme was funded 1/3 by the employees and 2/3 by the employer, so the implications that the employees are funding their own pensions is of course completely wrong.

If builders don't like the CIF scheme, then they can change the scheme through the CIF. But to scam employees is dispicable.

 

[Purple]

While I agree with the facts of your post RainyDay, the tone is very much "tarring them all with the same brush". I am a capitalist but would not dream of scamming my employees. You should try a little less of the moral indignation 'till you have run a business and realised that X numbers of people rely on your ability to make the right decisions to pay their mortgages. Believe it or not most employers take that responsibility seriously.
People in desperate situations do things that they would never have considered in the good times.
In the mean time can you offer any constructive suggestions?

BTW, I am not in the building industry.

 

[ssap16]

I think Purple has summed it up pretty well. I suppose the only option is to go out of business/bankruptcy. The CIF is a body that represents some builders - not all. The scheme of pension contributions is a statutory obligation - no choice. Blocklayer on €900 a week costs the employer €1,040 a week directly as well as bank holidays and holidays say 8 weeks off - employees insurance, etc a further €1,000 oper annum. So total costs = €55,080 divided by 44 = €1,252 per week. So paying someone €900 costs €1,252 = 36% more. Trust me this is a huge burden. Business is not all huge profits and Mercs. Many, many businesses struggle. Many, many business owners spend huge hours at work trying to keep businesses afloat. Have a little understanding. Not all laws are fair. Having to pay €46 to SOMEONE ELSE'S private pension on top of having to pay (in the example above) €94 to their state pension is, IMO, grossly unfair.

 

[MOB]

this 'business is tough' justification should not be tolerated by anyone.

I agree. But, in the case of the construction industry, at least in recent years, it is not wholly the fault of the employers - employees share a large part of the blame.

A building industry employer who paid the full union rate plus full pension contribution to skilled workers over the past few years would have found himself with no employees: they would all have left to work for employers who were paying more 'in the hand'. In fact, employees constantly pressurised their employers to put more money in their hands, and wage levels ballooned.

Most employees in the construction industry have one measure only of pay - the amount they receive in the hand.

I don't believe that any compliant employer with an employee who came to him saying 'xyz limited will give me €50\week more than you are paying, pony up or I am leaving' could have induced the employee to stay put by pointing out that xyz limited were not paying pensions. This created an intolerable pressure, and there is no getting around the fact that employees were full and willing participants in creating this pressure.

 

[RainyDay]

I don't think there are going to be too many hearts bleeding for the builders, particularly amongst those customers who have been over-charged and under-delivered during the Celtic Tiger years. It is ironic to hear that builders are being squeezed as a result of under-the-counter payments, given of course that they practically invented this genre. The chickens are coming home to roost.

 

[MOB]

I think under the counter payments are not the big issue from the employer perspective. Most housebuilders\developers could gain no advantage from such payments. Many smaller builders (and construction workers on 'nixers') doing repairs and extensions certainly use cash and under-the-counter payments, but they are not the ones being targeted by CIF pension scheme. But certainly yes, the chickens are indeed coming home to roost and it is difficult to have sympathy for either the small number of construction industry employers who are now being stuck for pension payments or the large number of construction sector employees who were short sighted enough to ignore this issue in favour of larger weekly nett pay.

 

[Purple]

I think under the counter payments are not the big issue from the employer perspective. Most housebuilders\developers could gain no advantage from such payments. Many smaller builders (and construction workers on 'nixers') doing repairs and extensions certainly use cash and under-the-counter payments, but they are not the ones being targeted by CIF pension scheme. But certainly yes, the chickens are indeed coming home to roost and it is difficult to have sympathy for either the small number of construction industry employers who are now being stuck for pension payments or the large number of construction sector employees who were short sighted enough to ignore this issue in favour of larger weekly nett pay.

I agree, everyone went into this with their eyes open and the oh so very predictable left-wing/ trade union response that it's the bid bad employers exploiting the poor huddled masses just doesn't wash any more.
They were all happy to play fast and loose with the rules and now they are getting burned. As an employer in a totally non cash industry who has never given or received a cent under the counter I won't shed any tears but I won't cast the first stone either.

 

[RainyDay]

Re: Business (sole trader) has undergone a monitoring visit from the CIF pension sche

I agree, everyone went into this with their eyes open

So just to be clear, you reckon the specific employees who have been left short of their pension contributions by the OP's brother went into that phase of employement with the eyes open, in the full knowledge that their employer would not pay their pension contributions?

 

[contemporary]

Re: Business (sole trader) has undergone a monitoring visit from the CIF pension sche

If he had a ltd company he could do a phoenix and liquidate the business and set up again, he wouldnt be the first, however he is a sole trader so doesnt that option, i have read on many boards advising people not to set up as ltd companies but as sole traders because its cheaper, here is a good example of where limited liability would have helped the business owner, mind you i dont condone his actions in not paying the pension plan, but i do think its a bit rich for any business to have to pay a mandatory pension on top of prsi, but i suspose he knew this when he got into the business

 

[Purple]

Re: Business (sole trader) has undergone a monitoring visit from the CIF pension sche

So just to be clear, you reckon the specific employees who have been left short of their pension contributions by the OP's brother went into that phase of employement with the eyes open, in the full knowledge that their employer would not pay their pension contributions?

I was commenting on MOB's post which was a comment about the building industry in general. Have you no idea of how to read a post in context of are doing a Pat Rabbitte and being deliberately disingenuous?
If you were a first time poster I'd dismiss your comment as trolling.

 

[RainyDay]

Re: Business (sole trader) has undergone a monitoring visit from the CIF pension sche

I was commenting on MOB's post which was a comment about the building industry in general. Have you no idea of how to read a post in context of are doing a Pat Rabbitte and being deliberately disingenuous?
If you were a first time poster I'd dismiss your comment as trolling.

If you come out with broad generalisations along the lines of 'everyone went into this with their eyes open', don't be in the least bit surprised that you'll get challenged for clarification here on AAM. In this case of course, the ripped-off employees didn't go into this with their eyes open. There is a fairly good chance that they barely spoke English.

But they still didn't get their pension payments - and the OP is completely silent on the issue of how this might happen.

 

[Purple]

Re: Business (sole trader) has undergone a monitoring visit from the CIF pension sche

don't be in the least bit surprised that you'll get challenged for clarification here on AAM.

Thanks for that, as a newcomer I'm glad for the heads-up.

MOB made a general point about the building industry. I was commenting on his post, which (in case you missed it) was a general comment about the building industry. Therefore is could not be specific (as his post was a general comment). Do you get what I'm saying yet?

I have already posted that I agreed with the substantive points you made with regard to the specifics of this case in your second post. The fact that the world is not neatly divided into "Workers" and "Bosses" messes up your simplistic 1920's style socialist views is no reason to infer that I an Ok with tax evasion or stealing from your employees pension fund. So if you want to know if you struck a nerve, yes; I resent the hell out of that.
I’ve been posting here for years in threads that you have also posted in and I have always had very strong views about employers that screw over the people who work for them and unless you have a very short memory you know that.

 

[RainyDay]

Re: Business (sole trader) has undergone a monitoring visit from the CIF pension sche

MOB made a general point about the building industry. I was commenting on his post, which (in case you missed it) was a general comment about the building industry. Therefore is could not be specific (as his post was a general comment). Do you get what I'm saying yet?

I think I'm getting it. When you said 'everyone went into this with their eyes open', you didn't really mean everyone - is that it? You meant 'everyone except the employees of ssap16's brother's company' or something like that - have I got it now?

The fact that the world is not neatly divided into "Workers" and "Bosses" messes up your simplistic 1920's style socialist views is no reason to infer that I an Ok with tax evasion or stealing from your employees pension fund. So if you want to know if you struck a nerve, yes; I resent the hell out of that.

This is of course the standard IBEC/PD tactic of attempting to divert attention from the core issue by creating a war of name-calling and labelling. If expecting employees to get the pension payments to which they are legally entitled is considered to be 'simplistic 1920's style socialist views', then mea culpa - I'm guilty, and proud to be.

 

[Purple]

Re: Business (sole trader) has undergone a monitoring visit from the CIF pension sche

I think I'm getting it. When you said 'everyone went into this with their eyes open', you didn't really mean everyone - is that it? You meant 'everyone except the employees of ssap16's brother's company' or something like that - have I got it now
This is of course the standard IBEC/PD tactic of attempting to divert attention from the core issue by creating a war of name-calling and labelling. If expecting employees to get the pension payments to which they are legally entitled is considered to be 'simplistic 1920's style socialist views', then mea culpa - I'm guilty, and proud to be.

Right, I’ll explain it again for the hard of understanding.
I have already stated my views on what ssap 16’s brother has done; it was wrong and he deserved whatever he gets. My comments were made on the more general point made by MOB that when employees are complicit in, or the instigators of, underhand practices it is neither reasonable nor logical to treat them as victims of their employer. These are two separate issues but as with many threads here on AAM a specific post can lead into a more general discussion.
I am neither a member of, nor have I any association with, IBEC or the PD's. I have no idea why you seek to introduce yet another red herring into the discussion.
I do not think that expecting employees to get the pension payments to which they are legally entitled is considered to be 'simplistic 1920's style socialist views', I do consider trying to pigeon-hole everyone into a “worker” or “boss” identity is totally outdated and in this day and age just plain stupid and therefore a 'simplistic 1920's style socialist views'.
It’s time to recognise that in a country with a will regulated labour market, an educated workforce and full employment it’s possible that employees can, in some cases, call the shots. That’s the point that MOB made and the point that I commented on. Read the thread, read what has been said and read it in context. I do not support any employer abusing their position and screwing over their employees to line their own pockets and neither do most employers. That is not to say that your point that many of the employees in the building industry are non-nationals and need extra protection is not correct but it does not negate the more general point about complicity by many within the industry.

There are not two moral classes in this country, or any country, where the pure of heart “workin’ man” get abused by the big bad evil fat-cat bosses. Sorry if that doesn’t sit well with your deeply flawed political philosophy up there on the moral high ground but as with most things reality is more complicated than that.