Brewery, Chairman Fined for Withholding Information from TPR

A UK magistrates’ court has fined Samuel Smith Brewery and its chairman, Humphrey Smith, nearly £28,000 ($36,747) for failing to hand over information to UK pensions watchdog The Pensions Regulator (TPR).

Smith was fined £8,000, while the brewery was levied a fine of £18,750. They were also ordered to pay £1,240 in costs and victim surcharges. It is the sixth criminal conviction attained by TPR against individuals or organizations for failing to comply with section 72 notices.

“Smith and the brewery could have avoided this fine and a criminal conviction by simply complying with our notice requiring the information to be provided,” Nicola Parish, TPR’s executive director of frontline regulation, said in a release. “People who ignore our notices asking them to provide information should expect us to launch a criminal prosecution.”

Under section 72 of the Pensions Act 2004, TPR has the power to issue a notice requiring companies or individuals to provide information and documents relevant to its statutory functions. Failure to provide the information without a reasonable excuse is a criminal offense that can result in an unlimited fine.

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TPR said it requested information about Samuel Smith Old Brewery’s financial position following the submission of a 2015 valuation of some of the company’s final salary pension plans. The information was necessary to allow TPR to understand whether the pension plans were being adequately supported.

However, according to TPR, the information was not given by the deadline set in the regulator’s statutory notice, but was provided three months after the deadline expired, and only after criminal proceedings had been initiated.

Both Smith and the brewery pleaded guilty at Brighton Magistrates’ Court to neglecting or refusing to provide information and documents without a reasonable excuse. Smith was charged on the basis that he consented to or connived in the offense by the company, or caused it by his neglect.

District Judge Teresa Szagun said there was a need to stop individuals from taking an obstructive approach to requests by TPR for information, and during the sentencing referred to the “very terse tone” of the company’s refusal to provide information. She also said it was important that the public had confidence in a “robust process to investigate and protect” pension savers.

Tags: Humphrey Smith, Pension, Samuel Smith Brewery, The Pensions Regulator

The California Supreme Court has overturned an appeals court ruling that had upheld pension cuts enacted by San Diego in 2012. The court said the city was not legally allowed to put the pension cuts, also known as Proposition B, up for a public vote without first meeting with unions.

The decision could require the city to spend millions of dollars creating retroactive pensions for more than 3,000 workers hired since the cuts took effect.

In April of 2017, the Court of Appeal, Fourth District of California, overturned a ruling by the state Public Employment Relations Board (PERB) that found that San Diego violated the Meyers-Milias-Brown Act (MMBA) when floating Proposition B, which was supported by then-mayor, Jerry Sanders. The MMBA requires government employers to meet and confer in good faith with labor unions and representatives of recognized unions regarding wages, hours, and other terms and conditions of employment.

The appeals court ruled that the meet-and-confer obligations under the MMBA have no application when a proposed charter amendment is placed on the ballot by citizens, but instead apply only to proposed charter amendments placed on the ballot by the governing body of a charter city. The appeals court sided with San Diego, which argued that the pension reform proposal was sponsored by local residents, not the city.

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However, the state’s Supreme Court said Sanders used the powers and resources of his office to play a major role in promoting the cuts.

“When a local official with responsibility over labor relations uses the powers and resources of his office to play a major role in the promotion of a ballot initiative affecting terms and conditions of employment, the duty to meet and confer arises,” wrote Justice Carol Corrigan for the Court. “Sanders had a duty to meet and confer with the unions. Allowing public officials to purposefully evade the meet-and-confer requirements of the MMBA by officially sponsoring a citizens’ initiative would seriously undermine the policies served by the statute.”

Those policies include “fostering full communication between public employers and employees, as well as improving personnel management and employer-employee relations,” she wrote.

The state Supreme Court said it was up to the Court of Appeal to “address the appropriate judicial remedy.”

Former San Diego City Councilmember Carl DeMaio, who authored the pension reform enacted in 2012, vowed to fight to keep the cuts intact.

“We are concerned that the Supreme Court ruling opens the door for the lower court to consider a yet-undefined ‘remedy,’” said DeMaio in a statement, adding that the remedy could range from a simple monetary fine to overturning part or all of Proposition B.

“If the Appeals Court in any way changes or reverses the voter-approved pension reforms in Prop B,” said DeMaio, “we intend to appeal that violation of the people’s vote back to the Supreme Court.”

Tags: California, Jerry Sanders, Pension, US Supreme Court