Administrator investigating ‘irregularities' in Francis Catering pensions

Administrator investigating ‘irregularities' in Francis Catering pensions

FRP Advisory, the administrator that handled the insolvency of Francis Catering Equipment last autumn, is investigating irregularities relating to the former company's employee pension scheme.

Francis Catering, along with Design Catering Equipment, were sold out of administration last September to manufacturing group Unitech Industries for £88,000.

According to the administrator's report, 174 unsecured creditors were owed £1.8m by the company, which had been trading for more than 40 years. The report estimated there would be sufficient funds to make a distribution to unsecured creditors.

However it has since emerged that there were problems with the employee pension scheme and that FRP Advisory is seeking to establish the value of an apparent pension deficit. Ex-employees of Francis Catering could be in a position to submit claims for outstanding amounts.

Steve Stokes, partner at FRP Advisory and joint liquidator of Francis Catering Equipment and its associated company, Specialised Stainless Products, said: "We are aware of an issue relating to employee pension contributions prior to the insolvencies of Francis Catering Equipment and Specialised Stainless Products, and have written to those employees affected seeking confirmation of pension deductions from their salaries.

"Once we have confirmed the value of deductions, this information will be passed to the Redundancy Payments Service. As part of the insolvency process, we will also consider any residual claims of the former employees."

It is understood that ahead of workplace pension automatic enrolments in 2015, Francis Catering launched what employees believed was a pension scheme.

But there was no record of payments that staff made into the programme when they were enrolled into Unitech's Scottish Widows pension scheme, following their transfer over to the new company.

Unitech is reportedly seeking to mitigate the situation. Options being considered include setting aside future profits to reimburse the affected employees that now work for its business.

Francis Catering and Design Catering Equipment sold out of administration >>

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