Auto enrolment penalties see sharp increase
Stark new figures from The Pensions Regulator have revealed a sharp increase in the number of fines dished out to SMEs that fail to address their auto-enrolment obligations. The number of fixed penalty notices given out between July and September reached 3,728 fixed, compared to 861 between April and June. Under TPR rules employers are fined £400 for a breach, increased more than four times on the previous quarter’s amount.
TPR auto-enrolment executive director Charles Counsell said he recognised that employers have unique circumstances and challenges, “But the law is still the law. Employers who are struggling should contact us, we are here to help – do not wait for a fine.
“The vast majority of employers are successfully meeting their auto-enrolment duties and are doing the right thing for their staff. A small minority do leave plans too late but in most cases the nudge of a compliance notice is enough to get them back on track and avoid a fine.”
Pensions minister Richard Harrington added that do far, more than 250,000 employers are helping more than 6.7 million people save into a workplace pension. “The duty is being extended to all UK employers and they must ensure they enrol their staff into a scheme by the deadline for their firm, it’s the law.”
However, some industry observers expressed their concern over the numbers. Catherine Pinkney, co-founder of the payroll and workplace pension platform, Paycircle, said,
The rise in the number of fixed and escalating penalty notices handed out during the latest quarter is frankly staggering. An increase in the number of fines was always on the cards as the smallest businesses started to stage but these numbers are a real cause for concern. Between now and 2018 over a million small businesses are set to stage and, judging by this data, the number of fines is set to skyrocket. This latest data from the regulator is proof positive that too many small businesses are still in the dark about their workplace pension duties. For a multitude of reasons, not least considerable confusion around whose responsibility the workplace pension is — payroll provider, accountant, bookkeeper, adviser or employers themselves — many firms are burying their heads in the sand. Many of the smallest businesses still don’t know who to turn to for help.
Petaurum Solutions’ Comment
Complying with Auto Enrolment obligations can be a daunting prospect for many small and micro sized business. Choosing a cost effective, long-term implementation solution is critical for these businesses to ensure they do not become swamped with the processing requirements and responsibilities that potentially Auto Enrolment can bring. Therefore, for businesses considering their solution, focus should not only be on the pension scheme, but also on how it will be administered, methods to communicate, impacts on systems and data collection processes along with any HR and Legal changes may you need to make.
Petaurum have developed a complete SME specific, competitively priced end-to-end solution that will take care of the above, leaving you free to manage your business safe in the knowledge that your Auto Enrolment obligations are in professional hands. Want to know more then feel free to download our info pack here, or contact us to secure your PAE future.
This information is intended as a general overview and discussion of the subjects dealt with. The information provided here was accurate as of the day it was posted; however, the law may have changed since that date. This information is not intended to be, and should not be used as, a substitute for taking legal, HR or benefits advice in any specific situation. Petaurum Solutions is not responsible for any actions taken or not taken on the basis of this information. Please refer to the full terms and conditions on our website.