The number of employers fined for failing to comply with the Automatic Enrolment rules has soared over the past few months.
New figures reveal that the Pensions Regulator imposed 166 fixed penalty fines, each for £400, in the last quarter of 2014. The number of compliance notices, which act as an early warning to employers that they need to remedy their behaviour, also rose significantly.
Despite tens of thousands of employers successfully complying with the new rules, the increase in the number of fines may be the start of a worrying trend of non-compliance, with only three such fines ever previously recorded.
Indeed, as the number of smaller employers which must comply with the regulations increases in 2015 and 2016, the regulator is clearly concerned that the number of firms missing their staging date, or simply failing to comply, will rise.
The Pensions Regulator’s Director of Automatic Enrolment, Charles Counsell, said: “My message to all employers is that failing to declare within five months of your staging date means you risk being fined, which is why we recommend you start your Automatic Enrolment planning and preparation 12 months before staging.”
“It appears some medium employers waited for a prompt from the regulator before completing their Automatic Enrolment duties. Employers must complete all their duties including making their declaration of compliance to The Pensions Regulator.”
“With the mass market roll out of Automatic Enrolment to large numbers of small businesses in the coming months, we expect to see an increase in how often we need to use our powers.
“The vast majority of employers complete their duties on or ahead of time, but we are seeing a small minority that require the additional nudge of a notice from The Pensions Regulator.”
Timing regrets
Research done by the Pensions Regulator, shows that the biggest mistake made by firms who have already complied with their staging date, is that they didn’t allow sufficient time.
The regulator recommends that employers should start to plan at least 12 months in advance of their staging date; although our experience tells us that this warning all too often falls on deaf ears.
The Pensions Regulator has published 10 tips to help your business comply with the Automatic Enrolment rules. They are:
1. Make sure you’re prepared – you’ll need all of the information on this checklist.
2. This is your responsibility as an employer – the pension scheme will not do it for you.
3. Start ahead of time with information you already know – your progress will be saved.
4. To access a partially completed declaration, you’ll need to know the EPSR, PSR or unique NEST ID entered.
5. Complete and submit your declaration as soon as you’ve automatically enrolled your eligible jobholders.
6. If you represent several employers, log in under ‘acting on behalf of an employer’.
7. If you have more than one employer within your corporate group, you must treat each employer separately.
8. Only tell us about pension schemes you’ve used for automatic enrolment.
9. Make sure you know about and tell us about every PAYE scheme the employer uses.
10. Watch our demo video for a walk-through guide: http://livegroup.co.uk/registration/
We’re here to help
If you are approaching your staging date, even it is very close, we’re here to help.
We have helped many firms comply with the Automatic Enrolment rules and avoid potentially large fines. Get in touch with our expert, Sarah McCarthy today on 0115 933 8433 or email sarah.mccarthy@investmentsense.co.uk
