Since 2012, more than 5.4 million workers have been automatically enrolled into a workplace pension by almost 61,000 employers. By the time the process is complete in 2018, it is estimated that around 9 million workers will either be newly saving or saving more into a workplace pension thanks to the policy.
The latest round of advertising from The Pensions Regulator (TPR) focusses on ‘micro’ employers, such as families who hire a nanny or a Ltd company with one employee other than a Director. The same rules apply to these employees as to those from bigger businesses. If you don’t enrol them into a suitable pension scheme – you will be liable for a fine from TPR. So far 26,000 notices have been handed out for late compliance but only 5% of these have escalated to tribunal stage. Reasons given for non-compliance include a member of staff being ill, relying on someone else to do the work, not receiving any information and companies making a mistake. For clarity, none of these are valid reasons and will not count in your favour at a tribunal!
The only way to avoid a fine is to ensure you are ready to enrol your employees in time for your staging date. We advise a minimum of 6 months preparatory time to look into your options and discuss with your employees the process and your plans. Below is a reminder on the enrolment criteria:
- Be aged between 22 and state pension age
- Earn at least £10,000 a year
- Work in the UK
For more information on Auto Enrolment or to have one of our advisers present to you and your employees the process, please contact us on info@iepfinancial.co.uk or call 01273 208813.
Our Auto Enrolment key fact guide can be found here.