Most employers are aware of the changes to pensions and the upcoming auto-enrolment regulations but how many people are putting off doing anything about it? In fact, how many people are just thinking that they’ll worry about it when the time comes?
Perhaps we can all learn a lesson from the large employers who are already required to meet their auto-enrolment obligations, especially those who are falling foul of the Pensions Regulator.
If these larger employers were wondering just what “teeth” the Pensions Regulator has to deal with non-compliance, they’re about to find out. The first compliance notice has recently been issued to an un-named employer failing to meet their auto-enrolment obligations. A compliance notice requires the employer to take or refrain from taking steps to remedy the breach of regulations. A further 38 warning letters have been issued for minor breaches which notify the employer of potential breaches and give them a reasonable timeframe in which to put the issue right or to prevent it from re-occurring.
Smaller employers need to learn these lessons from their larger counterparts and they also need to take the hint from the Pension Regulator’s approach. They say that:
- They are about to issue their first fine.
- They will be aware of any company missing their staging date within four weeks.
- Their approach will then be to see what progress has been made and the employer will be given 4 weeks to get it done or receive a £400 fine. In most cases this is having the desired effect and employers are correcting the situation.
- For employers that have deliberately ignored the legislation the fines will be bypassed and they will go straight for the prison option.
- There is no excuse for an employer missing its staging date by not being prepared or being let down by a provider as NEST is available and has the capacity to deal with all employers.
The last point is particularly important – lack of preparation or lack of knowledge will not be acceptable excuses for missing a staging date. It doesn’t have to be a problem for you and your business but you do have to be prepared!
Keeping HR Simple have chosen Orchid Financial Services as their Independent Financial Adviser to help clients prepare for auto-enrolment. Get in touch today to find out how we and Orchid Financial can help you.