Auto-enrol fines spike as firms miss deadlines

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The Pensions Regulator issued 576 escalating penalty notices to employers that failed to comply with auto-enrolment rules between July and September, more than 15 times the amount in the previous three months.

Between April and June, TPR handed out 38 escalating penalty notices. Employers that receive such a notice will receive a penalty of between £50 and £10,000 per day, depending on their size.

The number of fixed penalty notices given out, where employers are fined £400, increased more than four times on the previous quarter’s amount.

Between July and September 3,728 fixed penalty notices were issued compared to 861 between April and June.

TPR says the increase in penalties comes as there was a 50 per cent increase in employers reaching their deadline to comply with auto-enrolment rules.

The latest compliance and enforcement bulletin from the regulator says many reasons employers give for non-compliance, for example illness or being short-staffed, are not “reasonable”.

TPR auto-enrolment executive director Charles Counsell says: “We recognise 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 adds: “So 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.”