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Fifth of firms missing auto-enrol staging dates

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Over one in five (21 per cent) small employers are missing their automatic enrolment staging date, risking fines from the regulator.

Statistics from provider Now: Pensions show the incidence of firms complying with auto-enrolment rules either just before or after the deadline is increasing.

In Q2 2016 19 per cent of firms complied within a month of their staging date, in addition to the 21 per cent who missed it entirely.

Firms that do not comply receive a 28 day warning notice. If the warning notice is ignored, a fixed penalty notice of £400 is issued.

In addition, employers with between one and four employees, can be fined £50 a day. Those with between 5 and 49 members of staff can be fined £500 a day.

Now: Pensions chief executive Morten Nilsson says: “As time goes by, it’s becoming increasingly clear that when it comes to auto enrolment, smaller employers are divided into planners or procrastinators.

“While it’s worrying that one in five are missing their staging date, it’s also reassuring to see that a third are planning well in advance.

“Small business owners have a lot to think about and it’s easy for auto-enrolment to be put on the back burner but the fines for non-compliance are steep, missing the deadline can cause unnecessary sleepless nights.”

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Comments

There are 9 comments at the moment, we would love to hear your opinion too.

  1. Well you didn’t need a crystal ball to foresee this.

    We now come to the smaller firms who regard AE as something worse than a carbuncle on the bottom. Not to mention their employees who probably already have a personal pension in many cases and those that don’t are not keen on having their salaries reduced.

    These firms are not government benefit agencies and have a hard enough time sticking to the day job, which for many has just been made that much more difficult by Brexit.

    So fine the firms, put them out of business – then no pension and no job. Apart of course from the huge cost that will be incurred by the regulator chasing these unpaid fines.

  2. We are seeing the same trends emerge along with a lack of awareness as to the difference between their duties and the need to enrol workers.

  3. The only thing I am surprised at is that it is only 20% who are not meeting deadlines. I thought it was going to be more than that when it came to small employers. I do see this increasing once the micro employers start to get to their dates.

  4. If you run your own business and already have a pension they still require a response even when there are no eligible employees. A lot of small businesses are likely to find this confusing and another piece of uncessary paperwork to complete. Extending it to firms with only one or two employees is way over the top.

  5. Christopher Petrie 18th July 2016 at 1:15 pm

    EVERYONE in this country is now entitled to a pension fund, partly assisted by their Employer.

    It seems 80% of small businesses are complying…the 20% of laggards are not an indication of a broken system. They are simply laggards and must comply in the same way they have to pay wages, NI, VAT etc.

    A small extra hassle yes, but we’ll worth it for the population you all have their own pension fund. More people are starting their pension saving this year than pension salesmen set up in the whole of the 1980’s decade.

  6. Considerablyricherthanyou 18th July 2016 at 3:54 pm

    Of the 79% that did met their Staging Date deadline, I wonder how many did so in a compliant manner AND continue to operate their pension scheme in a compliant manner?

    This is going to get messy in a couple of years down the line when those errors from 2015/16/17 come to light.

  7. I know of one small employer who has reduced the hours of his staff and salary accordingly so that they are below the threshold for AE. It was either that or someone got made redundant!

  8. Hi David, well this small employer has broken the law and all to save 1% of band earnings at the moment!

    The main issue is educating smaller employers as to the actual costs and process it really isn’t that bad once you are informed. However, many prefer the Ostrich approach and will hope it goes away

    • Not ostrich, but irritation of imposition of wht is really government duty. Many feel this is big brother gone mad and regard it as nothing more than a (rising) tax.
      Many small firms have pps already in place they resent the unneccessary extra bureaucracy and fund them according to the fortunes of the firm. If no, or poor profit then no contribution. This is commercial sense.
      We have yet to see the real resistance from the micro firms.

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