Automatic Enrolment will hit all small businesses across the UK very soon. By 2018, even if a business has one employee, you will be required to comply with pension legislation part of the new pension reform. Many small employers are being advised to prepare now and be familiar of their duties, as ignoring Automatic Enrolment will be costly. The penalties for ignoring Automatic Enrolment have been made in available in the latest figures released by The Pensions Regulator.
The figures for the third quarter 1st July to 30th September 2016 shows there has been a huge increase in the number of notices and penalties served to employers for non-compliance with Auto Enrolment. The statistics of the third quarter are shown below.
- 15,073 compliance notices have been sent out to businesses, this is a rise of over 344% from the last quarter where just 3,392 were issued.
- 3,728 fixed penalty fines of £400 have been issued, also an increase of over 332% on last quarter, in which only 861 were sent.
- 576 escalating penalty notices have also been issued.
An escalating penalty is issued when previous compliance notices are ignored so The Pensions Regulator acts. These are dependent upon the size of the business and can carry a fine ranging between £50 and £10,000 per day.
A rise in small employers staging in 2017 who are complying with these duties has shown a dramatic increase in penalty fines sent out by the The Pensions Regulator. The requirements to comply with the legal framework set by Automatic Enrolment have shown to been difficult, with most businesses stating that, illness, being busy with general workload and confusion about the new laws have been the main cause for this.
TPR have said that reasons given by employers such as these, aren’t a ‘reasonable excuse’.
Automatic Enrolment was first introduced in 2012 and The Pensions Regulator made it very clear from the start that it is the law, and business and employers must comply with the new laws. Since 2012 the number of penalties that have been served out are the following.
- 741 escalating penalty notices
- 26,040 compliance notices
- 6,779 fixed penalty notices.
Ontime are here to help. We know that complying with laws surrounding Automatic Enrolment can be confusing to some employers. Therefore, we are including our Automatic Enrolment solutions as part of our payroll services.
Speak to us today on 0113 8267260 to see how we can help your business.