The first County Court Judgments (CCJs) for non-payment of auto-enrolment penalties have been issued to employers who have missed their staging dates, The Pensions Regulator (TPR) reports.
TPR’s latest quarterly bulletin, covering the fourth quarter of 2016, shows a near doubling in the number of Escalating Penalty Notices (EPNs) to 870, with 2,919 Fixed Penalty Notices (FPNs) issued in the quarter. This brings the total number of EPNs and FPNs issued to date to 1,477 and 9,831 respectively, although these figures are is against a backdrop of over 100,000 employers that declared their compliance during the same quarter.
CCJs stay on an employer’s record for six years, potentially affecting their ability to get credit.
TPR says pubs, clubs and restaurants now staging are at higher risk of non-compliance as this sector typically employs a large number of temporary workers, has a high level of English as a second language and a prevalence of non-standard contracts.
The report notes that a small number of employers have now been handed County Court Judgements (CCJs) after failing to pay their automatic enrolment fines.
This can happen when employers persistently ignore penalty notices sent to them by TPR. Employers that fail to pay within 30 days of receiving the CCJ, will have the details entered on their credit record.
The report has the example of a South London removals firm who took nearly two years to comply with their automatic enrolment duties, despite receiving two fixed penalty notices (FPNs) and an escalating penalty notice (EPN). It was only when TPR applied for a CCJ that the employer became compliant and paid their fines.
TPR executive director of automatic enrolment Charles Counsell says: “A CCJ goes onto an employer’s credit record and remains there for six years, seriously affecting their ability to borrow money for their business in the future.
“Burying your head in the sand and ignoring your legal duties means your staff are missing out on pensions they are entitled to and your credit rating and reputation could be hit.
“Our message to small and micro employers has always been to ensure they leave enough time and be clear about what they will need to do to comply. We are here to help – but we will take action if an employer is wilfully non compliant.
“There’s plenty of information on our website on how to assess and enrol people who work varying hours, so there’s no excuse not to comply.”
Aviva MD business solutions Andy Beswick says: “No one wants to see small businesses being penalised for not complying with auto-enrolment. A workplace pension can be a great asset to an employer when it comes to retaining and attracting key staff. It’s also a legal requirement so ignoring it isn’t an option.
“There are a number of pension providers who have worked hard to make auto-enrolment as simple as possible for companies and advisers. With a bit of planning, the process of setting up a workplace pension is not as complicated as most people think.”