Auto enrolment came into force in 2012, however until recently, the scheme applied only to larger companies. Now, businesses of all sizes face fines if they fail to comply.
Auto-enrolment is the name given to the law which requires employers to put certain staff into a pension scheme and contribute towards it. The Pension Regulator has, between October 2015 and December 2015, issued nearly fifteen hundred £400 fines to businesses that have failed to comply.
Over 500,000 small and micro employers are due to stage in 2016, with 87,000 filing Declarations of Compliance in January 2016.
Mark Szulczynski, Payroll Manager at Ellis & Co, said: “The auto enrolment legislation applies now to all businesses, regardless of size, but many business owners do not realise the serious implications if they fail to comply.
“The penalties and fines applicable to businesses that fail to meet the requirements of the auto enrolment law are significant.
“A key requirement to be compliant is to have a suitable workplace pension scheme in place which can be challenging to set up.”
The Pension Regulator issued the following statement:
"Our research shows that most employers want to do the right thing by their staff but that smaller employers are more likely to leave things to the last minute. They therefore need a "nudge" to encourage them to meet their duties.
“A minority still don't comply after receiving a notice of non-compliance, but many do after receiving a fixed penalty of £400. As we deal with smaller employers, it is expected there will be more who, despite the message to prepare early, leave it too late or don't act at all. We take this very seriously."
For more information on auto-enrolment and setting up a workplace pension scheme, please contact Mark on 01244 343504.