Auto enrolment penalties on the rise

By Mattioli Woods

30 Sep 2016

Automatic enrolment (AE) into a workplace pension has been here for a while now and depending on their staging date, small and micro employers have been required to engage with the process to ensure relevant workers are enrolled correctly and on time.

By Paul Jackson, Taylor Patterson.

While the vast majority of small and micro employers are successfully meeting their duties, it is clear from the recent bulletin from The Pensions Regulator (TPR) that, as the numbers beginning their employer duties are increasing, so the numbers of penalties are also increasing.

This could be due to the very simple fact that, whereas medium and large companies have trained and dedicated staff to deal with payroll and the automatic enrolment of workers, small and micro employers often do not.

Employers need to be aware of their duties and what support is available to them; There are financial consequences of failing to fulfil their employer duties. There are options for advice out there. These are the actions that employers must take at their staging date to avoid the risk of a penalty: pick a qualifying pension scheme complete the assessment of workers correctly and on time enrol the relevant workers automatically communicate in writing to all workers complete the declaration of compliance. TPR reports that the most common error is failure to complete the declaration of compliance at the end of the staging process.

Just as there are penalties involved with incorrectly processing or neglecting to process income tax and National Insurance (NI) contributions, so there are with a failure to apply AE and general pension processes correctly. Some of the other areas in which non-compliance can trigger penalties are: Failure to make employer contributions to the pension company - fine up to £50,000 Failure to pay over worker's contributions to the pension company – fine up to £50,000 Of the small employers required to enrol their staff into a workplace pension, TPR reports that more than 95% have met their duties. However, according to TPR's bulletin (1 January – 31 March 2016), 3,057 compliance notices, 806 fixed penalty notices and 96 escalating penalty notices were issued, indicating that many employers are still getting it wrong.

Remember that it is the employer, not their agent or the member of staff, who holds the legal responsibility for complying with the law.

Workplace pensions are not going to go away, and the attitude to retirement has changed. It is now seen as the third, or golden age, and employees will need to save while working so that funds are available for planned projects during retirement. Historically this has not been happening, so employers have to play a much bigger part. The employer duties for auto enrolment if not met successfully by small and micro employers, will mean further increases in the number of penalties being issued and paid.

Latest news

1

Roundhouse secures approval for new £15m office and industrial scheme in Preston Momentum

Roundhouse secures approval for new £15m office and industrial scheme in Preston

25 Jul 2025

2

Homebuilder's high-performing sales advisers clinch awards Ben Garland and Julia Lorente

Homebuilder's high-performing sales advisers clinch awards

24 Jul 2025

3

Work is set to start on Multiversity project Multiversity Blackpool

Work is set to start on Multiversity project

24 Jul 2025

4

BAE Systems welcomes MOU between Republic of Turkiye and UK for purchase of Typhoon aircraft Typhoon production Warton

BAE Systems welcomes MOU between Republic of Turkiye and UK for purchase of Typhoon aircraft

23 Jul 2025

5

Assystem to double UK jobs to deliver Sizewell C EDF Assystem

Assystem to double UK jobs to deliver Sizewell C

22 Jul 2025

Background image for hub sign up block

LBV Hub

Leverage Lancashire Business View platforms

Post your news
Post your events
Post your offers
Build your network
Improve your SEO
Gain coverage in the magazine
Sign-up
Events
Lancashire Built Environment Conference 2025
BEC 315 X 315 Px
Networking
25 Sep 2025

Lancashire Built Environment Conference 2025

Blackpool Football Club, Blackpool, FY1 6HX

08:30 - 13:00

CMI Level 5 Project Management Course
UCLanAerialCampus.jpg.jpg
LBV Hub Seminars
21 Feb 2025 - 21 Feb 2026

CMI Level 5 Project Management Course

Preston Campus, Preston, PR1 2HE

08:00 - 17:00

CMI Level 5 Management and Leadership Course
UCLanAerialCampus.jpg.jpg
LBV Hub Seminars
21 Feb 2025 - 21 Feb 2026

CMI Level 5 Management and Leadership Course

Preston Campus, Preston , PR1 2HE

09:00 - 17:00

Preston Tech Connection: Buzz Word Bingo. Challenging Todays's Buzzwords In Tech
July PTC banner long updated.png.png
LBV Hub Networking
29 Jul 2025 - 29 Jul 2025

Preston Tech Connection: Buzz Word Bingo. Challenging Todays's Buzzwords In Tech

Society1, Coworking Space, Preston, PR1 3LT

18:00 - 19:30

Preston Freelancer Meet-Up: July
Longer July Banner.jpg.jpg
LBV Hub Networking
31 Jul 2025 - 31 Jul 2025

Preston Freelancer Meet-Up: July

Society1, Coworking Space, Preston, PR1 3LT

10:00 - 11:30

Advantage: AI – A Workshop for Business Leaders – August 14th
Navy--Event Tile.png.png
LBV Hub Seminars
14 Aug 2025 - 14 Aug 2025

Advantage: AI – A Workshop for Business Leaders – August 14th

Door4 Office, Burnley Wharf, Burnley, BB11 1JG

09:00 - 12:00

The Business Network Central & East Lancashire
LBV Header (24).png.png
LBV Hub Networking
21 Aug 2025 - 21 Aug 2025

The Business Network Central & East Lancashire

Mytton Fold, Langho, BB6 8AB

11:30 - 14:15

Morecambe Bay Walk
Walk.jpg.jpg
LBV Hub Awards
30 Aug 2025 - 30 Aug 2025

Morecambe Bay Walk

Arnside, CARNFORTH, LA5

09:30 - 14:00

Longridge Soap Box Derby
Screenshot 2025-06-10 090035.png.png
LBV Hub Fundraisers
14 Sep 2025 - 14 Sep 2025

Longridge Soap Box Derby

Berry Lane, Longridge, PR3 3WH

10:00 - 16:30

Cumbria Business Expo 2025
https---cdn.evbuc.com-images-880461633-4862066883-1-original.20241022-110415.jpeg.jpg
LBV Hub Exhibitions
19 Sep 2025 - 19 Sep 2025

Cumbria Business Expo 2025

Carlisle Racecourse, Carlisle, CA2 4TS

09:00 - 15:00

Help to grow management course
Help to grow - barriers to growth.png.png
LBV Hub Seminars
26 Sep 2025 - 16 Dec 2025

Help to grow management course

Preston Campus , Preston , PR1 2HE

09:00 - 15:00

RISE - Lancashire's unique leadership programme for women
thumbnail_Emma Weston Illustration WENDY BOWERS RISE Illustrstion.jpg.jpg
LBV Hub Seminars
22 Oct 2025 - 18 Mar 2026

RISE - Lancashire's unique leadership programme for women

East Lancashire Chamber of Commerce, Clayton le Moors, BB5 5JR

09:30 - 15:30

Advertise with us

Reaching 50,000 members, our print, digital and event platforms offer a fantastic way to raise your business profile and help you grow.

Find out more LBV 123 Online Graphic
Subscribe now

Weekly news bulletin