As pension auto-enrolment enters a critical stage, thousands of small and micro businesses will now be thinking about their employer duties. With enforcement action for non-compliance on the rise, employers should ensure that they fully understand their new responsibilities.
Responsibility to enrol employees into a pension scheme lies with the employer. Employers are required to automatically enrol eligible workers into a qualifying workplace pension scheme and pay a minimum contribution into the fund. Eligible workers are those aged between 22 years and the State Pension Age who have qualifying earnings above the earnings trigger for automatic enrolment.
It’s the Law, the penalties for non-compliance include a Fixed Penalty Notice of £400, and statutory notices with a prescribed daily rate of £50 to £10,000, depending on how many individuals a business employs.
The Pensions Regulator may also issue a civil penalty in cases where the employer fails to pay their contributions. These can range from £5,000 for individuals and £50,000 for an organisation. Where an employer fails to pay a penalty and remains non-compliant, the Regulator may seek criminal prosecution.
More information can be found on the Pension Regulator’s website at www.thepensionsregulator.gov.uk.
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