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The Pensions Regulator (TPR) is to get ‘clearer, quicker and tougher’ on employers who breach their automatic enrolment (AE) pension duties by conducting short-notice inspections.

Applies to all employers

The auto-enrolment scheme, which began in 2012, applies to all employers. It ensures that all employees are opted in to a workplace pension. Contributions, from both employer and employee, went up from 6 April 2019. To ensure employers are adhering to their AE pension duties the watchdog is using data to pinpoint specific employers across the country who are suspected of breaking the law. They will be targeted with short-notice inspections.

Mandatory inspections

The inspections started mid-May and will continue throughout the summer. It is mandatory for employers to take part in them. The watchdog will also contact employers by phone to validate information held related to them meeting their duties. The checks are to ensure that all employers are complying fully with their AE duties.

Whilst the vast majority of employers are doing things right, there are a small minority who ignore their responsibilities. The TPR is using its data intelligence to detect and target non-compliers and take swift action. Failure to comply with the inspections or providing the required information is a criminal offence, and non-compliance could result in fines or court action.

Allowance for errors

The regulator also recognises that AE is fairly complicated and employers may inadvertently break the rules. In this case they will be given time to get things in order and make good any shortfall.

The AE scheme aims to help people help themselves and thereby helps to change people’s saving behaviour. By February this year, the scheme had led 10 million workers into auto-enrolment and fewer than 10% of those eligible had opted out. However, there are still more than nine million workers not in any workplace pension.

The watchdog also announced plans last month to reduce the number of poorly-run schemes as it seeks to improve standards across the board.

Get in touch with Howards

If you are confused by pension auto-enrolment get in touch with us at Howards, we’ll help to make things clear.