The Pensions Regulator has fined an employer £350,000 for failing to re-enrol staff into its workplace pension scheme.
Despite warnings from the regulator, the employer, who has not been named, allowed penalties from the TPR to accrue before correctly re-enrolling staff into the company pension scheme and paying the right contributions.
Employers have a duty to re-enrol staff who have left the pension scheme back into it every three years.
The company, which has more than 5,000 staff, has now re-enrolled more than 40 staff and paid over £100,000 of backdated pension contributions.
The backdated payments, which were in addition to the £350,000 fine, covered both the re-enrolment failure and incorrect contributions which affected more than 2,000 staff.
TPR director of automatic enrolment Darren Ryder said the size of the fine was rare as many employers now considered auto-enrolment to be part of running a business.
Mr Ryder said: “We do not want to fine businesses, we want them to meet their legal duties and we are here to help them do this.”
He added: “This case also demonstrates it’s vital to carry out both ongoing duties and re-enrolment correctly.
“We will take action to ensure that not only are staff put into a pension but they continue to receive the correct contributions on an ongoing basis, and that those who opt out are re-enrolled correctly and given their right to start saving.”
Last month (July 19), FTAdviser reported that TPR was only able to collect £8.9m, or 13 per cent, of the £68.6m in penalties issued during 2018-19 under auto-enrolment.
According to its annual report and accounts, there was a 37 per cent increase in fines issued to employers for not complying with their duties in this area, amounting to 49,032 penalty notices.
The regulator had not been able to collect £20.1m in fines but stated it had "proactively sought payment of any outstanding penalties" and this work would continue.
From the total of £68.6m in fines TPR decided to not pursue £9.2m, as some of these penalties were written off and others were considered to be in remission.
amy.austin@ft.com
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