First prosecution for failing to provide workplace pension
13 Feb 2018
A bus company and its managing director will have to pay more than £60,000 after they admitted trying to deliberately avoid giving their staff workplace pensions, in the first such prosecution by The Pensions Regulator (TPR)
13 Feb 2018
Stotts Tours (Oldham) and Alan Stott pleaded guilty to a total of 16 offences of wilfully failing to comply with the law on workplace pensions. They should have put 36 staff into a workplace pension and begun paying pension contributions from June 2015.
At Brighton Magistrates’ Court the company was ordered to pay a £27,000 fine, £7,400 costs and a £120 victim surcharge, while Stott was ordered to pay a £4,455 fine and a £120 victim surcharge.
These charges are on top of the £14,400 in civil fines that the employer already owes for failing to comply with the law on automatic enrolment.
Stotts Tours (Oldham) must also pay an estimated £10,000 in backdated pension contributions for its staff, as well as paying all ongoing contributions that fall due, or they will face further enforcement action from TPR.
Darren Ryder, TPR’s director of automatic enrolment, said: ‘Compliance with automatic enrolment remains very high and so it’s extremely disappointing that a tiny minority of employers continue to flout the law by denying their staff the pensions they are entitled to.
‘This case shows the cost to employers that failing to comply with automatic enrolment can bring – a bill of tens of thousands of pounds, a criminal conviction and a damaged reputation.’
Latest figures from TPR show one million UK employers have enrolled staff into a workplace pension, covering some 9m employees. Over 600,000 employers have complied with their duties in the past year alone, while the deadline is approaching for the remaining 150,000 employers, including new businesses set up since the government scheme was launched, to enrol their staff by June 2018.
Government statistics indicate workplace pension participation in the public and private sectors has increased from a low of 55% in 2012 to 78% in 2016. The most significant increases have been among the lowest earners, younger people (those aged 20 to 29) and women.
In 2016, the total amount saved annually in workplace pensions by eligible savers was £87.1bn, a 10 year high. It is estimated that the introduction of automatic enrolment will have increased pension contributions by around £20bn a year by 2019/20.
Report by Pat Sweet