- the responsibility for complying with the employer duties rests with your clients
- if your client doesn’t comply, they may face enforcement action
- enforcement action usually starts with statutory notices and is followed by penalty notices, which we can recover through the courts
- if your client complies late, we expect them to pay back any missed contributions to put staff in the position they would have been in if they had complied on time; this may include backdating contributions to the day that the member of staff first met the age and earnings criteria to be put into a scheme
- deliberately failing to enrol eligible staff and knowingly including false information in a declaration of compliance are criminal offences and may result in prosecution
If your clients are late complying with their duties
Our overall approach is to educate your clients and enable them to comply with the legislation, putting them in a position to make the right choices and decisions. Your clients should remember that responsibility for being compliant rests with them.
In cases where your clients haven’t understood their duties or have been unable to comply, we'll provide support and work with them to get them compliant. However, if they have chosen to ignore their duties, we may use our powers where necessary to ensure compliance.
If your client is late complying or thinks they might be, they should tell us about it straight away. Our policy is that employers should take reasonable steps to put all workers back in the position they would have been in if they had complied on time. The employer should not profit from their mistake.
For example, if your client fails to enrol a worker into a pension scheme when they should have done, they will need to:
- enrol them in a pension scheme
- ensure members of staff are in the position they would have been in had the employer complied on time - we expect the employer to backdate contributions to the day that they first met the age and earnings criteria to be put into a scheme so that the member of staff does not lose out
- give staff the option to pay their own backdated contributions - the staff can choose whether or not they wish to do this
How we investigate non-compliance
We have a range of powers for use in our non-compliance investigations.
As well as requesting information from employers voluntarily, we're able to issue formal notices asking for information and we're able to carry out inspections at the employer's premises. We will use the courts to carry out investigations where necessary.
Our investigations are conducted to the highest standards, ensuring we regulate with fairness, transparency and consistency.
Our enforcement options
Our full range of enforcement options is summarised below and is also explained in the quick guide to our compliance and enforcement strategy at the end of this page.
We can issue guidance and instruction by telephone, email, letter and in person. We can also send warning letters confirming a set time frame for compliance with the duties.
Statutory notices are sent in the post, and can direct your clients to comply with their duties and / or pay any contributions they have missed or are late in paying.
If unpaid employer contributions are not paid within three months of the notice being issued, your client can be required to pay any outstanding staff contributions too.
Penalty notices are sent in the post, and can be used to punish persistent and deliberate non-compliance.
A fixed penalty notice may be issued if your clients don’t comply with statutory notices. This is fixed at £400 and payable within a specific period. We can sometimes issue a fixed penalty without having first issued a statutory notice.
We can also issue an escalating penalty notice for failure to comply with a statutory notice. This penalty has a prescribed rate of £50 to £10,000 per day depending on the number of staff your client has.
We can issue a civil penalty for cases where your client fails to pay contributions that are due. This is a financial penalty of up to £5,000 for individuals and up to £50,000 for organisations.
We aim to fully recover all the penalties that we issue using court action if necessary.
If your clients have received a penalty notice, they can pay it using our secure online payment service. They should have their penalty notice reference handy (shown on the front of the notice).
Your client should ensure their payment is received by the date shown on the front of the penalty notice. Failure to pay the penalty can result in The Pensions Regulator bringing formal legal proceedings to recover the penalty.
We can take civil action through the court to recover penalties.
Any of your clients who deliberately fails to enrol eligible staff or knowingly includes false information in a declaration of compliance may be prosecuted.
Appealing an enforcement notice
If your client has been issued a notice they can apply to us for a review. Your client's application along with supporting documentation must be made within 28 days of the notice being issued. Upon receipt of your client's application, we will inform you when a decision can be expected.
For more information go to appealing an enforcement notice.
Compliance and enforcement strategy
Provides a framework for our regulatory approach, and explains the various options available to us to maximise employer compliance.
Compliance and enforcement policy
Explains our approach to minimising non-compliance with the duties and safeguards, and associated legislation.
Compliance and enforcement bulletins
Our automatic enrolment compliance and enforcement quarterly bulletins provide information about our cases, and the powers we have used relating to automatic enrolment and associated employer duties.
Declaration of compliance monthly reports
A rolling report updated every month with the latest automatic enrolment declaration of compliance numbers, plus commentary and analysis.