Employer fined for failing to pay AE fines

Jamie Clark gives the lowdown on what happens when an employer fails to pay auto-enrolment fines.

An employer has been served County Court Judgement (CCJ) for failing to pay auto-enrolment fines, according to the latest data from The Pensions Regulator (TPR).


TPR cite a case where a removal company continually ignored them despite having been issued both a fixed and escalating penalty notice. Eventually, TPR used their powers to inspect the premises and engaged with the employer’s accountant to try and get things sorted out. However, it was only after a CCJ was served that the employer paid the fine and complied with their duties. Not only did they have to pay the fine, they also had to pay two years’ backdated pension contributions.

Failure to pay a CCJ within 30 days can have serious ramifications for an employer as it gets entered onto their credit record for six years and so could affect their ability to secure lending in the future.

More employers staging means more fines issued

TPR is keen to stress that although more employers are facing action for AE failures, this is in direct proportion to the amount of employers who have declared their compliance. In percentage terms, it looks like most employers are in fact complying with the employer duties although TPR doesn’t say how many employers did NOT declare their compliance.

Penalty notices issued from October 2016 to December 2016, 100,000 employers declaring compliance in the same period
Penalty type Amount issued % of those 100,000 who declared compliance
Fixed Penalty Notice 2,919 2.919%
Escalating Penalty Notice 870 0.87%

Failure is not an option

Employers who fail in their duties have come up with various excuses as to why they didn’t comply. Employers who disagree with a fine can first of all appeal to TPR. If they’re still not happy, they can then appeal to the Tribunal Service and more and more employers are doing just that.

However, in all the cases so far no employer has succeeded in persuading the Tribunal that they had a reasonable excuse for non-compliance.

What does it mean for advisers?

Even if you won’t be involved in helping an employer through auto-enrolment, it will be useful to have a process in place to deal with them.

For example, some advisers are referring auto-enrolment enquiries to another adviser firm in the area.

Other advisers simply refer employers to one of the master-trust schemes such as NEST where they can set up a ‘self-serve’ solution, sometimes in conjunction with the employer’s accountant.


TPR, Automatic Enrolment Compliance and Enforcement Quarterly bulletin 1 October – 31 December 2016.


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