If you’re a small business, do you understand your legal responsibility towards providing your staff with a workplace pension?

With over half a million small and micro employers due to provide their employees with a workplace pension this year, the need for advice and support is ever more important, and ignoring your duties will simply land you in hot water.

The facts are clear – Many small and micro employers don’t have the internal expertise or resource to deal with Auto Enrolment. But, if they don’t, they will face fines and rue the day they ignored the need to start planning. Although no big announcements are being made about it, fines are being distributed, and the number of enforcement notices are mounting, in correlation with the far increased number of businesses this year that are staging. Are these businesses leaving it too late to start planning? Probably. And they need to bear in mind that supporting organisations such as IFA’s will also be under increased strain to deal with the amount of enquiries for Auto Enrolment, not forgetting the providers themselves who may simply choose not to provide terms if contacted too late in the day.

What fines could you expect? Well that depends on how you are perceived to be dealing with the process. If you ignore all warning notices, the likelihood is The Pensions Regulator will not treat you lightly. Fixed rate fines currently stand at £400 with additional daily fines for those that continue to ignore the notices. That’s an awful lot of money for a small / micro business. Businesses need to remember that Automatic enrolment is the law for all employers – and they will use their powers where necessary to get them back on track.

There are other worrying issues that are now cropping up with smaller businesses going through the process. It has been reported that some businesses are incentivising staff to opt out in favour of receiving cash today rather than in retirement. This obviously totally undermines Auto Enrolment and the progress made through the legislation in ensuring employees are all preparing for their retirement. Asking staff or incentivising them to opt out is not allowed and if proven, The Pensions Regulator are unlikely to look favourably upon these non-compliant businesses.

One of our Brighton and Hove based independent financial advisers can arrange a meeting at a mutually convenient place to talk you through the process of the workplace pension.

Simply call 01273 208813 or email [email protected]

IEP Financial are authorised and regulated by the Financial Conduct Authority (FCA)

This article was originally published on Tuesday, April 19, 2016 – 10:57

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