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Pension Regulators Launch First Auto Enrolment Prosecution

The Pension Regulators have launched the first ever auto-enrolment prosecution. In a landmark case, the first of its kind, the Pensions Regulator is launching a prosecution against Stott Tours from Oldham.

Allegedly the bus company deliberately avoided enrolling staff into a workplace pension and subsequently is being accused of failing to comply with the auto-enrolment law.

Under section 45 of the Pensions Act 2008, the company’s Managing Director, Alan Stott, is accused of consenting or conniving in the company’s offence, or allowing it to be committed under neglect.

Pensions expert Tom Barton from Pinsent Masons believes the prosecution marks a new stage in the evolution of automatic enrolment and has said, “There have been plenty of fines dished out for non-compliance with auto-enrolment legislation.  These have generally resulted from procedural errors and oversights including the not-very-good excuse of running out of time. But the use of powers under section 45 is something new. Here we have an employer apparently engaging in intentional non-compliance, which is a serious business.”

“The policymakers have decided that workers are entitled to contributory pensions and it’s as simple as that. If employers want to get in the way of that policy intention then, ultimately, we’re not just talking about fines, we’re potentially talking about a spell behind bars,”

In 2012 auto-enrolment was phased in starting with larger employers and by February 2018 all employers will be obliged to provide a suitable pension scheme.

The rules state employers must automatically enrol workers into a scheme that meets specific minimum requirements.

If you would like to find out more about workplace pensions and how Ethos can help, don't hesitate to get in touch with us on 01302 244977.

In a warning sign to non-compliant companies the regulator has previously sent out fines. Between April and June 2017, it issued 4794 fines who failed to meet their obligations.

Offences can result in a two-year prison sentence, if tried in Crown Court, or an unlimited fine if tried in a Magistrates’ Court.

This information is intended to provide a general review of certain topics and its purpose is to inform but not to recommend or support any specific investment or course of action. The tips may not apply, or be suitable, to everyone and you should contact us for advice if you are unsure whether this is the case.


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Publish date: 9th November 2017

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