The Pensions Regulator (TPR) has warned employers they must comply with their ongoing automatic enrolment duties after inspections found several errors.
TPR’s warning follows a series of in-depth compliance inspections of more than 20 large employers across the UK, with a total of nearly 1.5 million staff.
The alert to employers comes as TPR published its latest compliance and enforcement bulletin, which shows how many times TPR has used its auto-enrolment and frontline regulation powers between January and June this year.
The use of powers has remained broadly steady since the previous bulletin covering the six-month period of July to December 2021, TPR stated.
The inspections to check employers are complying fully with workplace pensions law were carried out earlier this year. They showed a number of common errors in respect of calculating pensions contributions and communications to staff.
Employers are being warned to ensure they do not skip important steps in complying with their ongoing duties and to consult TPR’s online information.
While the inspected firms successfully enrolled eligible staff into a pension and made contributions, administrative errors with their ongoing pensions duties put staff at risk of not receiving the pensions they are due, TPR has found.
The firms, which are across the transport, hospitality, finance and retail sectors, have now corrected or are working to correct errors, including making backdated contributions, the regulator added.
Mel Charles, TPR’s director of automatic enrolment, said: “The vast majority of employers are successfully meeting their automatic enrolment duties, however administrative mistakes can put staff at risk of missing out on their pensions and employers at risk of unintended non-compliance.
“While the errors we have found are technical in nature, these types of oversights can indicate broader non-compliance issues.”
He added: “Correcting these mistakes can be costly for employers because as well as needing to make backdated payments for staff receiving incorrect contributions, they can also lead to financial penalty.”
Key errors which can lead to employers needing to make costly backdated contributions include using incorrect earnings thresholds. Employers should ensure they consult TPR guidance on this. Employers should also ensure they check government guidance on maternity pay as miscalculating this can impact pensions contributions, it added.
Charles also highlighted that when completing re-enrolment, which employers must carry out every three years, they should check their systems and processes are up to date and running smoothly.
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