So far over 50,000 large and medium sized employers have completed the process and with 1.8m smaller employers still to go between now and 2018 the biggest challenge has yet to come.
Despite having considerable in-house resources and being able to call on the services of expert advisers and consultants, the large companies that have ‘staged’ so far have mostly commented that it was not as easy as first thought.
Owners of smaller firms inevitably wear many hats and workplace pensions and auto enrolment can come low on the priority list. But like it or not auto enrolment cannot be ignored and leaving it to the last minute could result in poor choices being made. The rules say employers have a duty to ensure the best outcomes for their employees but this is wide-ranging and ill-defined.
Since AE was introduced in October 2012 The Pensions Regulator has issued 3,782 compliance notices for contravention of one or more employer duty provisions. Over 100 of these resulted in a fixed or escalating penalty ranging from £50 to £10,000.
Finding a suitable pension scheme is a daunting task and employers need to ensure appropriate expert help is consulted before making the decision, as what might appear to be a low cost, high convenience solution could come with a risk of far greater troubles and costs in the long run.