What aren’t I allowed to do and what happens I don’t comply?

The auto-enrolment obligations are set out in legislation and The Pensions Regulator is responsible for ensuring compliance with the rules. So to make sure you’re not breaking the law, it’s a good idea to make yourself aware of the main things you mustn’t do.

You mustn’t:
– Encourage employees to opt out or give up active membership of the pension scheme – this is known as ‘inducement’
– Coerce employees to opt out of the pension scheme
– Discriminate against employees seeking to join a pension scheme
– Take or fail to take any action that leads to an eligible employee ceasing to be an active member of a qualifying scheme, or that results in the pension scheme, of which they are a member, ceasing to be a qualifying scheme
– Operate prohibited recruitment where a job applicant’s success of getting the job depends on whether or not they opt out.

If you don’t comply, The Pensions Regulator will initially focus on education rather than imposing fines for non-compliance. If you don’t meet your duties, they’ll initially just tell you to put things right. Any further failure may lead to the government fining you a lot of money. In the event of persistent and deliberate non-compliance, The Pensions Regulator can issue escalating penalty notices of up to £10,000 a day. And, ultimately, you could face criminal prosecution and even imprisonment.


Find out more on The Pensions Regulator’s website.

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