There has been a surge in the number of warnings issued to SMEs over failure to comply with the government’s flagship auto-enrolment legislation, which is in the process of being introduced in stages to businesses – from largest to smallest – across the country.
The number of businesses to be given fines Pensions Regulator has increased 14-fold in just three months.
While six million employees have already been enrolled at 58,000 employers, MPs are said to be concerned with the lack of compliance from SMEs as we reach the stage where 1.8 million small firms are faced with enrolling their staff and administering the changes to their payroll processes.
With fines of up to £500 a day (businesses with more than five staff) or £50 penalties (businesses with less than five staff), it’s certainly within the interests of these organisations to meet their responsibilities.
The lack of resources at smaller firms has been cited as a reason for the slow administering of the new pension scheme, while industry experts have suggested smaller companies may struggle financially to implement the new changes as they prepare for the imminent implementation of the new National Minimum Wage.
Larger FTSE 100 listed companies were the first to enrol, with the likes of BP, Shell and Tesco being forced to change their pension offerings in line with the legislation and ensure their employees were saving for the future.
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If your business is yet to face auto-enrolment and you are worried about meeting the criteria involved when complying with the legislation, you need the payroll staff to make sure you avoid receiving a fine from the Pensions Regulator.
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