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Auto-enrolment: employer pays £40,000 penalty for non-compliance

In May 2017, the Pensions Regulator issued a regulatory intervention report in relation to action taken against Johnson Shoes Company.

The Pensions Regulator has published details of action taken against a high street shoe retailer that resulted in the Regulator collecting over £40,000 in civil penalties for breaches of the employer auto-enrolment duties under the Pensions Act 2008.

After passing its staging date on 1 May 2014, Johnsons Shoes Company failed to provide the Regulator with a declaration of compliance by the statutory deadline. The Regulator initially issued a compliance notice. When Johnsons still failed to comply, the Regulator issued fixed, and then escalating, penalty notices. Although Johnsons eventually provided its declaration of compliance and paid the £400 fixed penalty in December 2015, it refused to pay the escalating penalty. This increased by £2,500 a day and by the time it stopped accruing had reached £40,000.

According to the Regulator, this is a reminder that, if an employer fails to co-operate fully with its enquiries and investigations, the Regulator will use all the powers at its disposal to ensure compliance with the statutory auto-enrolment duties.