Reg to punish auto-enrolment non-compliance

The watchdog has a sliding scale of penalties for employers based on their size, and will command a 200-300 strong team to enforce the rules over 1.3m UK businesses.

The initial fine for employers who fail to register will be £400. Persistent non-compliance will be punished with additional fines.

Businesses with 500 employees or more will have to pay £10,000 a day if they breach auto-enrolment duties, while those with four or fewer will pay £50 daily.

Charles Counsell, executive director for employer compliance at the regulator said: “Clearly wilful or persistent non-compliance cannot be left unchecked, but we will take a stepped approach.

“We will give small employers a fair opportunity to comply before taking further action, such as issuing a fine. There will be telephone support to help them through the process if they are having difficulties, as well as hardship policies for the most difficult cases.”

Counsell also claimed he hoped “successful communications with employers in the first instance will reduce problems at the compliance end”, while press officer Ben Lloyd added: “Enforcement will be a last resort.”

Businesses with over 250 employees will be warned of the changes 18 months before their due date and will receive further notifications 12, six and three months prior to it.

Medium, small and micro employers will be informed 12, six and three months in advance. While high-volume, low-complexity tasks such as sending letters will mainly be outsourced, the team will help businesses register and make payments, and take action to deal with those who fail to comply.