Employer deducting pension contributions but not paying it to scheme

Marcon

steve0510 said:

They have, from memory 19 days from receipt of the funds (deductions) to invest them,  Late investments need to be reported by the Trustee to the Pension Regulator.  Do you know if anyone has done this?

There won't be a trustee if it's a personal pension scheme. Employers have until 19th of the month following deductions from an employee's earnings to pay over the funds.

kaMelo said:

Assuming this pension is through auto-enrolment and If those dates are correct, nothing paid into the pension since April 2019, then the pension company have failed in their duty as well. Whilst they cannot force an employer to do anything they should have notified the pension regulator a long time ago, who does have the power to do something, about the employers failure to maintain their duties.
The employer is breaking the law and they are who to speak to first. I would suggest contacting the the pension company too and ask them what they have been doing for the last 20 months..

Usually non compliance is dealt with through fines but it can lead to prosecution with up to two years imprisonment in the worst cases. 

OP has already confirmed that the pension scheme has reported the employer to the Regulator 'numerous times'. There is little more the scheme can do if the Regulator takes no action.

charmedsocks said:

Albermarle said:

MEM62 said:

If they go bust there is no point, your money is lost.    

You are very likely correct but I would have thought the Directors could at least be barred for what is clearly a fraud on the employees. 

at a minimum I want them to be barred. but not sure how i go about it. I've bitten the bullet and gone to a lawyer for advice 

Unless the lawyer has specialist pensions knowledge, they aren't going to be able to offer you any advice which improves on what TPAS and the Pensions Ombudsman have told you. You say the Ombudsman has 'given you some actions' - please could you share what those are in case anyone here can give you a bit more help?

Albermarle said:

MEM62 said:

If they go bust there is no point, your money is lost.    

You are very likely correct but I would have thought the Directors could at least be barred for what is clearly a fraud on the employees. 

Very unlikely, although it would certainly be an attractive option for people like OP's husband who are being given the runaround.

kaMelo

I actually missed the part about the regulator already being notified so apologies for that, the pension company have kept their end up.
I have no idea why the regulator is dragging their heels though. 
Anecdotally I know one company who thought it was okay to take a payment holiday "due to covid" for six months last year. 
The regulator got involved and dealt with it pretty quickly, issued a significant fine for non compliance and gave 28 days to make up all missed payments to prevent further enforcement measures.

LHW99

More than likely the business is hanging on. Late filing of annual accounts is a clear sign that the auditors are unable to sign them off. 

Depends how small the company - below a certain size auditing is not required. However missing Cos. House deadlines repeatedly is not good.

Marcon

Thrugelmir said:

charmedsocks said:

From our perspective, there is little to no protection for employees in this situation and we feel really let down by the system.

Action should have been taken a very long time ago. At the very least opting out of the pension scheme. Once the issue became apparent. 

More than likely the business is hanging on. Late filing of annual accounts is a clear sign that the auditors are unable to sign them off. 

Hindsight is a wonderful thing. People who fear for their jobs, and live in hope that all may yet be well, and believe that 'the system' will help them (as indeed they are entitled to expect; that's what the Pensions Regulator is there for) aren't especially likely to give up the 'free money' which comes with a workplace pension.
 
OP has already said it's a small business. Chances of it needing an audit are highly unlikely, given that it would almost certainly meet at least two of these requirements for audit exemption:

• an annual turnover of no more than £10.2 million
• assets worth no more than £5.1 million
• 50 or fewer employees on average

atush

Take them to small claims now, not after they fold.

steampowered

Your husband could resign, and take his claim to the Employment Tribunal for constructive dismissal. He would claim for the unpaid contributions, plus notice pay, plus compensation for unfair dismissal if he has been there for more than 2 years.

Deducting money for pension contributions but not paying it to the pension scheme sounds like it may be enough to be classed as fraudulent, which would open the directors up to personal liability. That would be pursued by issuing a county court claim against the directors via the government's "moneyclaimonline" service. It's actually pretty straightforward to do this.

Thrugelmir

Marcon said:

Thrugelmir said:

charmedsocks said:

From our perspective, there is little to no protection for employees in this situation and we feel really let down by the system.

Action should have been taken a very long time ago. At the very least opting out of the pension scheme. Once the issue became apparent. 

More than likely the business is hanging on. Late filing of annual accounts is a clear sign that the auditors are unable to sign them off. 

OP has already said it's a small business. Chances of it needing an audit are highly unlikely, given that it would almost certainly meet at least two of these requirements for audit exemption:

• an annual turnover of no more than £10.2 million
• assets worth no more than £5.1 million
• 50 or fewer employees on average

Lenders may require sight of externally audited accounts as a condition of providing credit facilities. . 

MEM62

Albermarle said:

MEM62 said:

If they go bust there is no point, your money is lost.    

You are very likely correct but I would have thought the Directors could at least be barred for what is clearly a fraud on the employees. 

Of that I have no doubt but that isn't going to recover the OP's contributions. 
Instead of wasting time and money engaging a lawyer the OP should have sent an LBA and submitted a claim through the county courts.  

LHW99

Thrugelmir said:

Marcon said:

Thrugelmir said:

charmedsocks said:

From our perspective, there is little to no protection for employees in this situation and we feel really let down by the system.

Action should have been taken a very long time ago. At the very least opting out of the pension scheme. Once the issue became apparent. 

More than likely the business is hanging on. Late filing of annual accounts is a clear sign that the auditors are unable to sign them off. 

OP has already said it's a small business. Chances of it needing an audit are highly unlikely, given that it would almost certainly meet at least two of these requirements for audit exemption:

• an annual turnover of no more than £10.2 million
• assets worth no more than £5.1 million
• 50 or fewer employees on average

Lenders may require sight of externally audited accounts as a condition of providing credit facilities. . 

That may be true, although having run a micro-business for 20 years, I have not had that issue. The only time auditing was required was after receiving a government / EU grant - very difficult, if you are not a regular customer, and very expensive in comparison with the size of grant awarded.