Missing contribution from previous employer who went into administration

masamune

Hello,

I'm seeking advice from the knowledgeable members of the forum regarding a somewhat unusual situation I've encountered.

My former employer had a salary sacrifice corporate pension scheme with a reputable pension fund. I contributed a percentage of my net salary, and they added another percentage as well.

Upon leaving, the final payroll accurately reflected all deductions for tax, employee/employer National Insurance, and contributions. Since payroll occurred near the month's end, contributions were debited to the pension scheme about a month later. I'm uncertain if this timing is standard, but it’s relevant to what happened next.

In addition to my former employer's scheme, I also set up a Self-Invested Personal Pension (SIPP), which I’ve been managing. A few weeks after I left, I requested my SIPP to initiate a transfer, but the fund informed me that my account was still actively accepting contributions. This was because the last contribution had yet to be debited. The status was visible through the online platform and a mobile app.

After reaching out to my ex-employer, they stated that the account had been settled and marked as closed to further contributions. The last contribution had indeed appeared on my account, also shown with the "transferable value" of the pot. Fast forward two weeks, and the transfer was completed; however, I noticed the amount transferred was short by an amount closely matching that last contribution.

I followed up with the corporate fund who advised that :

"the contribution was automatically shown on the account due to the debit instruction on record. However the debit had failed to collect from the employer and had since been removed from the account and hence from the value transferred".

They also advised that normally, they would have transferred any pending funds or gains to the SIPP as a matter of course. In other words the direct debit had failed or been canceled. 

Additionally, I discovered that my ex-employer filed for administration with HMRC shortly after the debit instruction was issued. This timing was just too coincidental.

Their HR is ghosting my emails which is frustrating, especially since the company hasn’t actually gone out of business; they've merely restructured under a new entity with the same name the day after the administration filing.

In conclusion, I’m exploring recourse options to recover the approximately £600 that was deducted from my very own salary. I’ve read there may be safeguards in place for recovering contributions under these circumstances and would appreciate some more experienced feedback please.

Marcon

masamune said:

Hello,

I'm seeking advice from the knowledgeable members of the forum regarding a somewhat unusual situation I've encountered.

My former employer had a salary sacrifice corporate pension scheme with a reputable pension fund. I contributed a percentage of my net salary, and they added another percentage as well.

Upon leaving, the final payroll accurately reflected all deductions for tax, employee/employer National Insurance, and contributions. Since payroll occurred near the month's end, contributions were debited to the pension scheme about a month later. I'm uncertain if this timing is standard, but it’s relevant to what happened next.

In addition to my former employer's scheme, I also set up a Self-Invested Personal Pension (SIPP), which I’ve been managing. A few weeks after I left, I requested my SIPP to initiate a transfer, but the fund informed me that my account was still actively accepting contributions. This was because the last contribution had yet to be debited. The status was visible through the online platform and a mobile app.

After reaching out to my ex-employer, they stated that the account had been settled and marked as closed to further contributions. The last contribution had indeed appeared on my account, also shown with the "transferable value" of the pot. Fast forward two weeks, and the transfer was completed; however, I noticed the amount transferred was short by an amount closely matching that last contribution.

I followed up with the corporate fund who advised that :

"the contribution was automatically shown on the account due to the debit instruction on record. However the debit had failed to collect from the employer and had since been removed from the account and hence from the value transferred".

They also advised that normally, they would have transferred any pending funds or gains to the SIPP as a matter of course. In other words the direct debit had failed or been canceled. 

Additionally, I discovered that my ex-employer filed for administration with HMRC shortly after the debit instruction was issued. This timing was just too coincidental.

Their HR is ghosting my emails which is frustrating, especially since the company hasn’t actually gone out of business; they've merely restructured under a new entity with the same name the day after the administration filing.

In conclusion, I’m exploring recourse options to recover the approximately £600 that was deducted from my very own salary. I’ve read there may be safeguards in place for recovering contributions under these circumstances and would appreciate some more experienced feedback please.

All is not lost!

See https://www.moneyhelper.org.uk/en/pensions-and-retirement/pension-problems/what-happens-to-your-pension-if-your-employer-goes-out-of-business and head for the section marked 'Defined Contribution Scheme' and note especially:

If this happens, you’ll need to contact the company that's managing the insolvency and ask for compensation for the value of these missing monthly contributions.

Depending on the circumstances, compensation may be claimed from the National Insurance Fund.

Normally, your own pension scheme administrator or the Official Receiver will make this claim on your behalf.

masamune

Thank you for this information, it sounds hopeful.

I am not entirely sure what next steps should be or who to contact next...

Would I need to find the appointed administrator's details and contact by letter or email (if applicable). Or

"These payments are generally claimed by your pension administrator or Official Receiver in cases of liquidation, via the Redundancy Payments Service. "

Who is the pension administrator, the Pension Fund receiving the contribution or a definition for another entity when administration is triggered?

thanks

Marcon

masamune said:

Thank you for this information, it sounds hopeful.

I am not entirely sure what next steps should be or who to contact next...

Would I need to find the appointed administrator's details and contact by letter or email (if applicable). Or

"These payments are generally claimed by your pension administrator or Official Receiver in cases of liquidation, via the Redundancy Payments Service. "

Who is the pension administrator, the Pension Fund receiving the contribution or a definition for another entity when administration is triggered?

thanks

As above: '...you’ll need to contact the company that's managing the insolvency and ask for compensation for the value of these missing monthly contributions.'

You can get their contact information from Companies House: https://www.gov.uk/get-information-about-a-company
and enter the exact name of your (former) employer. Be aware that the information may not show immediately but should be there pretty quickly - days not weeks.

You'd then need to write to them (probably by letter in the first instance) and say what your claim is. You need to be precise about the amount(s) involved and give the key date(s), and ask them what steps they will be taking to ensure the appropriate pension contribution payment is made. Don't worry about trying to sound either formal or legalistic; they just need to know you have a claim for money owed as a pension contribution and that you're expecting them to reply to you giving details of the next step.

masamune

This is all clear now, many thanks for responding.