My employer did not set up a pension scheme in the workplace. The date for implementation was 2015.
I resigned in 2021 and still was not auto enrolled. I know they have set this up now for their employees.
Can you advise on my position regarding getting my six years’ pension payments made by them and whether they are liable for my contributions also.
SCROLL DOWN TO FIND OUT HOW TO ASK STEVE YOUR PENSION QUESTION
Lost contributions: My old employer failed to set up a pension scheme while I worked there, but has done now – can I still join?
Steve Webb replies: Provided that you and your employer both fell within the scope of the legislation on automatic enrolment at the time, you have a legal right to a pension for the period concerned, so you should certainly take matters further if this did not happen.
The first thing to check if possible is when your employer reached their ‘staging date’ for automatic enrolment.
When automatic enrolment started in 2012 it applied initially only to the country’s biggest private sector employers. The duty to enrol was then extended in a series of stages based on firm size until it applied to all employers from 2017 onwards.
From your question I’m assuming that your employer had a ‘staging date’ of October 2015, though in some circumstances this could be put back by three months.
But after that date they would have had a legal duty to enrol all ‘eligible jobholders’. These were people who:
– Were aged between 22 and state pension age (inclusive) AND
– Earned above £10,000 per year AND
– Were working in the UK.
Provided that you satisfied all of these tests and that your (former) employer had passed its staging date, you should have been put into a pension.
Steve Webb: Find out how to ask the former Pensions Minister a question about your retirement savings in the box below
In terms of your options now, the first port of call would be to contact your former employer.
You should point out that you had a legal duty to be enrolled and say that you expect them to set up a pension for you and to make the contributions that they should have made while you were employed by them.
In theory you could also ask them to compensate you for the investment growth which you would have enjoyed on that money in the period since 2015, though that would probably be quite an involved calculation.
If the firm fails to respond to your satisfaction you have a couple of options.
One would be to make a complaint to the Pensions Ombudsman on the basis that the firm has failed to administer its pension duties properly.
It has, of course, done more than this, but for your purposes a complaint of ‘maladministration’ may be an approach worth considering.
The Ombudsman would look into your complaint (though there could be a delay of several months before it can take your case on) and would be likely to contact the employer.
It may be that a more official communication from the employer could get them to respond even if they failed to respond directly to you.
Ultimately, the Ombudsman could rule that you had lost out due to their maladministration and could order them to make good the losses that you have suffered.
This could in principle include the loss of investment returns on the missing contributions, but this would be up to the Ombudsman to decide.
An alternative approach would be to contact the Pensions Regulator, whose job is to oversee compliance with automatic enrolment regulations. TPR has a special ‘whistleblowing’ process whereby people can report their employers for non-compliance and you can find the relevant webpage here.
My employer hasn’t put me in a pension scheme and I’m worried to report it
Steve Webb replies to a previous question from a reader who still worked for a rogue employer and was concerned they would lose their job if they turned whistleblower here.
It is presumably slightly easier for you to do this as you no longer work for the firm, but TPR do say that they seek to maintain confidentiality so this is a route which people can consider even if they do still work for the firm in question.
If you think that there were some of your fellow workers who may also have lost out, a report to the Pensions Regulator has the advantage that it may lead to corrective action being taken for all employees who had been affected, whereas an Ombudsman complaint would only benefit you personally.
Where a firm is found guilty of non-compliance they can face a one-off fine of £400 plus an escalating daily penalty of anything from £50 to £10,000.
TPR can also require your employer to pay the missing contributions. You *may* have to pay your share of the contributions that you would have paid, but in some cases TPR may require the employer to pay these as well as part of their enforcement action. You can read more about their approach here.
It is better to make a complaint to either the Ombudsman or TPR, not pursue both forms of redress in parallel. However, should you not get anywhere with the Ombudsman you could follow up with TPR afterwards.
Regrettably, your experiences are far from unique. Although the large majority of employers have complied with their duties, a significant number have not.
According to the latest statistics from the Pension Regulator, as at December 2021 over 166,000 fixed penalty notices had been issued as well as more than 93,000 unpaid contributions notices.
Given that the vast majority of employers do take on this legal duty to enrol their workers into a pension it is important that others do not gain a commercial advantage by seeking to avoid their responsibilities.
I hope that you will follow up in one or more of the ways I have suggested and I look forward to hearing the outcome.
Ask Steve Webb a pension question
Former Pensions Minister Steve Webb is This Is Money’s Agony Uncle.
He is ready to answer your questions, whether you are still saving, in the process of stopping work, or juggling your finances in retirement.
Steve left the Department of Work and Pensions after the May 2015 election. He is now a partner at actuary and consulting firm Lane Clark & Peacock.
If you would like to ask Steve a question about pensions, please email him at firstname.lastname@example.org.
Steve will do his best to reply to your message in a forthcoming column, but he won’t be able to answer everyone or correspond privately with readers. Nothing in his replies constitutes regulated financial advice. Published questions are sometimes edited for brevity or other reasons.
Please include a daytime contact number with your message – this will be kept confidential and not used for marketing purposes.
If Steve is unable to answer your question, you can also contact MoneyHelper, a Government-backed organisation which gives free assistance on pensions to the public. It can be found here and its number is 0800 011 3797.
Steve receives many questions about state pension forecasts and COPE – the Contracted Out Pension Equivalent. If you are writing to Steve on this topic, he responds to a typical reader question here. It includes links to Steve’s several earlier columns about state pension forecasts and contracting out, which might be helpful.
TOP SIPPS FOR DIY PENSION INVESTORS