The Regulator has issued its first report on certain employer automatic enrolment failures and the action it took as a result of these. The employer in question (Dunelm Soft Furnishings Ltd ('Dunelm')) was required to auto enrol from 1 April 2013 and did not complete the registration process confirming its compliance with its auto enrolment duties by its target date of 31 July 2013. Despite being contacted and given several opportunities to register or explain any outstanding issues, Dunelm did not register until the Regulator served a notice under section 35 of the Pensions Act 2008, requiring it to do so.
Following the registration, the Regulator became aware of information which suggested that Dunelm had not complied with its auto enrolment duties and that there may have been breaches of the auto enrolment legislation, and so it conducted a statutory inspection of Dunelm's head office premises and found a number of auto enrolment failures – including a failure to enrol members of the four weekly payroll on time. These members were being automatically enrolled a month late. The Regulator also said that it was evident that these issues existed prior to Dunelm's registration so the information given as part of that registration was wrong, and that internal governance for ensuring the proper completion of the process had failed. Due to the significant contributions that were outstanding and to protect member benefits, the Regulator also served an unpaid contributions notice pursuant to section 37 of the Pensions Act 2008 directing Dunelm to pay over the contributions.
However, the report suggests that Dunelm then openly discussed its auto enrolment difficulties with the Regulator and during and after the statutory inspection worked collaboratively with the Regulator and its third party partners who supplied payroll and pension services so that the Regulator was able to obtain a full understanding of the issues and assist in resolving difficulties to ensure that Dunelm became compliant as soon as possible. The report also says that 'throughout this period Dunelm was open, forthcoming and fully co-operative with the Regulator in their endeavour to meet their employer duties.'
Corrective action was taken both in relation to paying the outstanding contributions and the general auto enrolment issues which were identified and the report confirms that Dunelm is now fully compliant. It would seem that Dunelm's co-operative and open attitude served to resolve issues with the Regulator and it is notable that despite there having been a number of auto enrolment failings, there is no reference to the Regulator imposing a financial penalty on Dunelm for non-compliance.