Shoe company left footing £42,000 AE bill from TPR

Hannah Godfrey writes

High street footwear firm Johnsons Shoes Company has had to pay a £40,000 fine after failing to engage with its automatic enrolment (AE) duties.

The shoe firm was initially issued with a £400 fixed penalty notice from The Pensions Regulator (TPR) after it failed to comply with the law on the automatic enrolment of its staff into a workplace pension scheme.

This required checking whether its staff qualified to be put into a workplace pension scheme and confirming to TPR that it had done so.

Johnsons paid the £400 fine but still did not become compliant, TPR said in statement, adding: “Despite repeated reminders – and being warned it would face a new fine that would increase by £2,500 per day if it did not meet its responsibilities – the Shepperton-based business continued to flout the law.

“The fine reached £40,000 before the company finally became compliant. At that point, Johnsons refused to pay the fine – forcing TPR to take the business to court to secure payment.”

Eventually, the company agreed to pay the £40,000 fine and £2,000 court costs, preventing the need for a full court hearing on the matter.

TPR executive director of automatic enrolment Charles Counsell (pictured) said: “The failure by Johnsons to act, despite our repeated warnings, left it with a completely unnecessary bill that was more than 100 times the amount it was originally fined.

“The vast majority of employers meet their automatic-enrolment responsibilities. We will use all the powers available to us against the minority who choose to ignore their duties.”

He added: “Our message is clear: fail to comply with the law and you will be fined. Fail to pay your fine and we may take you to court.”

The latest figures from TPR showed 503,178 employers are set up for auto-enrolment, but almost twice as many have yet to meet their responsibilities. A study published by the Department for Work and Pensions in December 2016 estimated there would be an extra £17bn of workplace pension savings per year in the UK as a result of automatic enrolment by 2019/20.