It was bound to happen sooner or later…a well known company getting into hot water for failings around automatic enrolment. The Pension Regulator has had to wrap the knuckles of a big firm to get it to comply. Smaller firms should note that although they prefer the carrot, the regulator has a big stick at its disposal too.

The Pensions Regulator has revealed that it issued an auto enrolment unpaid contributions notice of over £100,000 to Dunelm Soft Furnishings. The company, which has around 4,500 staff across 127 UK stores, failed to register with the Pensions Regulator ahead of its staging date deadline of 1st August 2013. They eventually registered two weeks later – but only after receiving a compliance notice from the regulator.

A subsequent inspection from the regulator found that the company failed to enrol members of their payroll on time. Some were enrolled a month late, whilst others were enrolled three months late. To compound the situation the regulator also found that the firm had not paid across a significant level of contributions.

The firm blamed the failings on payroll systems, departure of key personnel at critical points in the process and ‘data quality issues’. The regulator ordered the firm to pay £83,000 in unpaid auto enrolment contributions. Dunelm subsequently discovered that they actually owed more than £108,000 in unpaid contributions.

If this could happen at such a large firm it should make small businesses (and their owners) take note. Over 28,000 employers are set to reach their staging date before the end of 2014 and 46,300 employers will stage in 2015. But those numbers are just a ripple on the auto enrolment pond before the tsunami hits in 2016 and 2017. In 2016 an estimated 512,000 smaller businesses will reach their staging date and an additional 661,000 in 2017.

With such a huge wave of employers reaching their staging date in 2016 and 2017 early planning and preparation is essential. If you are a business owner – are you ready?