UK pensions watchdog The Pensions Regulator (TPR) said it is investigating a potential trend of employers trying to shirk their workplace pension duties by changing their corporate identity.
TPR said it has become aware of a number of employers that appear to have tried to conceal their failure to comply with the law by hiding behind a new name. Among the offenses that may have been committed are fraud, theft, and willfully failing to comply with UK automatic enrollment laws.
“Some bosses might think that [by] changing the name of their company, they can avoid their duties but they should know they are on our radar,” Darren Ryder, TPR’s director of automatic enrollment, said in a statement. “We are aware of the camouflage they are trying to use and will not be fooled by it.”
The regulator said its investigators are currently working with the Insolvency Service and other agencies to take action against offenders that try to use the ploy.
TPR said employers could be trying to hide their noncompliance with the law by opening new businesses, transferring their workforce across, and then dissolving the original businesses. By changing names, TPR said, those involved hope to avoid having to pay pension contributions. It also said its investigators are looking into whether rogue advisers could be suggesting to employers that they use the tactic to avoid their duties.
The regulator is currently carrying out short-notice inspections on employers across the UK that are suspected of breaching their automatic enrollment duties.
“There is nothing wrong with genuine rebranding,” said Ryder. “But rebranding has no impact on your automatic enrolment duties—you are still the same entity and we will take action against you if you try to deny your staff the pensions they are entitled to.”
TRP also said it will no longer limit its visits to negligent employers based on geographical location.
“The message to noncompliant employers is that we will visit you whoever you are, wherever you are,” said Ryder. “We will go anywhere across the country to inspect an employer—we’ve visited Northern Ireland, Scotland, Wales, and all parts of England in the last 12 months.”
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Tags: Corporate Pension, Pension, The Pensions Regulator, UK