Over 60% of employers in our automatic enrolment review sample had unseen compliance risks. When was the last time you reviewed yours?
Automatic enrolment has been in place for over a decade, yet compliance can still present challenges for many UK employers.
While auto-enrolment may appear straightforward on the surface, our analysis of 100 automatic enrolment reviews we carried out found that more than 60% of employers had unseen compliance risks within their workplace pension arrangements. Two common factors among employers who were not fully compliant were that they were unaware of the issues and assumed they were acting within the rules.
These issues can often go unnoticed for extended periods. When they are eventually identified, potentially following contact from The Pensions Regulator (TPR) or queries raised by employees, they may result in financial penalties, additional administrative effort, and reputational damage. For employers and HR professionals, taking a fresh look at their automatic enrolment obligations is therefore increasingly important.
This article explores the most common auto enrolment errors, why it matters, and how employers can gain clarity on whether they are meeting their legal duties.
Why automatic enrolment processes can require review
Automatic enrolment (also referred to as AE) places specific employer responsibilities on organisations operating a workplace pension. These responsibilities include assessing workers correctly, enrolling eligible employees, managing opt-outs, maintaining accurate records, and paying pension contributions in line with legislation.
In practice In practice, compliance gaps do not typically arise from a single event. More often, they develop gradually. Changes in staffing, payroll systems, pension providers, advisers or internal responsibilities may introduce risk, particularly where processes are not reviewed on a regular basis.
Based on employer reviews carried out by Secondsight, areas that have required attention include:
Worker assessment accuracy
Employees assessed incorrectly against automatic enrolment thresholds, potentially leading to delayed or missed enrolment.
Contribution alignment
Pension contributions not aligned with qualifying earnings definitions or scheme rules.
Administration and systems
Reliance on manual or legacy processes, or process gaps following payroll or provider changes that have not been fully revalidated.
Accountability and governance
Unclear allocation of responsibility across HR, payroll and finance teams, incomplete documentation, or limited internal oversight.
Historic employee records
Errors effecting former employees that may become more complex to resolve over time. These issues can arise regardless of pension provider and are often linked to internal process controls rather than product selection.
Over time, if not identified, such matters may increase exposure to compliance risk and require additional resource to address.
Why compliance matters
When it comes to auto enrolment, employers will either be meeting their duties, or there will be parts of the process that need attention.
Many organisations only become aware of potential issues when:
- The Pensions Regulator makes contact
- Employees raise questions or concerns about their workplace pension
- An internal review or due diligence exercise highlights issues
At that stage, resolving problems can be time-consuming and, in some cases, costly, particularly where backdated contributions or former employees are involved. For HR teams, this can also place additional pressure on time and internal resources.
Gaining clarity on automatic enrolment obligations at an earlier stage can help reduce the likelihood of more complex issues developing over time.
Gaining clarity through our auto enrolment workshop
To support employers in navigating these challenges, Secondsight offers a practical in-person automatic enrolment workshop designed specifically for private sector employers and HR professionals.
In a focused 35-minute briefing, employers and HR professionals can explore:
- Case studies – Illustrative examples of process gaps identified during employer reviews.
- Risk identification – How to spot potential errors involving both current and former employees.
Practical steps – Considerations when reviewing administration and governance processes.
- Regulatory framework overview – A refresher on employer duties under the automatic enrolment regime.
The session also outlines approaches that employers are using to review their processes and consider whether their current arrangements remain appropriate.
Ultimately, the workshop is designed to help employers consider one key question:
Is your organisation compliant?
Please note:
This article is for general information only and does not constitute advice. All information is correct at the time of writing and is subject to change in the future.
