Pensions

UK pensions watchdog cracks down on firms changing corporate identity to evade pension duties

The Pensions Regulator (TPR) is investigating a potential trend of employers rebranding their business to try to dodge their workplace pension responsibilities

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 wilfully failing to comply with UK automatic enrolment laws.

TPR’s director of automatic enrolment, Darren Ryder said in a statement that some bosses might think that [by] changing the name of their company, they can avoid their duties but they should know they are on its radar. They 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 enrolment duties.

There is nothing wrong with genuine rebranding, said Ryder. But rebranding has no impact on the businesses’ automatic enrolment duties—they are still the same entity and TPR will take action against them if they try to deny their 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 TRP will visit businesses whoever they are, wherever they are, said Ryder. It will go anywhere across the country to inspect an employer—it has visited Northern Ireland, Scotland, Wales, and all parts of England in the last 12 months.

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