Key Facts
- •Comserv Contracting & Commercial Ltd (Employer) failed to make pension contributions to Nest for its employees since Spring 2023 due to a cashflow crisis stemming from payment disputes on contracts.
- •The Pensions Regulator issued an Unpaid Contributions Notice (UCN), followed by a Fixed Penalty Notice (FPN) of £400 and an Escalating Penalty Notice (EPN) of £500 per day.
- •The Employer appealed, citing financial difficulties and employee awareness of the non-payment, requesting a review and affordable payment plan.
- •The Regulator rejected the FPN review as untimely and modified the EPN start date. The Regulator maintained the unpaid contributions remained outstanding and the situation was worsening.
- •The Employer provided no further communication after filing the appeal, continuing to prioritize other debts over pension contributions.
Legal Principles
The Pensions Regulator has a duty to ensure pension contributions are paid.
The Pensions Regulator's actions and the Tribunal's affirmation thereof.
The Regulator has discretion to delay the accrual period of the EPN, but this is influenced by the employer's payment prioritization and communication.
The Regulator's response to the appeal and the Tribunal's consideration.
Penalty notices issued under the relevant legislation are subject to review, but time limits may apply.
The Regulator's refusal of review of the FPN due to it being out of time.
Outcomes
The appeal was dismissed.
The Tribunal found no proper basis to disturb the issuance of the FPN and EPN. The Employer's approach of prioritizing other debts over pension contributions, coupled with a lack of communication, did not justify overturning the penalties.
The matter was remitted to the Regulator.
The Tribunal confirmed the penalty notices, and the Regulator retains discretion regarding any potential future delay of the EPN, contingent on the Employer's actions.