Pensions auto-enrolment undermines Government’s promise to cut red tape, lawyer claims

Pensions auto-enrolment will add “another layer of red tape and bureaucracy” for employers, breaking the Government’s promise to reduce the burden of red tape on businesses, an employment lawyer has claimed.

Daniel Barnett, barrister at Outer Temple Chambers, made the comments in response to a survey that found that pension auto-enrolment was the top concern for employers and HR professionals for the year ahead.

One-third (33%) of the 1,400 people surveyed by Barnett for the HR Professionals Survey 2012 said that the introduction of pensions auto-enrolment would be their biggest challenge this year.

Once pensions auto-enrolment comes into force, employers will have to automatically enrol eligible employees into qualifying workplace pension schemes and make mandatory employer contributions.

The date on which employers will have to begin auto-enrolment will depend on their PAYE scheme size, with the largest employers having to auto-enrol employees from 1 October 2012.

Barnett commented: “The complexity and expense of auto-enrolment seems to have left employers confused and uncomfortable about what seems very much like another layer of red tape and bureaucracy.

“In trying to shift the cost of providing for the elderly onto the private sector, the Government seems to have broken its promise to reduce the red tape burden on businesses. As is so often the case, small and medium businesses will suffer most.”

The survey also found that more than a quarter (28%) of HR professionals would like to see the Agency Workers Regulations scrapped and a quarter (26%) want the Transfer of Undertakings (Protection of Employment) Regulations (TUPE) to be abolished.

However, employers were largely positive about the upcoming reforms to the employment tribunal system, which include the introduction of fees for employees bringing tribunal claims and an increase in the qualifying period for unfair dismissal, with 56% believing that it will reduce the number of claims.

View all the latest news and advice on pensions auto-enrolment in our employer’s guide.