TPO reports firm to TPR for 'complete disregard' of AE duties

The Pensions Ombudsman (TPO) has upheld a failure to pay complaint against Teddy Bear Corner Ltd (Teddy), and reported the firm to The Pensions Regulator (TPR) for its “complete disregard of the auto-enrolment (AE) regulations”.

'Mrs R' complained that Teddy had failed to enrol her into the pension scheme despite deducting regular pension contributions from her pay.

The firm has been directed to pay all of the unpaid employer and employee contributions into Mrs R’s scheme pension and shall also pay an amount equal to the notional fund value, had the contributions been paid on time, to account for investment losses.

In addition to this, Teddy has also been ordered to pay Mrs R £2,000 for the “severe distress and inconvenience” caused to her.

Mrs R joined Teddy in February 2015, and was led to understand, by Teddy’s letter dated 3 August 2015, that she had been enrolled into the Nest auto enrolment scheme in August 2015.

However, upon leaving Teddy in August 2016, Mrs R received a refund of £84.67 for her pension contributions during her employment with Teddy.

After querying the refund, it was revealed that despite Mrs R’s payslips showing that her pension contributions were being deducted on a monthly basis, she was not a Nest Scheme member.

Nest were also able to confirm that none of the contributions deducted by Teddy had been paid to the scheme.

Mrs R was subsequently advised by The Pensions Advisory Service (TPAS) and TPR that the pension contributions should have been in the order of £300, including employer contributions.

As such, Mrs R wrote to Teddy for clarification around both her membership of the scheme and refund amount, but received no response.

Following further requests for clarification around the reasons for the refund of her contributions, Teddy wrote only to confirm that this had been refunded on the advice of its accounting software provider.

Mrs R later complained to TPO in July 2018, and, when no response was received from Teddy, the ombdusman issued guidance as to the appropriate steps that should be taken to put matters right.

However, Teddy responded in a letter dated 31 October 2018, which indicated its attempts to set up the scheme were proving to be problematic, stating that while it had now set up an account on Mrs Rs behalf, the payments were being returned to Teddy by Nest.

The ombudsman clarified though, that despite further requests, no evidence of Mrs R’s enrolment was offered by Teddy after this letter, with Mrs R also receiving no further communication from the firm.

In his decision, the ombudsman, Anthony Arter stated: "Despite multiple requests, Teddy has failed to provide a substantive response.

"It has also failed to respond to the adjudicator's opinion and has not remedied matters, as recommended by the adjudicator. This amounts to maladministration."

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