Recruitment company faces prosecution for ‘meddling’ with auto-enrolment

In the first known prosecution of its kind, a national recruitment company accused of illegally ‘meddling’ with its workplace pensions scheme is facing legal action at the hands of The Pensions Regulator (TPR).

According to reports, Derbyshire-based Workchain and a number of its Directors are facing prosecution after having opted employees out of the company’s auto-enrolment pension scheme illegally by using personal data to access individual online pension accounts.

Directors Phil Tong and Adam Hinkley, along with a further five senior members of staff, allegedly terminated employees’ pension scheme memberships in this way.

As a result of their actions, they have been charged with unauthorised access to a computer programme, contrary to section 1(1) of the Computer Misuse Act 1990, and are due to appear at Derby Magistrates’ Court on 7 June 2018.

TPR has said that the Directors’ actions were in direct violation of auto-enrolment regulations – which stipulate that employees who wish to opt out of a workplace pension scheme must do so themselves.

To date, the regulator has served some 79,879 compliance notices to employers who have failed in their auto-enrolment duties – on top of more than 32,000 fixed penalty notices (FPNs).

Many businesses have also been taken to Court over auto-enrolment failings, but this case marks the first time TPR has launched prosecutions for this particular offence.

In a warning to other businesses, the media has been keen to point out that Workchain’s Directors could potentially face a maximum sentence of six months’ imprisonment as a result of their actions.