Emso Consulting Limited v The Pensions Regulator

Background

1. EMSO Consulting Limited (the Employer) challenges a fixed penalty notice (the Penalty Notice) issued by the Pensions Regulator (the Regulator) on 8 May 2025 (Notice number 125676884708).

2. The Penalty Notice was issued under s 40 of the Pensions Act 2008 for failure to comply with a Compliance Notice issued on 12 March 2025.

3. The Regulator completed a review of the decision to impose the penalty notices and informed the Employer on 4 June 2025 that the Penalty Notice was confirmed. The Employer referred the matter to the Tribunal on 12 June 2025.

4. Both parties consented to the matter being determined without a hearing and I was satisfied that it was in the interest of justice to do so. The Law

5. The Pensions Act 2008 imposed a number of legal obligations on employers in relation to the automatic enrolment of certain ‘jobholders’ into occupational or workplace personal pension schemes. The Pensions Regulator has statutory responsibility for securing compliance with these obligations and may exercise certain enforcement powers.

6. Each employer is assigned a ‘staging date’ from which the timetable for performance of their obligations is set. The Employer’s Duties (Registration and Compliance) Regulations 2010 specify that an employer must provide certain specified information to the Regulator within five months of their staging date. This is known as a ‘Declaration of Compliance’. An employer is required to make a re-declaration of compliance every three years. Where this is not provided, the Regulator can issue a Compliance Notice and then a Fixed Penalty Notice for failure to comply with the Compliance Notice. The prescribed Fixed Penalty is £400.

7. Under s.44 of the 2008 Act , a person who has been issued with a Fixed Penalty Notice may make a reference to the Tribunal provided that a review has been carried out or an application for review has been made to the Regulator. The role of the Tribunal is to make its own decision on the appropriate action for the Regulator to take, considering the evidence before it.

8. The Tribunal may confirm, vary or revoke a penalty notice and when it reaches a decision, must remit the matter to the Regulator with such directions (if any) required to give effect to its decision. Evidence

9. I read and took account of a bundle of documents. The facts

10. The Employer’s duties start date was 1 September 2021. The re-declaration of compliance was therefore due on 31 January 2025, 3 years and 5 months after the start date.

11. The Employer’s re-declaration of compliance was not completed by the deadline of 31 January 2025. The Regulator sent a letter to the Employer’s registered office address dated 24 February 2025, which included in bold the information that ‘Urgent action is required – your re-declaration deadline was 31 January 2025’.

12. As no re-declaration was received, the Regulator issued a Compliance Notice on 12 March 2025 with a deadline of 22 April 2025. As this was not complied with, a Fixed Penalty Notice was issued on 8 May 2025 requiring the Employer to pay a penalty of £400. The Fixed Penalty Notice required the Employer to comply with the Compliance Notice by 5 June 2025.

13. The Employer completed the re-declaration of compliance on 21 May 2025.

14. On 3 June 2024 the Employer requested a review of the Fixed Penalty Notice, via their accountant. The accountant said that the Employer had not received the ‘reminder emails’ because they had inadvertently been forwarded to their spam folder. The accountant said that there was no intention to avoid their obligations, the Employer had a history of compliance and that the declaration was submitted as soon as the issue was identified. The Respondent upheld the penalty on review. Submissions

15. The Notice of Appeal relies on the following grounds: (i) The fine is disproportionate to the offence (ii) The Employer has a pension scheme and always complies with the requirements. (iii) The accountant and the Employer appreciate the need for compliance. (iv) A virtual office address was set up and post was forwarded by email. Unfortunately it went to a spam email folder by mistake. (v) The re-declaration was completed as soon as the Employer realised the error.

16. The Regulator’s response submits that: a. the amount of the fine is prescribed by legislation and is proportionate in the circumstances. b. the Employer is entitled to instruct third parties in the provision of postal services, but it remains the Employer’s responsibility to ensure that post delivered to their registered office address is received by them. The Employer’s failure to ensure suitable arrangements were made to receive post sent to their registered office address does not constitute a reasonable excuse for the failure to comply. c. the Notices were properly delivered to the registered office address and therefore received by the Employer Conclusions

17. The re-declaration of compliance is a central part of the Regulator’s compliance and enforcement approach. It is necessary so that the Regulator can ensure that employers are complying with their automatic enrolment duties, and this is why it is a mandatory part of the system. Employers are responsible for ensuring that these important duties are all complied with, and there needs to be a robust enforcement mechanism to support this system.

18. The amount of the Penalty Notice is fixed by statute and neither I nor the Regulator have the power to order a different amount, but for the above reasons I am in any event satisfied that the fine is proportionate.

19. The Regulator sent the Compliance Notice to the registered office address of the Employer. It was received at that address and accordingly it was received by the Employer as a corporate body, whether or not it then came to the attention of individuals working for the Employer. The Compliance Notice was accordingly properly served and, as a matter of law, received by the Employer at its registered office address.

20. The notice of appeal states that ‘a virtual office address was set up and unfortunately the post was forwarded by email but went to a spam folder. This was an innocent mistake and was rectified as soon as it was realised’.

21. No further details are provided. The notice of appeal does not specify which post went to the spam folder. It does not specify when this happened and for how long it lasted. It is not clear whether this happened for all post for a number of weeks, or months or longer, or whether it was a one off isolated incident. It is not clear if it included all communications from the Pensions Regulator or just some of those communications. Presumably it includes at least the Compliance Notice dated 12 March 2025, but it is not clear if it also includes the reminder letter dated 24 February 2025.

22. The Employer gave a slightly different explanation in the application for a review. In that application the Employer stated that ‘the reminder emails’ from the Regulator had been inadvertently forwarded into the spam folder of the email system. It is not clear to me whether that was intended to refer to the Compliance Notice that had been sent by post, but if so ‘reminder email’ is an odd phrase to use.

23. Without these details, and in the light of that lack of clarity, I am not persuaded that the Employer took reasonable steps to ensure that it had a reliable method of receiving communications sent to its registered office. The Employer remains responsible for ensuring that post received at the registered office comes to its attention within a reasonable period of time. I am not persuaded that the fact that some unspecified post, presumably including the Compliance Notice, went to the Employer spam email folder, amounts to a reasonable excuse for non-compliance.

24. Previous compliance does not excuse the current failure to comply, nor does the fact that the re-declaration of compliance was filed promptly when the mistake was realised.

25. For the above reasons I am satisfied that the Employer has not provided a reasonable excuse for not complying with the Compliance Notice. Given the importance of declaring and re-declaring compliance, I determine that issuing the Penalty Notice was the appropriate action to take in this case.

26. The reference is dismissed. Signed Date: Sophie Buckley 2 December 2025