Payroll provider insolvent and unpaid pensions: can employee claim via NI Fund?

[BeBrightLikeAFuschia]

Does anyone know what happens in this situation please:
Company A (employer, as per contract) engages a payroll provider (Company B) to handle all payroll/PAYE/pension matters.

Company A makes payments to Company B each month that cover the salary, ERNI & Pension contributions of their employees.

Company B is responsible for ensuring wages are paid to employees, tax & NI are paid to HMRC and pension is paid to the pension provider.

If Company B becomes insolvent, and a number of months of pension payments have not been paid to the pension provider, can the employee claim this back through the National Insurance fund?
All guidance indicates that this is possible if the employer becomes insolvent, but in this instance Company A is the employer and is still trading.

No company A your employer is responsible for paying over the pension shortfall

Thank you.

And then they need to register a claim with the insolvency practitioner to get the money back from Company B?

It is up to them to join the list of creditors, but they are unlikely to retrieve the money.

But that is their problem not yours.

i work for an umbrella payroll company. B is classed as your employer as they process your pay B was responsible for making hmrc and pension payments however after a few dodgy umbrella payroll companies not making hmrc / pension payments the legislation has recently or is changing and it will be company A responsibility in future

The new legislation comes into effect 6th April making both companies A & B jointly responsible but prior to that it was the payroll company so B responsibility to make the payments.

@Spendysis Interesting about the new legislation!

But if there is a contract that states that A is the employer (and B has been engaged by A to carry out a service), is A still liable for making up the shortfall and then they have to sort it out as @Hedgehogforshort said? Employee has no dealings with B other than seeing that name on payslips & HMRC records.

Yes the OP clearly stated that her contract of employment was with A not B

Quite a lot of charities and small companies farm out payroll services.

The responses that implied B is the employer are mixing up agency regs with this situation, or subsidiary and parent companies trying to avoid employer obligations.

I agree with you.

Who does it say your employer is on government gateway op? And is it an recruitment agency or Eor that processes your pay they may have different rules we only deal with uk payroll

Our clients have a contract with their end client who they do the actual work for A for rate of pay hours notice period job description etc and a generic contract with us B holiday pay sick pay auto enrolment into a work place pension making statutory payments as this is legally our responsibility etc

so as b in this scenario we are classed as their employer do employment references A and B have their own contracts between them. A has sent B the money to cover statutory payments employer ni tax pension payments these are included in the money sent from A to be deducted and forwarded to HMRC and pension providers by b

currently B is responsible for these missing pension payments as they have received the money but not distributed it as they should reason i mentioned changes to legislation is because of payroll company’s not making payments the ones I’ve heard of haven’t been forwarding ni and tax and going bust which is why the legislation is changing in the new tax year making it the end client A joint responsibility for the payments so we are gaining new clients and losing some who are streamlining the number of payroll companies they work with

I believe you can report this to the pension regulator and claim the missing payments from the national insurance fund if your payroll company has gone bust

@Spendysis You are wrong in this case because she has an employment contract with A, who is therefore liable to pay the missing pension contributions.