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Original poster

DH has been an idiot re pension

42 replies

sillybillydh · 21/02/2025 00:33

My DH is 55 and is usually great with money.
For most of his career he's been a contractor, with a few short spells working for large corporations. He's got a private pension and a smallish occupational pension. We're mortgage free and have a very healthy amount of savings, the lions share coming from him (though is shared between us)
He's been working for a teeny tiny firm for the last three-ish years. I doesn't pay particularly well (under 50k) but it's low stress and permanent WFH with lots of flexibility.

I asked him a few months ago about the pension with the job. He didn't know. Erm, what? Turns out he'd never seen a payslip. I was gobsmacked. He said his salary went into his account every month so he didn't really sorry about it.
I told him his employer legally had to sign him up to the workplace pension scheme. Initially he said that he didn't want to "rock the boat". He was really pleased when landed this job as his skills are pretty niche and becoming obsolete. I said don't be ridiculous, you're an employee on PAYE, you have rights.
He's finally chased it up, turns out his employer has NOT been paying in but has told DH he's just set it up. So now he's in the process of trying to make sure his employer backdates the payments, DH also needs to pay in. It's just such a mess.
It's a one man show basically so no HR.
I just can't get my head around how my normally so financially sensible DH has ended up on this situation. I'm also worried, only because DH has planted the seed, that he's going to get sacked. Which is ridiculous.
Please tell me this will be ok?!

OP posts:
theboffinsarecoming · 21/02/2025 00:58

My immediate thought would be that if he has never seen a payslip, how can he even be sure that his employer is deducting his tax and NI correctly, and passing that (and the employer's NI contribution) to HMRC? Have they been providing him with a P60 each year?

If they have been this lax with the workplace pension, they might not be doing tax and NI properly either, and that could open up a far worse can of worms.

CombatBarbie · 21/02/2025 00:59

I'm not an expert of pensions, only basic knowledge but DH would have had to opt out at the time of starting. Who does the payroll? It should have been picked up. And should be backdated. Where are his payslips? Legally he has to be given one too!

I think if they sacked him, he'd have grounds to take it to a tribunal.

madamweb · 21/02/2025 01:03

I don't understand how he has never seen a payslip?

ReadingSoManyThreads · 21/02/2025 01:32

madamweb · 21/02/2025 01:03

I don't understand how he has never seen a payslip?

It happens. Happened to me in a job, then I found out that was illegal, so asked for them...that uncovered a whole can of worm (owner had been diddling figures and underpaying me by quite a lot).

Original poster
sillybillydh · 21/02/2025 09:12

Sorry I should have said he's seen his payslips now and the tax and NI are as they should be. All seems fine, apart from the pension.

The whole thing boggles my mind. I'm awful with money / finances and he's the opposite, usually!

OP posts:
Original poster
sillybillydh · 21/02/2025 09:14

CombatBarbie · 21/02/2025 00:59

I'm not an expert of pensions, only basic knowledge but DH would have had to opt out at the time of starting. Who does the payroll? It should have been picked up. And should be backdated. Where are his payslips? Legally he has to be given one too!

I think if they sacked him, he'd have grounds to take it to a tribunal.

Re tribunal that's what I've said too. He's been employed long enough that he has legal rights. He's bloody good at his job, too.

OP posts:
ByQuaintAzureWasp · 21/02/2025 09:41

Tax and NI will have been overpaid as his pension should come out first ...

Bankholidayhelp · 21/02/2025 10:31

Has he got his p60s then as well?

Original poster
sillybillydh · 21/02/2025 10:41

ByQuaintAzureWasp · 21/02/2025 09:41

Tax and NI will have been overpaid as his pension should come out first ...

Well quite. It's a fucking shit show.

OP posts:
WhatTheFudges · 21/02/2025 10:46

Tbh I imagine he will be let go now. They won’t say it’s because of this due to legal reasons, but that will be why.

I understand not getting the pension is wrong but in my 50’s I would be happy to sub that for a WFH job with less stress, especially being as you said you have good savings anyway. Can’t imagine the “one man band” spending money and time on getting this right for one person, surly they will just let him go.

OneWaryCat · 21/02/2025 10:50

WhatTheFudges · 21/02/2025 10:46

Tbh I imagine he will be let go now. They won’t say it’s because of this due to legal reasons, but that will be why.

I understand not getting the pension is wrong but in my 50’s I would be happy to sub that for a WFH job with less stress, especially being as you said you have good savings anyway. Can’t imagine the “one man band” spending money and time on getting this right for one person, surly they will just let him go.

This is such rubbish. OP has said he is a good worker who has been with the company for 3 years. Besides, all hell would break loose if they fired him for asking a legitimate question about his pension. He could take them to the cleaners.

MissHollysDolly · 21/02/2025 10:51

If your DH pension isn't being paid, other employees won't be either. I should imagine that the best course of action would be to get the employer to sign a compromise agreement so he can leave with a payout in return for not saying anything.

ErrolTheDragon · 21/02/2025 11:02

'Letting someone go' at this stage and rehiring would be costly and risky for the employer. A replacement will likely not be as good, and might even cost more.

My guess it was an oversight by someone not particularly au fait with employment regulations. Given your DH didn't bring it up at the start himself I can believe this is just down to incompetence. Sounds like it's being sorted out now.

ErrolTheDragon · 21/02/2025 11:06

If he's not already in a union he might want to join one. No idea which would be appropriate but this looks like where to start looking.

www.tuc.org.uk/joinunion

Samsonshairdresser · 21/02/2025 11:06

This is surprisingly common. Options are: employer pays for an actuary/specialist accountant to sort out the mess or he contacts ACAS

Does he have a contract? What does it say in that? If no contract (again, depressingly common), straight to ACAS for advice.

You can contact ACAS for advice without committing yourself to legal action

Original poster
sillybillydh · 21/02/2025 11:13

WhatTheFudges · 21/02/2025 10:46

Tbh I imagine he will be let go now. They won’t say it’s because of this due to legal reasons, but that will be why.

I understand not getting the pension is wrong but in my 50’s I would be happy to sub that for a WFH job with less stress, especially being as you said you have good savings anyway. Can’t imagine the “one man band” spending money and time on getting this right for one person, surly they will just let him go.

But what will the reason for letting him go? He's got rights. He's not doing some cash in hand job, he's a formal employee.

OP posts:
Original poster
sillybillydh · 21/02/2025 11:15

ErrolTheDragon · 21/02/2025 11:02

'Letting someone go' at this stage and rehiring would be costly and risky for the employer. A replacement will likely not be as good, and might even cost more.

My guess it was an oversight by someone not particularly au fait with employment regulations. Given your DH didn't bring it up at the start himself I can believe this is just down to incompetence. Sounds like it's being sorted out now.

I think this is likely the case. I don't think it was done deliberately.

OP posts:
Mangolover123 · 21/02/2025 11:25

I think your reaction is over the top. Yes, it is not ideal but it is only 3 years out of 35 years, so not disastrous and frankly if the firms pays 3% and your husband pays 3%, he has missed out on £9k. Looks like they are going to put it right and hopefully back date it. So maybe a bit of interest lost.

snowpony · 21/02/2025 11:30

if he can convince his employer to pay the 3 years (he could speak to ACAS) then I don’t think this is quite the lost cost it seems as you can pay up to 3 years worth of pension www.gov.uk/guidance/check-if-you-have-unused-annual-allowances-on-your-pension-savings

EmeraldsandRubies · 21/02/2025 11:32

Don't panic.

All will be well.

It can be fixed and I doubt they will fire him over it. It could also form part of a tax free settlement if they do decide to restructure.

Any business can decide they don't need the role anymore and restructure. Many are doing this with costs of employment going up and more EE rights from Day 1. SME's struggle with all the requirements of employing people and this may spook him.

JustMyView13 · 21/02/2025 11:35

I don’t think he (DH) has anything to backdate.
If they have no pension plan in place they are in breach of their requirements under the Pensions Act 2008 which requires employers to put certain staff into a workplace pension and pay into it.
The rates have changed since 2008, but not in the last 3 years. The rate is 8% of which 3% must come from the employer. In the absence of them having established a scheme previously, I would suggest they need to backdate 8% of pensionable pay (defined for AE compliance). They can apply postponement for the first 3 months.
They will also need to establish an AE compliant scheme, communicate to employees and automatically enrol them into it. They cannot actively encourage people to opt out, and must re-enrol every 3 years. I’d say if going forward they would like to run a 3%:5% structure that’s ok. But they have a massive compliance issue on their hands.
Also, they should be applying an uplift to the contribution they pay into the plan to account for lost investment growth. They really ought to get professional advice. There’s plenty of cheap for employer schemes out there. And also - why isn’t their accountant flagging this.

Edit: to clarify DH

ExpressCheckout · 21/02/2025 11:36

He's got a private pension and a smallish occupational pension. We're mortgage free and have a very healthy amount of savings

All will be OK. Yes it's a nuisance, but in the greater scheme of things it's not a major problem, and you will ultimately benefit from his 'lions share' contribution in any case. He will just need to make sure that HMRC also make relevant adjustments in due course. But again this will all come out in the wash and personally I wouldn't be getting annoyed at this.

JustMyView13 · 21/02/2025 11:39

snowpony · 21/02/2025 11:30

if he can convince his employer to pay the 3 years (he could speak to ACAS) then I don’t think this is quite the lost cost it seems as you can pay up to 3 years worth of pension www.gov.uk/guidance/check-if-you-have-unused-annual-allowances-on-your-pension-savings

You’re right re roll forward of historical annual allowance. That side of it is no big deal.

There’s no convincing the employer, it’s a legal requirement. They either resolve this under the radar or OP DH can report the breach to the regulator. It will be seen as material and the ER would likely get a fine on top. Ignorance isn’t a defence.

nightmarepickle2025 · 21/02/2025 11:46

The employer minimum contribution of 3% will amount to £4500 for three years so not really worth going through the bother of firing someone over.

Bjorkdidit · 21/02/2025 11:53

ByQuaintAzureWasp · 21/02/2025 09:41

Tax and NI will have been overpaid as his pension should come out first ...

Indeed. The correct thing to do would be to recalculate and reissue his payslips and calculate an adjustment to account for DHs unpaid pension contributions (assuming he starts a new pension with their scheme, he owes them 3 years worth of contributions).

However, they should compensate him for the inconvenience and the missed investment growth, which will be reasonably easy to work out with a spreadsheet and analysis of the performance of the company pension fund over the past 3 years to determine the price of the fund each month and time invested for each contribution.

If it was me, I think I'd spend the weekend putting together a spreadsheet to come up with a figure that worked in my favour and put it to them to sort the matter out without them having to pay the appropriate specialist to do it for them.