Whilst he works on his own, using contractors where needed, what he and thousands of others, didn't realise is that he was an employer.
He had a live in nanny for his young kids.
The Pensions Regulator states:
"What if I don't have any staff?
Automatic enrolment duties don’t apply when a company or individual are not considered an employer. You won’t have any duties if you meet one of the following criteria:
- you’re a sole director company, with no other staff
- your company has a number of directors, none of whom has an employment contract
- your company has a number of directors, only one of whom has an employment contract
- your company has ceased trading
- your company has gone into liquidation
- your company has been dissolved
Automatic enrolment will apply if more than one director has a contract of employment."
What they make no specific reference to is if you employ staff in your home! Your home may not be a business or a director, but you are still an employer, so still have to comply.
- Employ a house kepper - they're in!
- Employ a nanny - they're in!
- Employ a carer - they're in!
OK, so there are other criteria, such as over 22 years old or earn over £192 per week or £833 per month, but, importantly, for my friend, his legal obligations had never occurred to him. Checking further, I found out that there are even rules relating to 'partial employer duties'.
This is just another issue in the Auto Enrolment fiasco and adds to the list of people who will end up falling foul of the regulations, ending up having to pay fines.
Anyway, my friend was a member of Your Business Community, so I put him in contact with our Auto Enrolment experts and they sorted him out!