On the go: The Pensions Ombudsman has ordered Bionica Systems to pay missing contributions of £2,311.86 into an employee’s scheme, and a further £1,000 for the ‘serious distress’ caused by the error.
“Mr S” complained to the ombudsman on April 9 2020 that his employer had failed to pay in contributions to his Nest pension scheme, despite deductions being made from his pay.
The missing pension contributions were for the period August 2018 to July 2020, and amounted to £2,311.86.
On lodging his complaint, Mr S produced payslips from Bionica Systems showing his pension contributions had been taken from his pay, and the additional employer contributions had also been made.
But Mr S said that neither his nor his employer’s contributions had gone into his Nest workplace pension scheme.
On September 17 2020, Bionica Systems confirmed to Mr S that his contributions had not been paid to Nest. The employer also failed to produce any evidence that the contributions had been paid to Aviva, the selected scheme administrator.
The Pensions Ombudsman asked Bionica for its response to Mr S’s complaint on August 22 2022, chasing again on September 5, but the employer failed to respond in time for the deadline.
In the view of the caseworker from the ombudsman’s office assigned to Mr S’s case, Mr S’s evidence was true and accurate. Bionica Systems failed to provide any alternative points of view.
The caseworker and the ombudsman also judged that Mr S had suffered severe distress and inconvenience due to the employer’s maladministration, as well as its failure to respond to the subsequent ombudsman office investigation.
As a result, the ombudsman ruled that Bionica should pay Mr S £1,000 for non-financial injustice within 28 days.
Bionica must also pay the missing contributions to Mr S’s pension scheme, first drawing up a clear schedule of the missed payments within 14 days of a request by Mr S.
As part of this process the employer must establish with Nest whether the late payment of contributions has meant fewer units were purchased in Mr S’s account than he would have otherwise secured, had the contributions been paid on time.
Bionica must pay any reasonable administration fee Aviva may charge for carrying out the above calculation.
Within 14 days of receiving confirmation from Nest of any shortfall in Mr S’s units, Bionica must pay the cost of purchasing any additional units required to make up the shortfall.
