What is Workplace Pension Auto-Enrolment?
To help people save for retirement, employers have a legal requirement to auto-enrol their eligible employees into a workplace pension scheme.
Introduced by the Government in 2012, the legislation was first rolled out to large employers, followed by medium-sized, and then small employers. All new and existing employers should now auto-enrol their eligible employees unless they choose to opt out.
The contributions employers and employees must make each month has been increasing in phases, with the last increase having taken effect from 6 April 2019.
Employers must auto-enrol employees who:
- are aged between 22 and state pension age;
- earn more than £10k a year (2019/20); and
- ordinarily work in the UK.
Re-enrolling your employees?
You will need to re-enrol your eligible employees roughly every three years.
This means automatically re-enrolling those who previously opted out or left the Scheme. There are, however, exceptions. Employees who are leaving employment and those who have tax protection under an existing pension, for example, do not have to be auto-enrolled by their employer.
Your re-enrolment date can fall up to three months before or after the anniversary of your staging date.
Each employer is required to re-declare its compliance with the auto-enrolment regulations via a Government Gateway. This must be done within five months of the third anniversary of their staging date (or duties start date for new employers).