What is Pension Auto Enrolment?
All employers are now required by law to automatically enrol their staff ito a Qualifying Workplace Pension Scheme. The largest employers have already begun to meet their legal obligations and all firms will gradually need to follow suit over the coming months.
The value of pensions and the income they produce can fall as well as rise. You may get back less than you invested.
The Financial Conduct Authority does not regulate on Automatic Enrolment.
Depending on the size of the employed workforce, there will be a compulsory deadline for employers to adhere to.
The Pensions Regulator will be regulating these changes and deferring these obligations is not an option. If not met, the penalties will be enforced and will be painful!
Who in the business is affected?
Pension Auto Enrolment requires employers to automatically enrol any eligible jobholders into a pension scheme depending on their specific staging date. Eligible jobholders are employees aged between 22 and the State Pension Age who earn in excess of £8,105 per annum (currently). These people need to be automatically enrolled into a qualifying scheme. Further non-eligible jobholders can also opt to join the scheme.
This affects everyone who employs staff, even if the company only has 1 employee!
What are the employers main responsibilities?
The business will have increased financial and administrative responsibilities.
- Firstly, employers will need to register with the Pensions Regulator.
- Employers will either need to offer a qualifying scheme that has been setup with a pension provider, or use the Government-run NEST scheme.
- Employers will need to be able to deduct employee contributions directly from their pay and pass these contributions onto the pension provider.
- Employers are required by law to communicate the changes to all employees in writing and explain what automatic enrolment means for them
- Employers will need to keep and maintain adequate records about employees and the scheme
How can we help?
If you are an employer, now is the time to start making preparations for these changes, as they are likely to have a financial and administrative impact on your business.
From our experience, it has taken between 4-6 months to implement. Although the payment date can be left until your specific staging date (if you choose), you will still need to plan ahead.
To help guide you through your obligations, responsibilities, and the options available to you, one of our pension auto enrolment specialists will be happy to provide you with professional independent advice.
Call us today for FREE on 08000 271 300 to find out more about pension auto enrolment
Auto enrolment is not regulated by the FCA.