Need advice about auto-enrolment?
Please call David Stonefield on 0161 718 8215 or 07879 882277
Auto-enrolment is the term for the law that requires all employers to register their employees into a qualifying workplace pension scheme. This requirement is being rolled-out to the largest employers first and will eventually apply to the smallest employers from June 2015 onwards.
For example if you have 62 to 89 employees you have to apply auto-enrolment from 1 July 2014. Those with larger payrolls should already have auto-enrolment in place.
There are let-outs; auto-enrolment only applies to employees working in the UK who are aged 22 to state pension age, and who earn more than the personal allowance (£10,000 for 2014/15). After being enrolled into a pension scheme, each employee has an opt-out period of one month whereby they can receive a full refund of any contributions already made. Another opt-out opportunity must be offered every three years.
Once the workplace pension scheme is running, both the employee and the employer must make contributions, which will start at 1% of qualifying earnings rising to a total of 8%. Qualifying earnings consist of pensionable pay in the range £5,772 to £41,865 (for 2014/15). The employee's employment contract will define what "pensionable pay" is.
We can help you work out what auto-enrolment may cost you, and which employees will be covered. There is a lot to think about, and if you don't already have a suitable pension scheme in place you will need to set one up. There are significant penalties for employers who fail to enrol employees on time, so don't let the auto-enrolment timetable overtake you.
Please download the Auto-Enrolment guide below which provides an overview of the reforms, as well as information and advice to help employers to prepare for the new regulations.