Posted by admin - January 8, 2014 3:42 pm Auto-enrolment

The law on workplace pensions has now changed, to ensure that more people are saving for their retirement. If you are an employer with staff working for you in the UK then this change will affect
you, and there are things you will need to do in order to comply, and most probably sooner than you think. The date from which the new employer duties will apply to you is known as your staging date and this will be determined by how many employees formed part of your payroll as at April 2012.

You will receive a letter from The Pensions Regulator (TPR) one year in advance of your staging date which will notify you of your particular staging date and will also provide basic information about your employer duties. However, it pays to be aware of these changes now so that you can establish, and put procedures in place in good time.

Here are some of the things you will need to do before, on and after your staging date.

Before your staging date

  • Review any current pension scheme you have in place to determine how it compares to the new requirements and what changes you need to make.
  • Assess how your workforce will be structured on your staging date to determine what duties you will have for each type of worker.
  • Choose a pension scheme for workers who will be automatically enrolled and agree how this will be set up.
  • Choose a pension scheme for workers who will be given the option to join and agree how this will be set up.
  • Engage with your pension and payroll providers.
  • Communicate the changes to your workforce.

On your staging date

  • Tell your workforce about how automatic enrolment affects them.
  • Automatically enrol certain workers into your pension scheme.
  • Invite other types of worker to join your pension scheme.

After your staging date

  • You must register with TPR within four months of your staging date.
  • Maintain records to prove compliance with the employer duties.
  • Continue to automatically enrol certain workers into your pension scheme.
  • Run an opt in/joining process for other workers.
  • Ensure the correct contributions are deducted and paid into the pension scheme.
  • Manage opt outs, process refunds and re-enrol workers roughly every three years.
  • Monitor age and earnings regularly as workers can move between different categories.
  • E-register with TPR roughly every three years.

Failing to comply

As with most legislation, there will be penalties for those employers who fail to comply.

You may feel that for you auto enrolment is something you can ignore for now, but do remember that with the amount of work you will need to do before your staging date, it is important to start planning now. Planning early will also help you to mitigate the costs and minimise the disruption to your business.

For further details and information about what you should do next contact your local MFW office who will be pleased to help, or visit the TPR website.