Auto Enrolment

The law on workplace pensions has now changed to ensure that more people are saving for their retirement. If you are a UK employer then this will affect you and you will need to take early actions in order to prepare for it.

You will receive a letter from The Pensions Regulator (TPR) one year in advance of your staging date. This letter will not only notify you of your staging date but will also outline basic information about your employer duties, However, it pays to be aware of these changes as soon as possible so that you can establish, and put in place, procedures that will help you better cope. To be proactive, therefore, you can find out your staging date prior to receiving your letter by entering your PAYE reference code here.

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

Before your staging date

  • Review any current pension scheme you have in place to determine how they compare to these new requirements and what changes you will therefore 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 in to 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 email 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.

Failure to comply

As with most legislation there will be penalties for the employers who fail to comply. Whilst you may feel that Auto Enrolment is something which you can ignore for now, do remember that there is a large amount of work you need to do before your staging date. It is, therefore, important to start planning early which will also help you to mitigate the costs and minimise the disruption to your business.

Further information can be obtained from the Pension Regulator’s website here.

At McCabe Ford Williams we have been helping clients prepare for Auto Enrolment so please do contact us for more information or further advice.

Our offices also run a payroll service which is designed to be flexible for our clients, whether that be for initial help or to outsource your entire payroll function. For more details of our payroll service click here or alternatively, speak to your local MFW office.

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