What is auto-enrolment?It’s called this because all eligible employees will automatically become members of a qualifying pension scheme. Auto-enrolment aims to accustom employers and employees to progressively make higher levels of pension contributions in order to improve living standards at retirement. If you are an employer in the UK, you have a major role to play.
What does it mean for employers?If you own or run an organisation, whether commercial, charitable or voluntary, you'll have to make sure your approach to pensions meets the new legislation.
- If your organisation already has a pension scheme, you will need to speak to your Financial Adviser or pension provider to see if this meets the new government legislation, you may need to make changes your scheme or payment.
- If your organisation doesn't have a pension scheme yet, you'll need to set one up.
- Seek professional help and advice - Financial Advisers at Gaeia can steer you through this potential minefield, as the process is unfortunately more complicated than many employers realise.
- Consider using one of the Government initiated schemes such as NEST or The People’s Pension as your scheme (see below), or an alternative provider.
- Nominate a person within your organisation who will be responsible for auto-enrolment and communication with the Pensions Regulator.
- Find out the implementation deadline for your category of employer – called “Staging Date”. This will depend upon the size of your organisation.
- Assess your workforce against auto-enrolment eligibility criteria (age, employment status etc).
- Start reviewing your pension arrangements well before your staging date.
- Streamline your payroll, HR and finance arrangements.
- Communicate the changes to all your employees
- Automatically enrol eligible employees into a qualifying pension scheme
- Register with The Pensions Regulator and keep records
- Make a monthly contribution to your employees’ pensions