Key facts about automatic enrolment
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We want to help you get a better understanding of automatic enrolment and prepare for the changes you'll have to make.
Here you'll find the key facts about automatic enrolment. We've split this into bite size chunks to make it easier to understand.
The new employer duties will be introduced in stages starting in October 2012. The date your duties apply is known as your staging date and it's based on the number of people in your largest Pay As You Earn (PAYE) scheme on 1 April 2012.
You'll need to assess your workforce to determine whether your employees are classified as a ‘worker' under the new legislation. There are three different categories of worker, determined by their age and how much they earn.
Your employer duties will depend on the types of worker you employ. You'll need to automatically enrol some workers into a pension scheme and arrange membership for others. You're also responsible for the ongoing maintenance of the scheme and have an obligation to keep certain records.
You must register that you have an automatic enrolment scheme in place with The Pensions Regulator (TPR) within four months of your staging date. You'll also have to re-register roughly every three years. If you have an existing scheme in place the good news is you can use it to meet your employer duties, so long as it meets certain criteria.
You'll need to keep records of how you've met and continue to meet your employer duties. This includes information about your workers and the pension scheme which must be provided to TPR when requested.
The new employer duties are not optional and TPR will be responsible for ensuring that you comply. Although their approach will be to educate and encourage compliance, you'll face substantial fines or even imprisonment if you don't comply.
You may have heard about NEST, the National Employment Savings Trust. NEST is a pension scheme that is primarily aimed at low to medium earners and small employers that don't have access to a company pension scheme.
Last update June 2012