The value of pensions and the income they produce can fall as well as rise. You may get back less than you invested.
The Pensions Act 2008 introduced major reforms to Workplace Pensions. Under these reforms all employers must offer a qualifying workplace pension scheme to their workers and all eligible workers must be automatically enroled in the scheme.
The employer duties started being introduced in stages from October 2012. The date employer duties first 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.
What is the effect on my Workforce?
You'll need to assess your workforce to determine whether they're treated as a 'worker'. There are three different categories of worker, determined by their age and how much they earn.
What are my employer duties?
Your employer duties will depend on the types of worker you employ. You'll need to automatically enroll 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.
What is the effect on pension schemes?
You must register that you have an auto enrolment scheme in place with The Pensions Regulator (TPR) by at least five months after your staging date. You'll also have to re-register every three years. The good news is, if you have an existing pension scheme, you can use this to meet your employer duties as long as it meets certain criteria.
What happens if I do nothing?
The employer duties are not optional. TPR will be responsible for ensuring that you comply with your employer duties. Although TPR's approach will be to educate and encourage compliance, you'll face substantial fines or even imprisonment if you don't comply.
When is my staging date?
TPR will tell you when your staging date is at least twelve months in advance. They'll also send you a reminder three months before your staging date. You can choose to bring your staging date forward to coincide with other key company dates such as your end of year accounting. You'll have to contact TPR in writing to confirm the new staging date you've chosen. This should be done at least one calendar month before the new chosen staging date.
How can we help?
Here at we can help guide you through the complexities of Auto Enrolment, ensuring that you have the right advice and project management resource to comply with the new workplace pension legislation.