What is automatic enrolment?
The Government has introduced auto enrolment to help more people save for their future. This means that employers will have to automatically enrol some workers into a workplace pension plan and give other workers the option to join.
Both the employer and employee will have to contribute to the scheme.
Here we will explain what this means for both employers and employees. Employees will have to make the decision whether to join the scheme or not.
This affects everyone - from the Director to the cleaner, full time or part time. If you are paid a wage then you will be affected!
When it's happening?
The largest employers started first in October 2012. Between 1st June 2015 and1st April 2017 companies with fewer than 50 employees will have to set up a pension scheme. Your employer will be notified when they have to put a scheme in place. This is called The Staging Date.
Employers must assess their workforce to determine which types of worker they employ. Workers can be categorised as eligible jobholders, non-eligible jobholders or entitled workers. This will determine who is automatically enrolled in to the pension scheme and who has a right to join if they want.
Your employer must be responsible for the ongoing maintenance of the scheme and has an obligation to keep employees informed.
Do Employees opt in or out?
If you are automatically enrolled in to a pension scheme you have the right to opt out if you wish. This means that your employer does not have to contribute. However, every 3 years you will be automatically enrolled back in if you keep opting out.
If you are not automatically opted in to the scheme you have the right to join it. In certain circumstances your employer will also contribute.
The Pensions Regulator (TPR)
The employer duties are not optional. TPR will ensure that employers comply with their duties. Although TPR's approach will be to educate and encourage compliance, employers will face substantial fines or even imprisonment if they don't comply.
Auto Enrolment Service
Auto Enrolment can be complex for employers and the administration can be onerous.
At HRC Group we can help employers to implement a scheme for their workforce.
To put a scheme in place is not an overnight job. It requires planning and time to make sure it is set up correctly.
We can help employers identify their Staging Date, identify who is to be automatically enrolled in the scheme and who is entitled to join.
The biggest issue for employers will be to keep on top of the administration. The Pensions Regulator has the power to issue fines for poor administration. We can help in this area.
We are offering a consultation at our expense to understand your requirements and offer guidance..
Useful website where both employers and employees can get more information:
The Pensions Regulator