Pensions are long term investments. You may get back less than you originally paid in because your capital is not guaranteed and charges may apply.
Do you still need to set up your workplace pension? Complete our auto-enrolment form, and we will put you in touch with a qualified broker to help.
If you have employees who previously opted out of your workplace pension, you must reassess them every three years following your staging date. Any eligible employees must be re-enrolled onto the scheme (for example, anyone who now earns over £10,000 or has reached age 22). Re-enrolled employees can again choose to opt out if they wish. Once this has been completed, you must write to the re-enrolled employees to tell them what is happening.
The second stage of re-enrolment is re-declaration. Once eligible employees have been re-enrolled onto the workplace pension, you must complete a re-declaration of compliance. This must be completed within five calendar months of the third anniversary of their staging date.
Your staging date is the date that the government and the pensions regulator said that your company must have had a compliant pension set up. Your staging date will vary depending on the company’s size, how many people the company employs, and when it first started paying its team through the PAYE system. You can re-enrol your eligible employees up to three calendar months on either side of the third anniversary of this date.
If, after assessment, the company finds it does not need to re-enrol any employees, only the re-declaration of compliance must be completed.
You will have already given every eligible employee details of the pension scheme and an opt-out notice to complete should they decide they do not want to pay into a pension.
All eligible employees have one month from joining the scheme to opt out and get their first pension contribution back (the opt-out period).
Employees who choose to opt out after this period will need to check the pension scheme rules to determine if they are entitled to a refund of contributions.
If any of your employees opt out within the first month of their auto-enrolment, they can ask to opt back in at any time.
You only need to accept their notice to opt in once in a 12-month period. This is to stop any employees from opting out and in several times a year.
You will have to pay into the pension scheme if they are:
Earn at least £520 per month or £120 per week (£6,240 per year).
Every new starter is assessed the same way you assessed your entire workforce before your staging date. Find out how to assess your employees for eligibility for auto-enrolment here.
Whether your new starter is eligible or not, you must still give them all of the information required for them to understand all the options available. This is still a legal requirement set out by The Pensions Regulator.
You can choose to postpone the registration of any new employee for up to three months, which gives you time if you wish for them to pass a probationary period before qualifying for your workplace pension scheme.
Suppose an employee becomes eligible for auto-enrolment into your workplace pension after your staging date. In that case, you should give them the information about auto-enrolment, although at this stage, they may have already opted in or asked to join your workplace pension.
The main difference now is that your payroll system will identify that they should be automatically enrolled on the three-year re-enrolment anniversary of your staging date.
If they are still eligible for automatic enrolment at this time, they will then have to opt out if they do not want to pay into the pension.
This might happen if you have an employee who goes from a full-time employment contract to a part-time contract.
If they were automatically enrolled, they would remain in the workplace pension.
When the re-enrolment date comes up, they will have to 'opt-in' to remain part of the pension scheme if they are still not eligible to be automatically enrolled.
If an employee leaves your company, you no longer need to contribute to their pension (this is a requirement for auto-enrolment).
You need to update your payroll software with the termination date and notify your pension provider that the exiting employee will no longer contribute to their pension.
The exiting employee is responsible for transferring their pension across to another provider through a new employer if they wish to.
The Pensions Regulator can fine you if you do not follow their guidelines by your staging date. This fine can start at £400 and escalate to £50,000 for larger organisations.