What is Auto Enrolment?
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The law on workplace pensions has changed; all businesses in the UK with more than 1 staff member must take part in Auto-Enrolment. It is being phased in and if you are a small employer this year is the time to start looking at workplace pensions for your employees. But what exactly is Auto Enrolment?

Auto Enrolment is a new scheme that makes it compulsory for companies to automatically enrol their employees into a company pension scheme.

It’s called automatic enrolment because it is automatic for staff; they are enrolled in the company pension scheme simply because they are employed by the business and the employer must pay into the scheme for them.

What is auto-enrolment?

Auto Enrolment is the process by which your eligible staff are enrolled automatically into a workplace pension plan. They will be eligible if:

  • they earn over £10,000 per year
  • they are over the age of 22
  • they are younger than state pension age

This process is being rolled out across the UK based on company size. Companies with over 30 employees have largely been enrolled already, and from now until mid-2017 it’s the turn for businesses with less than 30 staff.

When is my staging date?

Your company will have what’s called a ‘staging date’, which is given to you based on your PAYE number. This is the date on which all of your eligible staff will be enrolled into your pension scheme, so you’ll need to have prepared everything by this date. You can find out when this is on the Pensions Regulator’s website here.

What do I need to contribute?

When you’ve enrolled your staff, you will need to pay a minimum contribution of 1% gross pay in 2016, which will increase to at least 3% by 2018. Your staff will also contribute too.

These are the very basic elements of Auto Enrolment. If you want to find out more about workplace pensions, and the process you need to go through, take a look at our Auto Enrolment checklist, which includes more links to important information.

Should you need any more help with managing your HR, take a look at our HR service, or call us today on 0333 014 3888.


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