Auto enrolment

Auto-enrolment is set to be one of the most - perhaps the most - significant changes to the nature of pension provision in the UK.

From October 2012, employers will gradually be required to enroll employees earning over a set threshold into an auto-enrolment-compliant pension scheme.

Only the very largest employers will be subject to the auto-enrolment requirements from 2012. The period for all other employers, including those with only one or two employees, will run until September 2016.

The date from which employers will be obliged to comply with the auto-enrolment requirements is known as their 'staging date'. Even if your staging date is some time away, it is not too soon to start making plans.

The effect of auto-enrolment is that all employers and employees will have to pay contributions into a qualifying pension scheme that complies with the auto-enrolment requirements. Contributions will be based on upper and lower, and upper thresholds.

Although employees will be able to opt-out of the auto-enrolment scheme if they wish, any who do so will have to periodically re-enroll.

The compliance burden for auto-enrolment is significant. We can review your existing pension scheme to see whether it meets the auto-enrolment requirements, particularly around the benefit structure and the pensionable pay provisions.

We can also help you assess your workforce and which categories of employee are subject to the auto-enrolment regime. Auto-enrolment will require input from HR together with payroll and administration. We will work with your other advisers and service providers to ensure you have a joined-up approach to the new pensions auto-enrolment requirements.