7 Key Auto Enrolment Duties for Employers

By 2018, all UK employers will be expected to have an Auto Enrolment scheme in place. This article covers 7 of the key duties that each employer must complete in order to comply with the rules.

1. Set up a suitable workplace pension scheme

The employer must ensure that there is a pension scheme in place and that it is able to facilitate the Auto Enrolment process. It is very easy for employers to fall into the trap of assuming that an existing pension scheme will be suitable, only to find out further down the line that the scheme is not as flexible as they thought.

2. Provide workers with information on pensions and Auto Enrolment

Employers must issue a number of different communications to each category of worker they employ. A detailed understanding of both the work and the statutory communications process is required to enable employers to issue the right communications to the right employees at the right time.

3. Automatically enroll all eligible jobholders into the pension scheme

Under the new rules there are 3 different categories of worker; Eligible Job Holder, Non-Eligible Job Holder and Entitled worker. Each employee will fall into 1 of these 3 categories and it's the employee's responsibility to automatically enroll each Eligible Job Holder into an Auto Enrolment pension scheme.

4. Contribute to employee's pensions in accordance with Auto Enrolment rules

Employers must make regular contributions into the pensions of all Eligible Job Holders that have been automatically enrolled into an Auto Enrolment pension and any Non Eligible Job Holders who have chosen to opt in.

5. Calculate and collect pension contributions from worker's salies

The employer must arrange to deduct employee contributions from all Eligible Job Holders who have been automatically enrolled into an Auto Enrolment pension, Non-Eligible Job Holders who have chosen to opt in and Entitled Workers who have chosen to join a pension scheme.

6. Manage the ingoing enrolment, opt-in and opt-out processes

The employer is responsible for a number of ongoing duties. These include: managing all new starters to make sure that the auto enrolment process is followed correctly, arranging opt-outs for any employees who do not want to be automatically managed or wish to leave the scheme, and arranging opt-ins for those employees who either were not automatically enrolled but wished to join the scheme or had previously chosen to opt-out but have now changed their mind and decided to opt back in.

7. Update The Pensions Regulator (TPR) with information about the scheme

Employers must submit a Declaration of Compliance to TPR within 5 months of their staging date. The purpose of the declaration is to prove to TPR that the employer has completed all of their Auto Enrolment duties and is, therefore, compliant with the rules.

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