3. When?
• Auto-enrolment introduced gradually - larger
employers first; smaller employers later
• „Staging date‟ determined by number of people in
employer‟s PAYE payroll scheme on 1 April 2012
• See www.tpr.gov.uk/staging
• Employers can bring staging date
forward
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4. Who?
1. Enrol “eligible jobholders”
automatically into an automatic
enrolment scheme
2. Pay minimum DC contributions or
provide minimum DB benefits
3. Re-enrol eligible jobholders who
opt-out approx every 3yrs
4. Keep records
5. Not induce opt-outs
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5. Waiting period - postponement
• Employers can operate waiting period of up to 3
months by giving notice (within 1 month)
• May help with:
– casual/seasonal workers
– temporary workers
– quick leavers
– alignment of auto-enrolment with payroll
• Jobholders‟ right to opt-in
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6. Summary of worker categories
Earnings Age 16-21 Age 22-SPA SPA- age 75
Non-eligible Eligible Non-eligible
jobholder – jobholder – jobholder –
£8,105 or may opt-in to must be auto- may opt-in to
more an automatic enrolled into an an automatic
enrolment automatic enrolment
scheme enrolment scheme scheme
£5,564 - Non-eligible jobholder – may opt-in to an
£8,105 automatic enrolment scheme
Entitled worker – can request to join a pension
Less than
scheme (but it does not have to be a qualifying
£5,564
scheme and not entitled to employer contributions)
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7. What?
An automatic enrolment scheme:
• must be a qualifying pension scheme, and
• must not contain any provisions which:
– prevent the employer fulfilling its auto-
enrolment and re-enrolment duties, and
– require a member to make a choice or provide
information
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11. Contractual enrolment
• Where employer enrols workers into a pension
scheme pursuant to a contractual agreement
• Legal duty under s3 PA2008 does not apply, so:
– no statutory right to opt-out
– more limited information requirements
• Reduces need to treat different workers differently
• May work better with enrolling everybody
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12. Opting-out
• Eligible jobholders and non-eligible jobholders who
opt-in can opt-out within 1 month and receive a
refund of their contributions, but:
– not before they have been auto-enrolled
– opt-out paperwork must come from scheme
– employer must not incentivise opt-outs
– employers must re-enrol every 3 years
(within 6 month window)
• Can leave scheme after statutory opt-out window
• Beware workers with enhanced/fixed protection!
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13. Salary sacrifice
• Salary sacrifice arrangements can be continued
• Care needs to be taken to ensure that it is valid
and implemented consistently with the
employer‟s automatic enrolment duties
• HMRC has issued guidance on opting out, and
has confirmed there is no longer a requirement
for the arrangement to be in force for 12 months
14. Things you need to do
• Check self –employed arrangements
• Check agency / secondment agreements
• Set up procedures to track variable earnings
• Sort out approach on salary sacrifice / flex
• Deal with enhanced / fixed protection workers
• Allow lead times for contractual AE
15. Useful links
• The Pensions Regulator‟s „Pensions reform & auto-enrolment‟ homepage -
http://www.thepensionsregulator.gov.uk/pensions-reform.aspx
• The Pensions Regulator‟s detailed auto-enrolment guidance -
http://www.thepensionsregulator.gov.uk/pensions-reform/detailed-
guidance.aspx
• The Pensions Regulator‟s „Staging date timeline‟ -
http://www.thepensionsregulator.gov.uk/pensions-reform/staging-date-
timeline.aspx
• The Pensions Regulator „How to bring your staging date forward‟ -
http://www.thepensionsregulator.gov.uk/pensions-reform/bringing-
staging-date-forward.aspx
• Follow us on twitter @pensionlawyers and @ready2autoenrol
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