The document outlines key information about automatic enrolment for workplace pensions in the UK, applicable to employers with staff. It emphasizes the legal obligation to enroll certain employees and highlights important planning timelines, contribution rates, and compliance requirements. Additionally, it provides guidance on selecting a suitable pension scheme and communicating with employees regarding their enrolment status.

1. Automatic enrolment
Common questions and
key considerations

2. We’ve compiled a list of questions that
we’re commonly asked by our clients
about automatic enrolment, and
answered them on the following
slides.
www.easyasae.co.uk

3. What is automatic enrolment,
and does it apply to me?
If your organisation employs one or more people in the UK, then automatic
enrolment will apply to you. Every employer is required by law to enrol
certain workers (typically employees between age 22 and state pension age,
who earn over £10,000 p.a.) into a suitable workplace pension scheme and
contribute towards it. This is called ‘automatic enrolment’.

4. When do we need to be ready?
Organisations with 30 employees or fewer should be getting ready now,
as automatic enrolment can be complex and time-consuming. Every
organisation has been given a ‘staging date’ and you must have your
pension scheme in place by this date. You can check your staging date
here.
Employers who don’t comply could face a range of fines, starting with a
fixed penalty of £400, escalating to fines of at least £50 per day for non-
compliance. Even if you already operate a pension scheme, you need to
ensure it meets the qualifying criteria.

5. When should I start planning?
We recommend you start six months ahead of your staging date to give
yourself sufficient time to plan and make the necessary decisions, and
implement your agreed method of compliance.

6. What do we need to do?
By your staging date you need to:
•decide what contributions rates you will use and whether these will be
the same for all workers
•review any existing workplace pension arrangements you have
•establish a workplace pension scheme that meets the automatic
enrolment requirements
•decide what, if any, postponement rules you will apply
•ensure you have processes in place to deal with both your initial and
ongoing employer duties.

7. How much do I have to contribute?
There are 2 important decisions you need to make before your staging
date:
1.what will be my chosen definition of pensionable salary?
2.what contribution rates will apply and will it be the same for all workers?
The most widely used contribution model is based on qualifying earnings.
Generally, total contributions for eligible jobholders must meet a minimum
of 8% of qualifying earnings (also known as the relevant quality
requirements or RQR) by 6April 2019.

8. How much do I have to contribute?
Qualifying earnings include salary, wages, commission, bonuses,
overtime, statutory sick pay and statutory maternity, paternity and
adoption pay, that fall into a band of earnings between £5,824 and
£42,385 per year.
Employers must eventually pay a minimum of 3% of qualifying earnings
into a suitable workplace pension scheme.
For example:
An employer would be required to pay £10.44 per
month (£125.28 per annum) for an eligible jobholder
with total annual earnings of £10,000:
£10,000 - £5,824 = £4,176
£4,176 x 3% = £125.28 employer pension contribution

9. How do I choose the
right pension supplier?
On the Information for Employers section of their website, The Pensions
Regulator states that:
“You must select a pension scheme which meets certain legal
requirements. These include, for example, that the scheme does not
require the worker’s consent to join, it allows workers to join from
their first day of employment, it is tax registered in the UK and it
allows for the minimum legal contributions from employers and
workers.”

10. How do I choose the
right pension supplier?
“You should also choose a good quality pension scheme that is well
run, offers value for money and protects your workers’ retirement
savings. Selecting a good quality pension scheme is not a difficult
process and, from your perspective, it doesn’t have to cost more
than a scheme which is of a lesser quality.”
Through our Easy As AE website we offer 2 options,
both providing access to a good quality pension schemes.
Visit the Easy as AE website to find out more.

11. What are the requirements in terms
of communicating with staff?
There are certain statutory communications you need to issue to workers
from your staging date. These should be managed as part of your ongoing
compliance process. Every different worker type will need to be issued
with a communication following their first assessment. If after the first
assessment (i.e. in the pay period) there have been no changes to the
worker profile and type on your payroll, there may be no new actions
required.
However, when you take on new workers you’ll need to assess them the
first time they appear on your payroll. You also need to monitor workers
on an ongoing basis as either of the following may trigger a change in
worker category:
• A worker’s earnings increase and their worker category changes
• A worker turns 22

12. What are the requirements in terms
of communicating with staff?
Also, every three years (from your staging date), you’ll need to re-enrol
any workers who meet the eligible jobholder worker type – these workers
may have opted out or ceased active membership of the scheme.
You may wish to tell staff about automatic enrolment and the decisions
you’ve made ahead of your staging date. This will give workers the
opportunity to understand what automatic enrolment means and how it
may affect them.

13. Where can I go for help?
There is lots of useful information about automatic enrolment on our
Easy as AE website – click here to visit the site.
Easy as AE is a cost-effective online solution, from just £999 + VAT (or
£899 + VAT for existing Lucas Fettes & Partners clients or NCVO
members).
Call 0845 357 8910
Email easyasae@lucasfettes.co.uk