Auto Enrolment: Staging Dates

FEB14SD3 These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction.
Neil Esslemont
Head of Industry liaison team
Rebecca Woodley
Industry liaison team
February 2014
Staging dates
The information we provide is for guidance only and should not
be taken as a definitive interpretation of the law.

Scope
Staging dates
• No prior knowledge is needed.
• This module will:
– explain how staging dates are worked out
– tell you what options you have to change your staging date
– describe what happens if the company structure changes, and
– explain the terminology used.
• You may wish to view parts 1 or 2 of the Introduction to automatic
enrolment module and/or the Who is a worker? module.

Contents
• How is the staging date worked out?
• What happens on the staging date?
• Can I change the staging date?
• Impact of organisational changes.
• Review of module.
• What next?

Staging dates
How is the staging date worked out?

Who goes first?
• An employer only has one staging date.
• The employer duties apply to each employer from their staging date.
• The staging date is based on the size of the employer’s PAYE scheme or
schemes as of 1 April 2012.
• Generally, larger employers will stage before smaller ones:
– new employers* will go last, from May 2017.
Oct 2012 May 2017April 2014 June 2015
Large
employers
Medium
employers
Small/micro
employers
New*
employers
Feb 2018
*Employers that did not exist
(or were not using a PAYE)
as of 1 April 2012

• The staging date is based on HMRC’s record of the size of employer’s
PAYE scheme(s) as of 1 April 2012.
• The employer will not necessarily know the number of people in the PAYE
record, as it will probably not be equal to the number of employees they
had on 1 April 2012.
• The number of people in a PAYE scheme may include staff who:
– had left the company and were no longer employed, or
– were only being paid a pension.
• Any changes in the size of the PAYE schemes or which PAYE schemes
are being used after 1 April 2012 will not change the staging date.
The size of PAYE schemes

• For an employer that was using, as of 1 April 2012, any PAYE with 30 or
more people, the staging date is determined by the number of people in the
largest PAYE scheme that the employer was using at that time.
• For employers where all the PAYE schemes they were using, as of 1 April
2012, had less than 30 people, their staging date will be based on the
characters in their PAYE reference numbers.
• Please note that if, as of 1 April 2012, an employer was using a PAYE
reference of a scheme registered in another company’s name to pay anyone:
– that employer will also be considered as using that PAYE, and
– they could have an earlier staging date, if that PAYE scheme was larger
than all of their own PAYEs.
• You should use our staging date tool to find your date (see Useful links)
– enter all PAYEs being used as of 1 April 2012 and the earliest date is the
one that applies to that employer.
Finding the staging date

Staging dates
People in largest PAYE (on 1 April 2012) Staging date
120,000 or more 1 Oct 2012
50,000-119,999 1 Nov 2012
30,000-49,999 1 Jan 2013
20,000-29,999 1 Feb 2013
10,000-19,999 1 Mar 2013
6,000-9,999 1 Apr 2013
4,100-5,999 1 May 2013
4,000-4,099 1 Jun 2013
3,000-3,999 1 Jul 2013
2,000-2,999 1 Aug 2013
1,250-1,999 1 Sep 2013
800-1,249 1 Oct 2013
500-799 1 Nov 2013
350-499 1 Jan 2014
250-349 1 Feb 2014
* Staging date tool:
www.tpr.gov.uk/employers/tools/
Do not assume
you know the
number of people –
use our staging
date tool*

Staging dates continued…
People in largest PAYE (on 1 April 2012) Staging date
160-249 1 April 2014
90-159 1 May 2014
62-89 1 July 2014
61 1 August 2014
60 1 October 2014
59 1 November 2014
58 1 January 2015
54-57 1 March 2015
50-53 1 April 2015
40-49 1 August 2015
30-39 1 October 2015
Fewer than 30 (depends on the last 2 characters
in PAYE reference number)
1 June 2015
to 1 April 2017
Employers who do not have a PAYE scheme
1 April 2017
or New employer/PAYE scheme user
(depending on when PAYE income first
payable )
1 May 2017
to 1 Feb 2018
Do not assume
you know the
number of people –
use our staging
date tool*
* Staging date tool:
www.tpr.gov.uk/employers/tools/

Employers without a PAYE and new employers
• An employer who had no PAYE scheme as of 1 April 2012
will stage on 1April 2017, but
– an employer who starts to use a PAYE scheme for the first time after 1
April 2012 will be treated as a new employer.
• New employers setting up business on or after 1 April 2012 (up to 30
September 2017) will have a staging date between 1 May 2017 and 1
February 2018.
• Creating a new PAYE reference does not mean they are considered a new
employer (unless the employer was not using PAYE for any of their staff as
of 1 April 2012).

Staging profile (volumes of employers)

Staging dates
What happens on the staging date?

Automatic enrolment legislation gives employers a duty to:
 automatically enrol all eligible jobholders
 communicate to workers providing timely and appropriate information
 allow non-eligible jobholders to opt in and entitled workers to join
 manage opt outs within the opt-out period and promptly refund contributions
 automatically re-enrol all eligible jobholders every three years
 complete registration with The Pensions Regulator
 keep records, and
 maintain contributions
The employee safeguards state that employers:
 must not induce workers to opt out or cease membership of a scheme
 must not indicate to a potential jobholder that their decision to opt out will
affect the outcome of the recruitment process
Overview of legal duties and safeguards

At staging
• The employer duties apply to each employer from their staging date.
• The duties apply to all of the employer’s workers
– irrespective of which PAYE scheme they are paid through, and
– it does not matter whether or not the worker is paid using PAYE.
• The employer may choose to postpone* the assessment of any or all of
their workers at their staging date and any or all new joiners
– for up to three months - but this will not change the staging date.
• The employer will have to issue postponement notices and handle any opt
in requests during postponement.
* See our planning tool and ‘enrolling eligible jobholders’ for further details on postponement

Staging dates
Can I change the staging date?

Changing the staging date
• All employers in existence on 1 April 2012 have their staging date set.
• All future fluctuations in PAYE sizes have no effect on the staging date.
• Creating a new PAYE reference does not mean they are considered a
new employer (unless they were they were not using any PAYE for any of
their staff as of 1 April 2012).
• The duties apply to all of the employer’s workers, irrespective of which
PAYE scheme they are or were being paid through.
• If on their staging date, an employer has no workers, they will have no
duties at that time.
• Any employer may bring their staging date forward to an earlier date, but
will need to have a pension scheme in place and must inform us, giving at
least one month’s notice (ie one month before the new staging date.)

The alternative staging date
• Small employers would typically have a staging date
of 1 August 2015 or later.
• However, a small employer (with fewer than 50 workers as of 1 April
2012), who has a staging date on or before 1 April 2015, may choose to
move their staging date to a pre-prescribed alternative date between
August 2015 and April 2017.
• An employer who was a small employer on 1 April 2012, but has now
increased in size, is still considered a small employer.
• An employer with fewer than 50 workers now, but had 50 or more workers
on 1 April 2012, is not considered a small employer.
• You should inform us if you wish to use the alternative date, so that we
can change the timing of any letters we send to you.
• These alternative staging dates are shown on the following table.

Alternative staging dates for small employers
Original staging date
Prescribed alternative date
employer can choose
1 October 2012 and 1 November 2012 1 August 2015
1 January 2013 and 1 February 2013 1 October 2015
1 March 2013 and 1 April 2013 1 January 2016
1 May 2013 and 1 June 2013 1 February 2016
1 July 2013 and 1 August 2013 1 March 2016
1 September 2013 and 1 October 2013 1 April 2016
1 November 2013 and 1 January 2014 1 May 2016
1 February 2014 and 1 April 2014 1 July 2016
1 May 2014 and 1 July 2014 1 September 2016
1 August 2014 and 1 October 2014 1 November 2016
1 November 2014 and 1 January 2015 1 February 2017
1 March 2015 and 1 April 2015 1 April 2017

Staging dates
Impact of organisational changes?

Mergers and acquisitions
• If one company acquires another company, this will not necessarily change
the staging date or duties of either company. Any change of ownership of a
company is immaterial, other than through any consequential organisational
change (eg any transfer of staff).
• Any change in the usage of PAYE schemes will not affect the staging date
(unless a company uses the PAYE system for the first time).
• Any change in the size of a company after 1 April 2012 does not change
whether it is treated as a small employer (see alternative staging dates.)
• If employment contracts are transferred between companies (eg through
TUPE) the employees are treated as leaving one employer and joining their
new employer. If the new employer has already passed its staging date then
the duties will apply to these new workers on their joining date.
• If a company is dissolved it will have no duties. If a company has no workers
on their staging date then the company will have no duties.

Planning tool:
www.tpr.gov.uk/planner
Planning timeline

Question 1: How can an employer find out their staging date?
Answer: Use our staging date tool or, if available, refer to our letter.
Question 2: What should an employer do if they receive more than one letter
from us with different staging dates?
Answer: If an employer has more than one PAYE scheme, use our staging
date tool and enter all PAYE references (earliest date applies) - or
contact us.
Question 3: If, as of 1 April 2012, an employer was paying some of their own
employees using another company’s PAYE reference, this will not
affect their own staging date, as that PAYE is registered in the other
company’s name. True or false?
Answer: False. The employer would be considered to be using that PAYE
reference and, if that PAYE was the largest PAYE scheme used as
of 1 April 2012, it would determine their staging date.
Questions and answers

As of 1 April 2012, ACME Industries plc owned two subsidiary companies:
• ACME Industries had 11,500 workers and was using three PAYE schemes
• Betamax Components Ltd had 450 workers and was using their own PAYE
scheme, whilst Gamma Ray Ltd had 49 workers and were paying their staff
using one of ACME Industries’ PAYE references
Question 4: Which companies can delay their staging date?
Answer: Gamma Ray Ltd was using one of ACME Industries’ PAYE schemes
and may have a staging date on or before 1 April 2015.
If so, as they had less than 50 workers on 1 April 2012, they may choose to
move their staging date to a pre-prescribed alternative date between August
2015 and April 2017.
Question 5: On 1st January 2014, ACME sold Betamax to another
company. How will this affect these companies’ staging dates?
Answer: This will not change the staging date of any company, but the
workers might be transferred to another employer.
Questions and answers continued…

Staging dates
What next?

Know
your staging
date
Who is a
worker?
Reviewing
your pension
schemes
Employee
safeguards
Assessment
and automatic
enrolment
Communicate
to your workers
Postponement
and
transitional
period
Joining/
opting In
Record-
keeping/
Contribute
to your
pensions
Opting
out
Contractual
versus
Statutory
enrolment
Declaration of
compliance
(register)
Now Between now and staging At staging and beyond
Automatic enrolment
Introduction
to automatic
enrolment
Part 1:
Employer
duties
Part 2:
Getting
started

Useful links
• Modules: Introduction to automatic enrolment, Staging dates and Who is a worker?
www.tpr.gov.uk/help-clients
• Staging date tool:
www.tpr.gov.uk/employers/tools/staging-date.aspx
• Planning tool:
www.tpr.gov.uk/planner
• Letter templates for employers:
www.tpr.gov.uk/employers/letter-templates-for-employers.aspx
• Information about registration:
www.tpr.gov.uk/employers/registration.aspx
www.tpr.gov.uk/docs/automatic-enrolment-online-registration-checklist.pdf
• Our detailed guides for employers and pension professionals:
www.tpr.gov.uk/pensions-reform/detailed-guidance.aspx

Useful links continued…
More information about pensions and automatic enrolment:
• The Association of British Insurers:
www.abi.org.uk/pensionproviders
• The National Association of Pension Funds:
www.napf.co.uk
• National Employment Savings Trust:
www.nestpensions.org.uk
• Independent Financial Advisers:
www.unbiased.co.uk
• The Pensions Regulator:
www.tpr.gov.uk/docs/selecting-a-good-automatic-enrolment-scheme.pdf

We’d appreciate your feedback
on this presentation
https://www.surveymonkey.com/s/TPRBoxSetFeedback

We are here to help
Contact us at:
www.tpr.gov.uk/contact-us.aspx
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Connect with us on LinkedIn:
www.linkedin.com/groups?gid=2675456
Follow us on Twitter:
https://twitter.com/TPRgovuk
Thank you
The information we provide is for guidance only and should not
be taken as a definitive interpretation of the law.

Glossary

Automatic enrolment terms
• Automatic enrolment scheme – a qualifying pension scheme which can
be used for automatic enrolment
• Eligible jobholder (EJH) – a worker who must be automatically enrolled
into an automatic enrolment scheme
• Entitled worker (EW) – a worker who is entitled to join a pension scheme
• Jobholder – an eligible jobholder or non-eligible jobholder
• Non-eligible jobholder (NEJ) – a worker who has the right to opt in to an
automatic enrolment scheme
• Office holder – a person who has been appointed to a position by
a company or organisation, but doesn’t have a contract or receive regular
payment
• Personal services worker – an individual who has contracted to perform
work or services personally (this is sometimes referred to
as a ‘contract of services’)

Automatic enrolment terms continued…
• Postponement – an optional mechanism to delay the automatic enrolment
duties for workers
• Qualifying earnings – the earnings which determine a worker’s category
(EJH, NEJ or EW) and (as a band of earnings) may be used as the definition
of pensionable earnings
• Qualifying scheme – a pension scheme which meets the minimum criteria
and so existing members who are eligible jobholders will not need to be
automatic enrolled
• Staging date – the start date of an employer’s automatic enrolment duties
• Worker – an individual who works under a contract of employment (or a
personal services worker)

Other terms
• Active member – a person who is currently a member of the pension
scheme (and would normally be contributing to the scheme)
• Defined benefit (DB) – a pension scheme where the benefits payable on
retirement are known (eg ‘final salary’, where the retirement income is
based on the member’s salary)
• Defined contribution (DC) – a pension scheme where the contributions
are known, but the benefits are not guaranteed and are likely to depend on
the fund value at retirement
• Deferred member – a person who is no longer an active member of the
pension scheme, but has accrued some benefits (payable on retirement or
could be transferred)

Other terms continued…
• Hybrid – a pension scheme with a mixture of DB and DC components
• PAYE (Pay As You Earn) – HM Revenue & Customs’ (HMRC)
tax payment mechanism
• PAYE scheme – HMRC’s record for an employer who employs a worker or
workers for whom PAYE taxable income is payable
• PAYE scheme reference number – a number issued by HMRC to identify
each employer’s PAYE scheme(s)
• Pensionable earnings – the earnings on which pension contributions
are due

Auto Enrolment: Staging Dates

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