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  • Sandra Foreman

Auto Enrolment: employers what you need do within 12 months of your staging date

Updated: Jun 26, 2021

All UK employers are now aware of Pension Auto Enrolment (AE). The Revenue has been giving plenty of notice and has handed over to The Pension Regulator details of all employers most of whom would have now had a letter telling them of their obligations. Whilst Auto Enrolment may not be one of the hot tax topics to discuss in your leisure time, it is becoming more of a reality for all but the newest employers in the UK, and will affect even the smallest employers, with very few exceptions. Those exempted include those employing Construction Industry Contractors (CIS) and single director/owner-managed businesses where the directors are the only persons involved. Husband and wife director companies with no other employees would be one of those exempt employers. However, most employers will be required to adopt AE, and The Pension Regulator (TPR) puts it this way:

“Whether you’re a hairdresser, an architect or employ a personal care assistant, if you employ at least one person you are an employer and you have certain legal duties”.

(See details on TPR website at http://www.thepensionsregulator.gov.uk/en/employers).

Taking the point of 12 months before your staging date, the duties involved in auto enrolment include:


12 months before staging date

Check your staging date. The Pension Regulator (TPR) has made the initial compliance for Auto Enrolment fairly straight forward and easy starting with checking your staging date using the link http://www.thepensionsregulator.gov.uk/employers/staging-date.aspx

Next nominating a contact at https://automation.thepensionsregulator.gov.uk/Nomination. If you have your pension letter you will need your letter code to do this.

All Staff must then be assessed and enrolled by the staging date. This part of the process falls at other stages within this 12 months period and you will be sent reminders from The Pension Regulator at various internals up to your staging date. Payroll software are currently able to check your staff eligibility for AE. Check this with your payroll provider.


Six months before staging

Within six months of your staging date you must set up a pension scheme. This is the part that requires more input and greater attention to what must be done. Here again, The Pension Regulator offers guidance found at:

http://www.thepensionsregulator.gov.uk/choosing-a-pension-scheme.aspx

The UK government offers the NEST – National Employment Savings Trust as one scheme, but there are others that you can use such as the People’s Pension, Prudential, Royal London, Scottish Widows and others. A full list of these can be found at https://www.abi.org.uk/Insurance-and-savings/Products/Pensions/Saving-into-a-pension/Automatic-enrolment/Providers


Within six weeks of your staging date

All eligible employees must now be auto enrolled and sent letters about this including details of opting out. All other staff must be invited to join the scheme.


On your staging date

All formal assessments should now be completed and as employer you should be aware of your on-going duties which include:

  • Ensuring contributions are paid on time

  • Notices relating to staff opting in, joining or opting out are processed and accurate records are kept

  • Monitor staff ages and earnings to check staff eligibility to be auto enrolled

  • Pay contributions to pension scheme

  • Enrol staff and write to them

That Pension Auto Enrolment is a big change is no debate. The government is aware of this change and as well as providing help as detailed above, has given The Pension Regulator powers to level fines for non-compliance. The Employments Right Act also includes various elements to protect employees from any suggestion or encouragement from employers to opt out.

So all there is left to do is find your pension letter, check your staging date and follow the time lines as detailed above. Chances are you will need help to keep up with your auto enrolment responsibilities. The costs* of contributions needs to be factored in your business cash flow as well as the new processes and procedures. Get in touch to find out how we can help you meet your AE obligations.

*currently minimum employer contribution is 1% before 5/4/2018

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