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Will I have to auto enrol all my employees?

No. The legislation divides employees into three different categories. The requirement to provide a pension for an employee differs depending on the category into which he or she falls. The categories and requirements are as follows:

 

  • An eligible jobholder is a worker in the UK who is aged between 22 and state pension age earning more than £10,000 (annualised for 2014/15). An eligible jobholder must be automatically enrolled into a pension scheme on the employer’s staging date and the employer must pay contributions to this scheme for them at a level set out in the legislation.
  • A non-eligible jobholder is a worker in the UK who is either aged between 16 and 21, or between state pension age and 74 earning more than £10,000 (annualised), or aged between 16 and 74 and earning between £5,824 and £10,000 (annualised).

A non-eligible jobholder is entitled to opt into a qualifying pension scheme from the staging date and so must be provided with information on how to do this. If they do opt in then the employer must pay contributions to this scheme for them at a level set out in the legislation.

 

  • An entitled worker is a worker in the UK who is aged between 16 and 74 and earns less than £5,772 (annualised). An entitled worker is entitled to access to a pension scheme and the employer must provide them with information in relation to this.

The scheme that they are given access to does not have to be the same scheme that eligible and non-eligible jobholders are given access to and the employer does not have to pay any contributions to the scheme in relation to them.

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With the introduction of workplace pensions already underway for a number of larger businesses in the UK, it’s important that you act now and start preparing – there’s a lot that can be put in place earlier.

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