Automatic enrolment

Automatic enrolment is the name given to the pension reform designed to ensure that employees can pay into a workplace pension.

As an employer, you’re required to automatically enrol certain members of your workforce into a pension scheme, and you need to make contributions towards their pension funds.

This reform was introduced by the Department for Work and Pensions (DWP), and is regulated and governed by the Pensions Regulator.

When will automatic enrolment affect me?

Automatic enrolment law is already in force for large employers, with smaller employers following over the next few years.

You can find out the staging date for your business here.

Does Payroll support automatic enrolment?

Yes. You can prepare for automatic enrolment in Payroll, including assessing your workforce, communicating the upcoming changes and nominating a pensions contact with The Pensions Regulator.

You can also set up a qualifying pension scheme to ensure you’re meeting the automatic enrolment requirements, postpone your staging date and assess your employees for automatic enrolment.

We’re working hard to get all the other necessary features in place to help you process automatic enrolment pension deductions, and to provide all the guidance you need to understand and plan for your automatic enrolment duties as an employer.

Does my current workplace pension scheme qualify for automatic enrolment?

There are different ways of checking whether your pension scheme qualifies for automatic enrolment. TPR have different tiers that they use to categorise existing schemes, which define what contributions are needed.

For information on how to check this and what the tiers mean, please refer to TPR’s online tool

If an employee wants to opt out, should they inform us or our pension provider?

This depends on your pension provider. Most providers allow employees to opt out directly with them on their website or by phone, with the provider then informing you which employees have opted out.

Alternatively, if the employee chooses to fill in an opt out form, they should hand this in to you, and in turn you must inform the pension provider.

Can employees choose to opt out before the scheme commences?

No, an employee must be enrolled into a qualifying pension scheme before they can choose to opt out. This is to ensure they receive all relevant information to make an informed decision and so the pension provider has all the relevant employee details.