Pension Auto Enrolment commences 1st October 2012 – are you ready?
The government has introduced a new law to make it easier for people to save for their retirement. It requires you as an employer to enrol your workers into a qualifying workplace scheme if they are not already in one. At present, many workers do not take up valuable pension benefits because they don’t make an application to join their employer’s scheme. Automatic enrolment is meant to overcome this.
Here are the 7 steps that can help you prepare for automatic enrolment:
1. Know your staging date – this is based upon the number of persons in your PAYE scheme on 1st April 2012.
2. Assess your workforce – you will need to be able to identify eligible jobholders who must be automatically enrolled. The non – eligible jobholders have the right to opt in, and the entitled workers who have a right to join but don’t have the right to have contributions paid on their behalf of you as their Employer.
3. Review your pension arrangements – will your existing scheme be suitable? Can it be adapted or will you need a new scheme?
4. Communicate the changes to all your workers – To keep your employees up to date with the latest changes, you will be under a legal obligation to write to them (except those under 16 or 75 and over) explaining what automatic enrolment into a workplace pension means to them.
5. Automatically enrol your “eligible jobholders” – in order to achieve this, the Employer must provide the following information to the Pension Scheme managers/trustees: Name/Sex/Date of birth/Automatic Enrolment Date/Postal residential address/National Insurance number.
The following information should also be provided unless it is not required by the scheme : Postal Work address/Work e-mail address where applicable/ Personal e-mail address where this is held/Gross earnings for any given pay period/ Value of contributions by Employer & eligible job holder for any pay reference period.
6. Register with The Pensions Regulator & maintain records – registration can be done online and must be completed within 4 months of the staging date.
7. Contribute to your workers’ pensions – the minimum contribution rates will be introduced over a period of time referred to as “phasing”
For more information about this new scheme follow this link- http://bit.ly/RPHjvq and make sure you are fully prepared!