The law on workplace pensions has changed. Under the Pensions Act 2008, every employer in the UK must put certain staff into a pension scheme and contribute towards it. This is called automatic enrolment.
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. You may now be wondering what to do next.
Check your duties
To work out what you need to do, when you need to do it and to make sure that you only complete the tasks relevant to you, answer the questions in The Pensions Regulator’s online Duties Checker.
The Duties Checker is designed for those without pensions experience and makes automatic enrolment as easy as possible – and takes less than 5 minutes to complete.
If you have already reached your staging date, make sure you don’t forget to complete your declaration of compliance and submit it to The Pensions Regulator (TPR). This must be done within five months of your staging date. It’s important that you do this, as you are at risk of being fined if despite putting staff into a pension, you fail to submit your declaration of compliance.
Key considerations to bear in mind
- Make sure you know what you need to do and by when – you will have duties even if you only employ one member of staff.
- Work out the costs which may be involved in terms of time and money – it may be less than you think. TPR has information to help employers understand the one-off costs to set up automatic enrolment, as well as the ongoing cost of paying money into the scheme and managing the process.
- Decide who will complete the tasks you need to undertake. While you can carry out the automatic enrolment tasks yourself, you may choose to ask your business adviser for extra support. Make sure you understand and agree which tasks you and they are doing so that nothing is missed.
Frequently asked questions from small employers
I need to find a pension scheme, but don’t know where to start
Not all schemes offer the same level of services and some will charge more than others, so you should look at different schemes before you decide which is suitable for you and your staff. TPR has information on its website which can help you to choose a pension scheme, with a list of providers who can offer pensions to small employers.
Can I use my existing scheme to automatically enrol my staff?
Maybe – but you first need to find out whether it meets certain conditions that will make it a ‘qualifying scheme for automatic enrolment’. Contact your pension scheme provider to find out.
I only have one staff member and their earnings fall under the threshold – do I still have to do anything?
Yes, you still have legal duties to meet. For example, you will need to tell your staff about automatic enrolment and complete and submit a declaration of compliance to TPR to let them know what you have done to meet your duties. Completing TPR’s online duties checker will confirm what your duties are and when they need to be met.
The business only has directors and doesn’t employ any other staff – do I still have duties?
You may be exempt from the automatic enrolment duties, but it’s important to check. If you are exempt and receiving letters from The Pensions Regulator, then you will need to tell them you are exempt. Take 5 minutes to complete TPRs online duties checker, which will confirm what you need to do.
What to expect from The Pensions Regulator
- TPR will send you letters at regular intervals before your staging date – the date your duties start.
- It is important you nominate a contact. This is the person TPR will send communications to about what to do and when.
- Using the Duties Checker means employers will be sent specific information tailored for their circumstances.
- TPR produces a free, monthly ‘News by Email’ which will help you to keep up to date with news, information, tools and resources on automatic enrolment.