My helpful hint for March is all to do with Auto Enrolment responsibilities for employers.
The following is a very basic level of explanation about Auto Enrolment. For full details, visit https://www.thepensionsregulator.gov.uk/
So, you have a new business and you may be thinking about employing staff. Great news, but don’t forget:
Every employer in the UK must put certain members of their staff into a workplace pension scheme.
I say “certain members”, because they need to hit certain criteria before they are “automatically enrolled” into a pension. This is not a choice for employers, these are your legal duties.
These legal duties begin on the very first day your employee(s) starts work, also known as your Duties Start Date.
What’s the criteria?
- Are any of your employee’s aged between 22 and state pension age?
- Before tax, do any of your new employees earn more than
- £10,000 per annum or
- £833 per month or
- £192 per week?
If the answer to both questions is yes, as an employer, you must put these employees into a workplace pension scheme.
Choose a pension scheme
This may take some time to complete, so don’t delay. You can find a scheme yourself or seek help from an accountant.
Assess your employees
Work out which of your employees hit the above criteria. There is a useful link on The Pensions Regulator website
Put your employees into a scheme
After assessment, you will know who to include. (It is possible to Postpone employees but check whether this is the right option for you).
Your scheme provider will advise how to proceed with putting your eligible employees into a pension scheme.
Write to your staff
It is your legal duty to write to your employees explaining how auto enrolment applies to them. You have six weeks to do this after your duties start date. There are templates on-line, or your scheme provider may do this for you.
What if I don’t have employees who hit the criteria?
Even if you don’t have employees who must be put into a pension scheme now, you still need to complete your declaration of compliance.
Remember, if you don’t comply with your legal duties, you could be fined. As an employer, automatic enrolment lays at your feet, even if you pay someone else to process your payroll.