AUTO-ENROLMENT requirements

The Pensions Regulator has issued the first of its documents to assist employers complying with the automatic enrolment requirements – which something that will present a significant impact on all employers and employees.

The Pensions Regulator is writing to the UK's biggest companies, alerting them to their new pension duties, which are introduced on a gradual or 'staged' basis according to employer size. The regulator is providing a 5-point checklist alongside with the notification letters, plus further information on its website.

In the next 6 months, nearly 600 of the largest organisations employing about a third of the UK workforce (around 10m employees) will have received letters marking 18 months to their particular duty (i.e automatic enrolment) date. In due course, every employer in the UK will have received at least two letters as they approach their duty date.

The Regulator is also now providing the following information:

• A summary of duties - a five-page overview of the new duties for employers.
• Know your date – employers can check their indicative staging date for the new duties.
• Detailed guidance - This covers all aspects of workplace pension reform legislation, and is designed to be suitable for large employers with experience of providing pensions, advisers and intermediaries.
• Software guidance - This guidance is designed to help payroll software developers implement changes to their products, better enabling them to support employers.

The following further material will be issued by the regulator later this year:

• Interactive tools – these online tools have been designed specifically to help smaller employers without previous engagement with pensions to understand the new duties. This will include a tool enabling employers to look up their indicative staging date by inputting their PAYE reference, as well as a tool to calculate pension contributions.
• Trustee checklist – aimed at trustees of existing schemes, this will set out some of the issues that should be taken into account when existing pension schemes are considered for automatic enrolment.

The issuing of this guidance prompt to employers to ensure that they will be ready to meet their automatic enrolment requirement, which will take effect between October 2012 and September 2016, depending on the size of employer.