Do I need to provide workers with a pension?

All UK employers have a legal obligation to offer a workplace pension scheme.

Who must be enrolled?

You must automatically enrol workers who are:

• Aged between 22 and State Pension age
• Earning above the minimum threshold set by the Government
• Working in the UK

Workers earning below the minimum threshold are not required to be enrolled, but they have the right to join the scheme if they want to.

What should I know about Opting Out?

Workers can choose to opt out after enrolment. If they opt out within one month, their contributions must be refunded.

At least once per year, you must allow opted-out workers the opportunity to rejoin.

Re-enrolment: at least every three years, you must automatically re-enrol eligible workers who previously opted out but remain eligible. You must write to workers to inform them of their re-enrolment.

What do I need to explain to workers?

When you enrol workers, you must provide a letter explaining:

• Their enrolment date
• The type of pension scheme
• The pension scheme provider
• Contribution amounts for both employer and employee
• How they can leave the scheme

What must you avoid when managing workplace pensions?

• Do not encourage or pressure your workers to opt out of the scheme
• Do not discriminate or dismiss anyone for their pension status or decisions
• Do not close a workplace pension scheme without first enrolling all members into an alternative scheme

What should I know about postponement?

You can delay enrolling workers for up to three months, but you must notify them in writing and allow them to join during this period if they request.

Is there any flexibility?

You may pay the first three months of pension contributions as a lump sum on the 22nd of the fourth month.

Can I offer salary sacrifice?

You can offer salary sacrifice arrangements, potentially reducing tax and National Insurance.

Staying Compliant

It’s essential to keep accurate records of all enrolments, contributions, and communications. Failure to comply with pension responsibilities can result in penalties from The Pensions Regulator, reputational damage, and decreased employee morale.

Responsible pension management fosters a culture of trust and confidence in your company.