Auto Enrolment – what employers need to know

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New pension obligations, commonly known as Auto Enrolment, are coming into effect on a phased basis from starting 1 October 2012.
Initially the largest employers with 120,000 or more employees will be required to comply with the new standards. Small and medium sized employers will follow over the next six years.

About Auto Enrolment
Under auto-enrolment, employers will have to auto-enroll eligible employees into a qualifying workplace pension scheme, and make mandatory employer contributions.

Employers will be given 12 months notice of their staging date. From this staging date, employers must automatically enroll eligible employees into a pension scheme when they reach the income tax threshold but contributions will kick in only from the employee threshold for national insurance contributions.

Employers will be able to operate a three-month postponement window for all employees (i.e. newly eligible existing employees and new employees), so that employees on short-term contracts do not need to be auto-enrolled in a pension scheme, although they will be able to opt in voluntarily during the postponement period.

In order to find out their staging date, an employer needs to know:

How many people are in the employer’s PAYE scheme
The employer’s PAYE reference.
The date you started you business if after April 2012
Further information and auto-enrolment staging dates, please view the Staging Dates PDF >>

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