Copyright © Gary J Harding
Automatic pension enrolment: Employer duties outlined in guidance
The Pensions Regulator has published guidance for businesses that will be subject to automatic pension enrolment duties which are being phased in from this October.
The document outlines its policy for employers who must comply with the automatic enrolment duties, and also details its enforcement strategy for those who fail to do so.
Over the next few years, all eligible private sector employees must be automatically enrolled into a workplace pension scheme, with employers required to contribute to each individual's pension fund, in a Government bid to encourage more workers to save for their retirement.
The scheme is being rolled out from this October, when the largest firms will be required to enrol all eligible employees. Small companies will follow suit at gradual staging dates until it is compulsory for all firms to do so from 1 January 2016.
The regulator said: "The underlying aim of this strategy is to have in place effective systems to maximise employers' compliance with their duties (under the Pensions Act 2008) and to ensure non-compliance is held at an absolute minimum, to safeguard workers ability to save in a pension scheme."
The main objectives of its strategy are to establish and maintain a 'pro-compliance' culture amongst businesses and to educate all employers so that they are aware of their obligations.
In its commitment to preparing employers for auto enrolment, the Pensions Regulator will:
- Notify employers at 12 and three months prior to their staging date
- Work with the pensions industry to provide pension products that work with the auto enrolment duties
- Help employers communicate with their pension advisors
- Produce guidance material to provide information and guidance
- Provide a contact centre as a single point of call for queries
- Make the process of registration simple for employers to minimise administrative burdens
The Pensions Regulator warned it would be 'tough' but 'fair' with non-compliant employers, saying it would consider the circumstances of each business that fails to meet its obligations and work with them to help get them compliant.
Please contact us to find out how we can help your business prepare for the 2012 pension reforms.