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Did you know employers have a legal obligation to re-enrol some employees back into an automatic pension scheme every 3 years, regardless if they opted out the first time? Overlooking this could result in hefty financial penalties.

Thousands of UK business who auto-enrolled employees in 2014, will soon be approaching a vital phase that takes place every 3 years following their original staging date and many business owners are unaware of their commitments.

Employers MUST submit a re-declaration of compliance to The Pensions Regulator (TPR), even if they don’t have any staff to re-enrol. The qualifying threshold for employees to be automatically enrolled has been maintained at £10,000 per annum for 2018/19.

Follow the steps below to safeguard your legal obligations and avoid unnecessary penalties:

  • Choose your re-enrolment date

There’s a six month window in which you can choose a date for re-enrolment. This can be either 3 months before or after the third anniversary of your original staging date. You cannot postpone your re-enrolment date, so be sure to choose a date that’s achievable for your business.

  • Re-assess your workforce

The Pensions Regulator stipulates you only need to assess employees who were previously auto-enrolled and have subsequently either:

  • asked to leave/opted out of the pension scheme,
  • left after the end of the opt-out period,
  • reduced or halted their contributions to below the minimum pension level and who meet the earnings and age criteria to be re-enrolled.

You aren’t required to reassess employees who:

  • are aged 21 and under or over the stage pension age,
  • are meeting the minimum contribution requirements and who are currently in the pension auto-enrolment scheme,
  • don’t meet the age and earnings criteria for automatic enrolment.

Following assessment, you should re-enrol eligible staff into a qualifying pension and begin making contributions within six weeks of your re-enrolment date.

  • Communicate to your staff you’ve re-enrolled

Write to each employee within 4 weeks, informing who’s been re-enrolled into the pension scheme.

  • Complete your re-declaration of compliance

Submit your re-declaration of compliance to The Pension Regulator and inform them that you’ve met your legal obligations. This should be done within 3 months of the third anniversary of your staging date even if you don’t have any staff to re-enrol into the pension scheme.

We understand this topic can be confusing and time consuming to manage, so our Payroll team can guide you through each step and if necessary, manage the process for you. Please contact Rob de Main for any further advice on rdemain@hwca.com or 01604 746760 to speak to the team.

Further guidance on re-enrolment is available on the TPR website here

Find and contact your local Haines Watts office

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