Chester 01244 405555

Grosvenor Court
Foregate Street Chester
Cheshire CH1 1HG
DX: 19990 Chester

Shrewsbury 01743 443 043

Lakeside House
Oxon Business Park
Shrewsbury SY3 5HJ
DX: 148563 Shrewsbury 14

Airport City, Manchester 0844 800 8346

Office 129
Manchester Business Park
3000 Aviator Way
Manchester M22 5TG

Send us a message
Our Offices

Delayed Automatic Pension Enrolment for Small Firms

8th December, 2011

As you may be aware, the Pensions Act 2008 introduced a number of notable changes to the UK’s pension regime. Undoubtedly, one the most far reaching is the compulsion on employers to automatically enrol their employees into a pension scheme.  This will involve employers using their own qualifying scheme or a government established scheme (NEST) and making minimum pension contributions for auto-enrolled employees.

Ultimately, employers will be obliged to contribute at least 3% of the employee’s earnings.  Total contributions paid by the employee and the employer must be at least 8% of the employee’s earnings.

Mandatory employer contributions will be phased in over six years.  Broadly, employers will be required to pay contributions of 1% of an employee’s earnings in the first four years, rising to 2% in the fifth year and the full 3% from the sixth year onwards.

This week it was announced by Steve Webb, Pensions Minister, that firms with fewer than 50 employees will be given more time before they must start enrolling staff into such pension schemes.

The starting deadline for small firms has moved from April 2014 to May 2015.  The aim is to help the smaller firms save money and to give those employers additional time to impose the compulsory scheme.

Up to 9 million employees will be affected by automatic enrolment and of those, 44% of employees will see their enrolment delayed (Department for Work and Pensions).

If you are considering amending your contracts of employment and/or employee handbook to comply with these changes, please contact Helen Watson in our employment team for further information.

 

You might also be interested in...

Compensation for Employees Made Redundant Due to Administration

16th October, 2019

Our solicitors have a proven track record of recovering compensation for clients where their employer is in administration... Read More »

Selling a Business - Zoe Lloyd Article

What is Due Diligence and How We Can Help

16th October, 2019

Due diligence is the process undertaken by a buyer before buying a company/business. The buyer, working with their... Read More »

Wills Article - Paul Caslin

Understanding the “commorientes rule” and survivorship

16th October, 2019

In England and Wales, where two or more people have died simultaneously or where it is not possible... Read More »

Contact Us