What is Auto-Enrolment?
Auto-Enrolment is a compulsory pension scheme which has been introduced by the government in order to help rescue the country from a pension’s crisis. Currently 44% of employees do not save into a workplace pension and the quantity of people saving into a private pension is even less. By introducing auto-enrolment employers will have to take responsibility for enrolling all eligible employees into a workplace scheme.
How long will it take to set up?
There are approximately 33 administrative tasks to complete prior to setting up auto-enrolment. This will take the average business 103 days to complete. Whether or not you have a spare 3 months to spend on this preparation is not a consideration. This prep must be done or you will risk heavy fines from the regulator.
How do I know who to auto-enrol?
There are 3 types of employees: eligible job-holders, non eligible job-holders and entitled workers. All of these employees are entitled to join your workplace pension scheme however you may not have to contribute pension contributions for all of them. You will need to reassess your workforce every pay period regardless of whether this is monthly, weekly or both.
Will I get fined if I get it wrong?
Yes. Whilst the regulator has said they will be firm but fair there are heavy fines for getting this wrong. These can be anything from a daily fine which will vary from £50 per day to £10,000 (dependent on the size of your firm), or you may incur various other fines which can range from £400 – £5,000.
Can I use my existing payroll provider?
Possibly yes. Certain payroll providers provide a partial solution to the employer’s auto-enrolment requirements and many of these are still in the process of being developed. However they do not necessarily provide an end-to-end solution. It is wise to seek advice from an independent source in addition to looking at the software that your existing payroll provider offers.
What other solutions are there?
AEON is actively involved in the auto-enrolment market and has developed a solution which is available to employers of small – medium sized enterprises. If you would like to find out more about how our solution can benefit you please contact us on 01709730600 or email email@example.com.