Starting in 2012 all employers will be required to enrol qualifying employees in a workplace pension. This is being introduced gradually and bigger employers will start first, with smaller employers starting from 2016 onward. Workers under 16 or over 75 cannot be included in the pension scheme.
An Eligible Worker has to be auto-enrolled, they may opt out, but must be automatically opted back in every 3 years.
A Non Eligible Worker does not have to be auto enrolled but can opt in. The employer pays contributions.
An Entitled Worker can opt in, but the employer does not have to contribute.
Every employer has to register with the Pensions Regulator (visit www.thepensionsregulator.gov.uk for more details.
Pension contributions will be a percentage of wages and this will gradually increase. The table shows the minimum contributions. In 2018, it is a total of 5% of wages, with a 3% contribution from employees and a 2% from the employer.
Why have I been put into a pension scheme?
All employers now have to put their workers into a pension scheme if they earn over £10,000 per year, are aged 22 or over and are under state pension age. This is the law, because the government wants to get more people to have another income in addition to the state pension when they retire.
What if I don’t want to join the scheme?
If you don’t want to join the scheme, you need to ask to leave it. You can choose to leave the scheme in the one month period starting on either the date of this letter or the date you were put in, whichever is the latest. You do this by completing the form available from our pension provider, Nest, and following their instructions.
You will need to sign the form, or if you send it electronically it will need to include confirmation that you are submitting it personally.
The pension provider will also be able to tell you when the one month period started, if you aren’t sure.
If you leave the scheme during this period any money you have already paid into your pension will be refunded and you won’t have become a member of the scheme on this occasion.
If you want to stop paying into your pension after the end of this one month period you can. The money you have already put in may be refunded but this will depend on the pension scheme we are using and how long you have been paying into it.
What if I ask to leave the scheme but then change my mind in the future?
You can ask to rejoin the scheme by contacting us in writing by sending a letter which has to be signed by you. Or if you send it electronically, it has to contain the phrase, ‘I confirm I personally submitted this notice to join a workplace pension scheme.’
If you earn more than £112 a week (£486 a month) we will pay into the pension scheme as well.
You can only re-join once in any 12 month period.
If I ask to leave the scheme, what happens after that?
Anyone who asks to leave, or stops paying into, the scheme will be put back into it at a later date (usually every three years if they meet certain criteria). This is because your circumstances may have changed and it may be the right time for you to start saving. We will contact you when this happens and you can ask to leave the scheme.
If I want to stay in the scheme do I have to pay in?
You will pay in 1% of your earnings each pay period. This will be taken directly from your pay and may include tax relief from the government. We will also pay in 1% of your earnings each pay period. Therefore, the total amount put into your pension pot will be 2% of your earnings.
Will this amount change?
As the money you pay in is a percentage of your pay, the amounts will automatically go up or down if your earnings do. Also, we are going to increase the percentage being paid into your pension over the next few years in line with the government’s minimum standards. From *6 April 2018 you will pay 3% of your earnings each pay period and we will pay 2%. And then from *6 April 2019, you will pay 5% and we will pay 3%. * These proposed dates are subject to Parliament approval.