As people are living longer and likely to enjoy a longer retirement, the UK govt introduced Workplace Pension reforms. The recommendations of the Independent Review on Workplace Pension reforms formed part of the Pensions Bill 2011. One of the key changes introduced is Automatic Enrolment. Introduced gradually, from 1 October 2012 and the staging date for each employer will depend on the number of workers in their PAYE scheme. Click here to see your staging date.
Automatic Enrolment is the core employer duty of work based pensions reform. It means that employers must automatically place all eligible employees into a pension scheme and advise them that they have done so. For employees in the NHS, the qualifying scheme is the National Health Service Superannuation Scheme (Scotland) (NHSSS(S)) and for employees in the teaching profession, the qualifying scheme is the Scottish Teachers' Superannuation Scheme.
All employees who are eligible under scheme regulations should be automatically included in the relevant section of the NHSSS(S) or STSS from the first day of employment.
- Automatically enrol all eligible jobholders into the scheme without the jobholder taking any action.
- Provide new members with information about the scheme they have been enrolled into and about automatic re-enrolment.
- Advise members who do not wish to be in the scheme, to obtain the opt out form from our website.
- Re-enrol jobholders, who have previously opted out on the third anniversary of the employers staging date (jobholders who have opted out within 12 months of the re-enrolment date are exempt until the next automatic re-enrolment date).
- Provide a refund of contributions to jobholder who opt out during the opt out period.
- Provide and contribute to an alternative qualifying pension scheme if the jobholder is not eligible to join the NHSSS(S) or STSS.
- Monitor opt outs and re-enrol jobholders if they become eligible under Auto Enrolment rules.
- Keep accurate records.
- Process opt in requests for eligible jobholders.
There are some occasions where an individual is not eligible to join the schemes, this is because they may have:
- Been an active member for the maximum 45 years.
- Retired early (age 55) with "special class" status (maximum membership is 40 years at age 55 or 45 years overall) (NHS only).
- Retired from the 1995 section and not eligible to rejoin the scheme (NHS only)
- A full time job with an NHS or STSS employer and a second job with the same or another NHS or STSS employer. This is because they will have reached the full time equivalent pensionable earnings that can be paid into the scheme and cannot be auto enrolled into the NHS or Teachers' scheme for their second job.
Where an employee is not eligible to join the NHSSS(S) or STSS but is eligible to join an alternative qualifying scheme, they must be enrolled in such a scheme. Employers will be able to choose an alternative pension provider of their choice, such as the National Employment Savings Trust (NEST). Full details of NEST can be found on the NEST website.
It is important to check our website regularly for up to date information about Auto Enrolment.