Written by BrightPay UK: An impressive eight million plus employees have been enrolled into a workplace pension since auto enrolment came into effect 5 years ago. This means that these employees are now starting to save towards their retirement. The Pensions Regulator (TPR) reports that as of the end of June, 8,165,000 workers were saving for their retirement as a direct result of automatic enrolment.
In June 2017, 168,000 workers were enrolled into a workplace pension, which amounts to almost one every 15 seconds. Since July, over 500,000 small and micro employers are due to comply with their auto enrolment duties. All employers must continue to comply with auto enrolment on an ongoing basis including monitoring each employee’s age and qualifying earnings for changes to an employee’s worker status.
Employers will be faced with an increase in minimum contribution rates this coming April. From the 6th April 2018, the total minimum contribution rate will increase from 2% to 5%. From there, the minimum contribution rates are due to increase even further in April 2019. All employers will need to comply with these increased contribution rates.
Employers have the option to pay the the minimum employer contribution with the employee making up the difference to cover the total minimum contribution or they may choose to pay the total minimum contribution, covering both the employer and employee contributions. Payroll software should easily cater for new employers, ongoing auto enrolment assessment, phasing and re-enrolment.
Written by BrightPay. Exhibiting at Accountex 2018 on stand 430.