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March 2012

Pensions auto enrolment dates deferred for smaller employers

In January we wrote about pensions auto enrolment dates, and now the timetable for the introduction of Pensions Auto Enrolment has been revised for smaller employers.

Employers have been aware for some time now that the government is to introduce legislation designed to encourage more people to save for their retirement.

Under the rules employers must:
• ‘auto-enrol’ eligible employees into a pension scheme
• make employer pension contributions for them, and
• make deductions of employee pension contributions from the employees pay.

The rules come into force from October 2012. However they only impact on the largest employers from that date, as few employers have a workforce of more than 120,000. For those employers with a more modest number of employees the start dates have been amended. This was previously announced and has been confirmed in a written ministerial statement.

Steve Webb, the Minister of State, Department for Work and Pensions confirmed:

‘On 28 November 2011, the Government announced that the timetable for the implementation of automatic enrolment will be adjusted so that small businesses are not affected by the reforms during this Parliament. This will provide them with some additional breathing space to prepare for the reforms whilst operating in tough economic times.’

‘I can now confirm that under the revised timeline, all employers with an existing staging date of on or before 1 February 2014 are unaffected. This means that no large employer will have to make any changes to their plans – which are in many cases already advanced.’

Medium sized employers will be re-allocated automatic enrolment dates between 1 April 2014 and 1 April 2015. This means that the implementation dates of some of these employers will be up to nine months later. However, this still means that around 70% of eligible workers will be automatically enrolled before the end of this Parliament compared with around 75% under previous arrangements.’

‘Small employers will be allocated automatic enrolment dates between 1 June 2015 and 1 April 2017.’

The guidance contains a table of revised implementation dates for small and medium employers, by size. We will keep you informed of further announcements.

For more information about this or if you would like to talk to someone about your own pension, please contact Glen Callow on 0121 711 6353.