To comply with the Pensions Act 2008, employers must operate a workplace pensions scheme and contribute towards it. This is known as automatic enrolment. If you employ at least one person, you have certain legal duties.
Your legal duties for automatic enrolment begin on the day your first employee starts work.
1 Has a right to join a pension scheme
If they ask you to, you must provide a pension scheme for them, but you don’t have to pay contributions.
2 Has a right to opt in
If they ask to be put into a pension scheme, you must put them in your automatic enrolment pension scheme and pay regular contributions.
3 Automatically enrol
You must put these members of staff in your automatic enrolment pension scheme and pay regular contributions. You don’t need to ask their permission. If they give notice, or you give them notice, to leave employment before you have completed this process, you have a choice whether to automatically enrol them or not.
The minimum total contribution to the scheme is usually based on qualifying earnings. These are gross earnings from employment that fall between the lower and upper earnings limit.
There are circumstances when automatic enrolment duties don’t apply: