Every 3 years the government wants to put employees who have ceased active membership back into a pension scheme. It’s a process called re enrolment – sometimes referred to as cyclical re enrolment.
3 Steps to Re enrolment
- Choose a re-enrolment date
- Work out who should be re enrolled
- Manage the Re enrolment process
- Re declare your compliance with The Pensions Regulator
Some things to consider
- It’s just one date per employer, so if you operate more than one PAYE payroll, consider a date which best aligns to all the payrolls you operate.
- Think about any upcoming business priorities you want re-enrolment to coincide with, or any you don’t.
- Spare a thought for your next cyclical re-enrolment window in another three years. Whatever date you choose this time, you’ll use that as the centre of your six month window next time around.
- Please note, unlike your original automatic enrolment sign-up, you can’t use postponement for re-enrolment.
1. Choose an enrolment date…
Do you have no one to re-enrol?
If so, it’s still important you complete step 4 – otherwise you may be fined by The Pensions Regulator.
2. Work out which employees need to be re-enrolled
Out of the employees who have ceased active membership or opted out, you’re looking for those eligible jobholders who are currently eligible for automatic enrolment into a workplace pension.
You need to let your employees know that they will be re enrolled if they have ceased contributions or have opted out and they..
- normally work in the UK
- earn above £10,000 a year (for the current tax year)
- are aged between 22 and State Pension age.
There are certain requirements and exceptions:
Some employees don’t need to be re-enrolled
You don’t have to re-enrol employees who, on your re-enrolment date:
- have not yet had an automatic enrolment date, which will be employees who have been a non-eligible jobholder or an entitled worker since the start of their employment or the staging date and who have never met the criteria to be an eligible jobholder
- are subject to postponement
Not all your eligible jobholders need to be re-enrolled, so you can choose whether to include employees who:
- have ceased active membership in the 12 months leading up to your chosen re-enrolment date
- have given notice or been given notice of the end of their employment
- you have reasonable grounds to believe have protected themselves from tax charges on their pension savings under HMRC’s Primary, Enhanced or Fixed protection
- have been paid a winding up lump sum within the 12 months before your re-enrolment date and then ceased their employment with you and then been subsequently re-employed by you.
- are directors who have a contract of employment with the company
- are genuine partners of a limited liability partnership – those partners who are not employees for tax purposes
3. Manage the re enrolment process.
How you do this depends on how you assess employee pension contributions.
Check the assessment method that applies to you
Do you use a payroll provider to assess your employees?
If so, check whether your payroll provider will be able to manage automatic re-enrolment for you.
Speak to your payroll provider to check how they’re approaching automatic re-enrolment.
- They may be managing the process for you automatically, but if so, you’ll still need to complete this checklist and re-declare your compliance with The Pensions Regulator.
- Your payroll provider can assess which of your employees are eligible jobholders out of those who have stopped contributing.
- You may also need to advise your payroll provider on whether you want to re-enrol any of your exempt employees.
Do you assess your employees manually?
If so, you’ll need to check your employee data includes everyone who should be re-enrolled.
Please note you, or your payroll provider, will still need to continue ongoing assessment of all your employees as usual to keep their pension contributions accurate.
4. Re-declare your compliance with The Pensions Regulator
You’re legally required to re-declare your compliance on The Pensions Regulator website to show you’ve complied with your employer duties.
If you don’t complete it in time you may be fined
You have to re-declare within five calendar months of the 3-year anniversary of your staging date or duties start date (even if you have no one to re-enrol).
You’ll need to include details of yourself, the company, PAYE schemes and your workforce, as well as your pension plan details.
When you’ve submitted your re-declaration to The Pensions Regulator, they’ll send you an acknowledgement letter. This completes your re-enrolment duties until your next automatic re-enrolment window in around three years.
Please contact us if you need help! 01206 331414