Questions and Answers

What is a staging date?

This is the final date that a company has to have an appropriate pension scheme in place. The date is dependent on the number of employees in the company.

What is the qualifying age?

22 to retirement age

Can an employee refuse to be auto-enrolled?

All eligible employees have to be enrolled but they can opt out within one month if they wish to.

Can an existing scheme be used?

Many can be but will need to be changed to introduce the auto-enrolment process.

Can more than one scheme be used?

NEST can be chosen for some employees and another scheme used for others.

Can employers and employees pay more than the minimum contribution?

Yes, this can be arranged if required.

Can the staging date be changed?

The allocated staging date can not be postponed but it can be brought forward if that is more convenient with the company accounting dates. It has to be the first day of the month.

What about temporary and short term staff?

Auto-enrolment can be deferred for up to 3 months for new staff but after that even part time staff will need to be included if they earn enough.

What are the penalties for not complying with the new regulations?

There will be warning letters followed by a fixed fine and then ongoing daily fines. The amount will depend on the number of employees. For example, firms with more than 500 employees could be fined £10,000 a day whilst smaller firms of 5-49 would be fined £500 a day.

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