Three years on from the launch of auto-enrolment and more than half a million UK employers had completed their pension auto-enrolment duties by the end of March 2017 (1). The figures released by The Pensions Regulator (TPR) also showed that some 700,000 small and micro-businesses we’re still to complete the process.
However, before you breathe a sigh of release, did you know that you have to re-enrol every three years? The Pension Regulator is in the midst of a major campaign to tell businesses all about their re-enrolment duties (2).
The re-enrolment process concerns putting your employees back into a pension and must be carried out around three years after your initial enrolment staging date. The re-enrol process depends on whether you have staff to re-enrol or not. Completing the re-enrolment process is a legal duty and carries a fine if not completed (2).
The process to be followed starts with selecting a re-enrolment date from a six-month window which starts 3 months before your enrolment anniversary. This done you’ll need to identify which of your staff need to enrolled back into the pension scheme and write to them informing them about the re-enrolment. Finally, inform the Pension Regulator that you’ve met your legal duties by completing a re-declaration of compliance.
Auto-enrolment can certainly be described as a great success in terms of its mission to get more people saving for their retirement. It is estimated that by 2020 there will be more than 9m new pension savers (3). By the end of March 2017 more than 7.6 million employees are now saving for their retirement after being enrolled into a workplace pension since 2012 (4).
The value of pensions and the income they produce can fall as well as rise. You may get back less than you invested.
The Financial Conduct Authority does not regulate on Auto Enrolment.