Auto Enrolment Pension Reform – Are You Prepared?

By Jelf

Posted 25/04/16

In this article we would like to introduce you to Jelf, a sister company to SMEi, where Jelf discusses Auto Enrolment – how it affects you and how they could help make the process easier for you.

Jelf Employee Benefits
The UK is experiencing the biggest shake-up of the law on workplace pensions for many years, thanks to the Pensions Act 2008.  Make no mistake this is probably one of the biggest changes your business will have to deal with for some time.

The new rules are simple. If you are an employer – whether you run a butcher, baker, a beauty salon, a pub, or a hotel – then you will almost certainly have new duties under the updated rules. In essence, you must enroll certain members of staff in a pension scheme and pay into it on their behalf – this is called “Automatic Enrolment”.

So far, Sounds Simple?

Unfortunately, actually setting up a scheme and following all the rules set out under the new law may be less straightforward.  It is likely to be a time consuming process, but one few businesses can afford to get wrong – the Pensions Regulator has the power to impose significant penalties. They range from a flat £400 fine and fines anywhere from £50 a day up to £10,000 a day (depending on the number of employees), to imprisonment for up to two years.

Naturally, then, every affected business will be keen to avoid falling foul of the regulator. Key to doing so is to make sure make sure your “Automatic Enrolment” pension scheme is set up correctly and on time, to remain compliant with the rules as staff members come and go, and to fix any issues that do arise quickly.

So, What do you Need to Think About?

First things first, businesses will have different dates by which they must have everything in place – this is called the “staging date”.  Meanwhile employees will fall into a number of categories depending on their eligibility. Finding out when your staging date is, and which of your employees qualify, is job number one.

Job number two is to select the pension scheme that is most appropriate to your business. That might mean converting an existing scheme into an Auto Enrolment pension scheme or selecting an entirely new qualifying pension scheme.

With that done, you will need to work out how much you and your employees will need to pay into the scheme.  The level of these contributions will be determined by what it known as the “pensionable salary”, which you will need to work out for every eligible employee.

The final stage is all about communication – with employees and with the Pensions Regulator.  It is important that your eligible employees understand the scheme, including their right to opt out, while those not directly eligible should also be informed of their options.  You must also inform the regulator of the steps you are taking to meet your Auto Enrolment responsibilities – providing a range of details via a “‘declaration of compliance”’.  This must be done within five calendar months of your staging date.

Clearly, then, complying with the new rules which is essential, however potentially a complicated and time-consuming task which may distract you from the everyday running of your business.

But Don’t Worry, Help is Available.

Jelf – a sister company to SMEi and an employee benefits specialist – has developed a dedicated service to help small businesses through the entire process. Jelf AEase and AEase Lite consultancy services are designed to manage all aspects of Auto Enrolment implementation and ongoing administration, so you can focus on running your core business.

Here is a short video from Jelf’s pensions team discussing Auto Enrolment
Want Help or Find out More?

Click here to request a call back from Jelf’s award winning team who can talk you through the options available, or alternatively visit for more information.

This article has been provided by Jelf.

Jelf Employee Benefits

Posted 25/04/16

Author: Jelf

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