If you're looking to set up a new auto enrolment pension for your company, or your currently running one, you may be a little confused by the pension auto enrolment staging date. How do you find your staging date and what does it actually mean?
In this article, we'll explain what the auto enrolment staging date is and how it affects your business.
The staging date for auto enrolment is the date by which UK businesses should have launched their auto enrolment pension schemes.
You might be thinking, is an auto enrolment staging date needed anymore? Didn’t auto enrolment for pensions become a legal requirement a long time ago? The answer is yes. It’s been a legal requirement for all UK businesses since 2017.
The UK Government decided to stagger the rollout of this initiative to both avoid confusion and be able to offer guidance to businesses. Important support included why auto enrolment is so important and how it can be easily managed by in-house payroll and benefits teams. The biggest employers had the earlier staging dates, followed by smaller UK employers.
Any business is legally required to start automatic enrolment for any employee who is:
Which scheme they choose to use and where the pension funds are invested is up to each individual employer and employee, as long as registration is completed by the staging date.
The few exceptions include freelancers, self-employed individuals or businesses consisting of directors without employment contracts who do not need to auto enrol but are instead responsible for their own pension contributions.
The auto enrolment staging date is enforced by The Pensions Regulator.
It’s thought that 10 million new employees have registered onto a pension scheme thanks to auto enrolment – but the job isn’t done quite yet. As new workers join the workforce, it’s essential that employers continue to educate new staff on pensions, their options and the enormous impact they can have on their future (as well as ensuring they’re enrolled on time according to the staging date).
The aim of auto enrolment is to help employees better prepare for their future with the help of employer pensions schemes. Of course, employees do have an option to opt-out but employers will be required to re-enrol all eligible employees every 3 years to prove compliance at which point employees still wishing to be removed can request to do so.
The hope with this scheme is that employees will have a more secure financial future thanks to long term savings. Choosing a good workplace pension scheme can also help employers to attract and retain the best employees.
The staging date for your business is determined by the number of people on payroll as of April 1st 2012. From this date the Government rolled out staging dates, beginning with companies with 120,000 or more payrolled employees.
As of 2017, it is a legal requirement for all UK businesses to use auto enrolment for pension schemes, regardless of their size.
All auto enrolment for established businesses should have been completed, but there are still deadlines for new businesses or those hiring new employees.
New hires should be enrolled into your chosen company pension scheme upon starting (when eligible), or after a successful probationary period. You have a maximum of 3 months to enrol all eligible staff.
Re-enrolment must happen every 3 years, within 5 months of your original staging date, which is why it is so important that staging dates are known and recorded by internal teams responsible for pensions.
At this point, all employees should be re-enrolled and they will then have an opportunity to opt-out should they choose to do so.
Ensuring that eligible employees are added to the company pension scheme before the staging date falls on the shoulders of employers, and with mandatory enrolment legally enforceable, it's crucial that companies choose an auto enrolment pension that makes the admin easy.
The Penfold workplace pension is an award-winning auto enrolment scheme that makes running your company pension easy. We've rebuilt the workplace pension experience from scratch. Discover an engaging and efficient pension scheme that will help make your business a great place to work.
Request more information today and our team will explain how Penfold can help make auto enrolment effortless.
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