Employer FAQ

Q. Why do I have to provide a workplace pension for my employee?

A. Due to the Pensions Act of 2008, all employers are legally obligated to offer a workplace pension scheme to all employees and enrolling them if they meet the criteria for auto enrolment.

Q. Do I have to set the pension up even though my employee has already told me they don’t want to be part of one?

A. Yes, this is a legal obligation to enrol employees that meet the criteria for auto enrolment. They can choose to leave the scheme but only after they become an active member of the pension scheme. This is a legal requirement.

Q. Can my employee take the money out at any point in time?

A. This will depend on the pension scheme rules and will defined in the starter pack from the pension scheme. With NEST, the employee can start receiving payments from the age of 55 currently.

Q. Can my employee move the money into another pension pot if they want to?

A. This will depend on the scheme rules. Most pension schemes allow money to be moved over to another pension scheme however they may charge an admin fee. This will include for employees working in the UK temporarily if they will to transfer their pension pot aboard.

Q. How much will this cost me?

A. Employees that are between 22 and state pension age will be expected to be automatically enrolled into the pension scheme with the minimum contributions calculated on qualifying earnings.

Q. What is ‘Qualifying earnings’?

A. ‘Qualifying earnings’ is a way of calculating contributions for auto enrolment. It is the gross pay minus the lower earnings limit for auto enrolment. We have chosen to use this as part of our default service as it is often the most cost-effective calculation for employers to manage.

Q. How does my employee join the pension scheme?

A. If your employee does not meet the criteria to be automatically enrolled they can chose to join the pension scheme by contacting us by email support@enableautoenrol.co.uk stating, ‘I confirm I personally submitted this notice to join a workplace pension scheme.’

Q. How does my employee leave the scheme?

A. If your employee does not wish to be in a pension scheme and they meet the criteria for auto enrolment, they will be required to become an active member of the pension scheme before they can choose to leave the scheme. The employee will receive a starter pack from the pension scheme provider that will inform them of the details of their pension scheme and how to leave the scheme.

Q. Can I offer alterative options to the employee rather than enrolling them into the pension scheme?

A. The decision for the employee leaving the pension scheme must remain as the employee’s decision. The employer cannot provide incentive to leave the scheme or interfere with the opt-out process. It is illegal for the employer to influence the decision of the employee leaving the pension scheme, this is referred to as inducement.

Q. What is NEST?

A. NEST is the government setup pension scheme (National Employment Saving Trust) that is specifically created for auto enrolment. It is free to use for the employer and part of our default service.

Q. Can I use another pension scheme other than NEST?

A. The choice of pension scheme is up to the employer, and you can choose any pension scheme that is qualifying for auto enrolment. Should you wish to use another pension scheme, we would strongly recommend getting in touch with us to discuss the details.

Q. How is the money invested?

A. We would recommend getting in touch with the pension scheme provider for more details of their current investments.

Q. What is a qualifying scheme?

A. A qualifying scheme is a pension scheme that is accepted for use with auto enrolment. If you wish to use a pension scheme other than NEST, you will be required to check if they able to be used for auto enrolment and get a pension scheme reference number.

Q. How do I make the contribution payments?

A. The payments are made at the end of each month for all pay periods within the current month via a direct debit that is setup with NEST. The payments will be made when contributions have been deducted in the pay period, if your employee leaves or has no contributions for a pay period, no contributions will be made.

Q. My employee is on maternity, am I still required to pay contributions?

A. Yes. Contributions must be sustained during the maternity period. If the employee was enrolled into the pension scheme prior to going on maternity, the employer contributions must be sustained at their standard salary.

Q. My employee is due to leave do I still need to pay pension contributions?

A. Yes. If the employee was enrolled into the pension scheme prior to their notice period, contributions must be sustained until their last working day. If the employee notice period began before the employee was enrolled, they may not need to be enrolled into the pension scheme. This would be dealt with on a case by case scenario.

Q. Why do I keep getting letters from The Pensions Regulator?

A. The Pensions Regulator will continue to send out communications to employers reminding them of their legal duties throughout the process. Our service will provide an end to end service for your auto enrolment duties and ensure all deadlines are met. Although we can manage all legal duties on behalf of the employer, communications from The Pensions Regulator will still be sent out regarding auto enrolment.