What is Auto Enrolment?

Who does it affect?

All businesses must automatically enrol all employees who are:

Aged over 22
Under the state pension age
Work in the UK
Earn over £9,440 a year (this amount will be reviewed each year)

Part-time workers who earn less than that can ask to take part if they want to and, if they earn more than £5,564, their employer will be obliged to make a contribution too.

Those aged under 22, or over state pension age and still working, can also opt-in in the same way.

Contributions

The total minimum contribution will start at 2% of a worker's gross earnings (of which at least 1% must be paid in by the employer). By April 2019 this minimum will have risen to 8%, made up of at least 3% from the company, up to 4% from the employee, and 1% tax relief.

£

1 Oct 2012 - 5 April 2018

£

6 April 2018 to 5 April 2019

£

6 April 2019 onwards

When does the new law kick in?

Large employers were required to implement auto enrolment first, partially because their additional resources allowed them to find a scheme best suited to their workforce more quickly as well as the best technology to help them implement it.