The Pensions Act 2008 require
all employers (other than one director-owner organisations) to offer a
qualifying workplace pension scheme to all “eligible jobholders”.
Here are some important elements of the new law:
- A business needs to identify who are “workers”. “Workers” are defined as any individual who works under a contract of employment or has a contract to perform work or services personally and is not undertaking the work as part of their own business.
- There will be three categories of “workers” – “eligible jobholders”, “non-eligible jobholders” and “entitled workers”. These categories are decided on age and earnings level.
- A National Pensions Savings Scheme requires automatic enrolment for all "eligible jobholders" unless the employer already offers a scheme, which is as good or better.
- The Government's scheme will be known as the "National Employment Savings Trust" (NEST).
- The Pensions Regulator will contact all eligible employers at least 12 months prior to their scheme starting to let them know the process.
- Both employees and employers will contribute to the scheme, which will be compulsory for the largest employers from October 2012.
- The scheme will be gradually introduced over a period of four years, starting from October 2012.
- The Pensions Regulator will ensure that employers fulfil their duties under the Act.
- Employers must not offer advice on pensions as this is against the Financial Services Act.
- Employers need to be aware of the qualifying pensions and exemptions from auto enrolment. They also need to “opt in or opt out” of the scheme annually.
- Employers need to consider amending employee contracts and handbooks to reflect the new pension arrangements
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associated professionals including HR, Health and Safety and Financial Advisors. If you need Insurance, HR, Health and Safety
or independent financial advice, please give me a ring and I’ll be happy to
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