Set up and manage a workplace pension scheme

Employers and eligible staff

Employers have to provide a workplace pension scheme for eligible staff as soon as your first member of staff starts working for you (known as your ‘duties start date’).


Check you’re an employer

You’re usually an employer if you deduct tax and National Insurance contributions from an employee’s wages.

Check you’re an employer if you’re not sure what your pension responsibilities are, for example you employ a carer or someone to work in your home.

Who you must enrol

You must enrol and make an employer’s contribution for all staff who:

  • are aged between 22 and the State Pension age
  • earn at least £10,000 a year
  • normally work in the UK (this includes people who are based in the UK but travel abroad for work)

If staff become eligible because of a change in their age or earnings, you must put them into your pension scheme and write to them within 6 weeks of the day they meet the criteria.

If you’re not sure what the state pension age is you can use the State Pension age calculator to find out.

You do not have to enrol an employee if they give you proof of their lifetime allowance protection.


How to set up a workplace pension scheme

You must set up a workplace pension scheme for eligible staff if you do not already offer one.

Use The Pensions Regulator’s tool for employers to find out what you need to do and when you need to do it.

If you already have a workplace pension scheme that you’d like to use for automatic enrolment, you must ask the provider if it meets the rules.


How much you must pay

You must pay at least 3% of your employee’s ‘qualifying earnings’ into your staff’s pension scheme.

Check the pension scheme you’re using to find out what counts as ‘qualifying earnings’.

Under most schemes, it’s the employee’s total earnings between £6,240 and £50,270 a year before tax. Total earnings include:

  • salary or wages
  • bonuses and commission
  • overtime
  • statutory sick pay
  • statutory maternity, paternity or adoption pay


Paying contributions

You must deduct contributions from your staff’s pay each month. You’ll need to pay these into your staff’s pension scheme by the 22nd day (19th if you pay by cheque) of the next month.

You must pay your contributions for each employee by the date you’ve agreed with your provider every time you run payroll. You must backdate any missed payments.

You may be fined if you pay late or do not pay the minimum contribution for each member of staff.

(GOV.UK)

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