Auto-Enrolment

1. Auto-Enrolment What does it mean for me?

2. What is it? Auto-enrolment is a compulsory pension scheme which all employers must adopt by a set time period – known as a staging date.

3. What are my legal obligations? As an employer you are legally obliged to implement your auto-enrolment arrangements by a specific staging date. This is being rolled out to the largest employers first and eventually to the smallest of employers. The date that applies to you could be anywhere up to June 2015. Auto-enrolment applies to all employers even if you have only one employee.

4. Who do I need to auto-enrol? Eligible job-holders Non eligible job-holders Entitled workers This is based on their ageand wage Sound confusing? That’s because it is!

5. What if an employee does not wish to be auto-enrolled? Once auto-enrolment has started all eligible jobholders must be enrolled within the scheme. They can then opt-out if they wish. If they opt-out you must re-enrol them in 3 years time. They can then opt-out again and be re-enrolled and opt-out … For those employees who don’t qualify they will still be able to join and you may have to contribute to their pension.

6. What if I already have a group pension (GPP) in place? Even if you have an existing scheme in place this is notsufficient for auto-enrolment purposes. You still have to assess your workforce and keep detailed records for 6 years as an integral part of your legal requirements.

7. Do I have any on-going responsibilities? Yes! Ad hoc: You must process opt-out and opt-in requests as required. Each pay period: Whether it is weekly, monthly or both you must monitor the age and wage of every employee at each pay period: For anybody who falls into a new category you must inform them of the change, write to them in a prescribed manner and process them in line with the requirements set out. Full account needs to be taken of any changes in relevant legislation as well as changing earnings thresholds and changes in pensionable age. Any new workers or leavers will similarly need to be assessed. Full record keeping must be kept of all such reviews for a period of up to 6 years.

8. An administrative time bomb The biggest problem most employers will face is yet another administrative burden that is both complex and time consuming. Most employers will be unable to adequately cope without seeking help from an external source or by employing a full time individual to sort this for them. Currently many payroll systems are unable to manage the compliance part of the requirements. Your accountant can not do this for you! You need to start setting up your scheme a minimum of 6 months before your staging date however we would recommend a minimum of 9 months.

9. What happens if I get it wrong? The regulator has said they will be ‘firm but fair’ to non compliant employers. However fines may be applied where they see fit. These include: Fixed penalty notices of £400. Escalating penalty notices from £50 - £10,000 per day (depending on the size of the company). Prohibited Recruitment Conduct Notices: £1,000 - £5,000.

10. AEON’s Solution AEON can: Provide you with a middleware software system that will help manage your payroll scheme making workplace assessments far easier. Provide you with the full support of Chartered Financial Planners who have a great deal of expertise and knowledge about group schemes. Provide you with the benefit of affordable prices based on the size of the firm meaning even the smallest of firms can afford financial advice. Provide you with the knowledge and assistance you need to ensure you avoid unaffordable fines.

11. What now? Either: Call us: 01709 730 600 OR Email us: enquires@aeon-ifa.co.uk We can then arrange a meeting where we will assess your auto-enrolment needs and decide on a plan of action. This initial meeting will be at our expense and without obligation.