Guide to re-enrolment
As part of auto enrolment legislation, you have a duty to assess and re-enrol eligible employees into your workplace pension scheme every three years.
Since you started your pension scheme, some of your employees may have left, stopped paying pension contributions, or chosen to pay less than the minimum automatic enrolment contributions. In any case when there’s a change of circumstances, it’s up to you to make sure you’re up to date.
Step one: Choose your re-enrolment date
The default for your first re-enrolment date is your duties start date – which may have been your staging date – plus three years. You can set your re-enrolment date within a six-month window; three months either side of your default date.
Once you’ve decided when your re-enrolment date will be, you’ll need to re-enrol all eligible employees within six weeks of that date.
Can I use postponement for re-enrolment?
You can’t apply a postponement period when re-enrolling employees, but because you have a six month window to complete your re-enrolment duties, you can choose a re-enrolment date that suits your business.
Step two: Assess your workforce
When it comes to re-enrolment, you’ll need to assess your employees who were previously auto-enrolled onto your pension scheme but have since:
- Opted out
- Chosen to pay in less than the minimum contributions of auto enrolment; or
- Stopped paying pension contributions
You can choose not to assess your employees if any of them have made the above changes in the 12 months leading up to your re-enrolment date.
In addition, you could choose not to automatically enrol an employee if:
- Their contract is about to end
- They are a director of the company
- They are a partner in a Limited Liability Partnership (LLP)
- They are on notice of leaving employment
- They have told you that they have lifetime allowance protection in place with HMRC
Once you’ve decided who to assess, you’ll need to assess them using the same criteria as you did at your duties start date. You’ll then need to set up a pension for the eligible jobholders – employees aged 22 or over and earn above the minimum earnings threshold for auto enrolment – and contribute to it.
Step three: Write to the employees that you’ve re-enrolled
You’ll need to send letters to any employees that you’ve re-enrolled to let them know. This should be during the same six-week window that you have to re-enrol all eligible employees. The letter should also let them know that they have one month to opt out of the pension scheme if they’d like to.
Step four: Manage opt-outs
If any of your employees choose not to be re-enrolled in your workplace pension scheme, they’ll need to opt out. If you use our workplace pension, we’ll handle opt-outs for you and let you know when we receive them.
Some of your employees might have opted out previously, in which case they’ll need to opt out each time they’re re-enrolled if they’d rather not contribute to a pension scheme.
Step five: Re-declaration of compliance
You’ll need to submit a re-declaration of compliance to The Pensions Regulator within five months of the three-year anniversary of your duties start date. Even if you don’t have any employees that need to be re-enrolled, you still have to declare that you’re compliant.
Re-enrolment is an ongoing process. You’ll need to re-enrol all eligible employees on a three-year cycle and follow the steps above.