Get your ducks in a row for re-enrolment

Re-enrolment ducks in a rowAuto enrolment legislation requires that every three years, employers must re-assess employees who have opted out or ceased active membership of a qualifying auto enrolment scheme. This is known as re-enrolment.

The aim of this is to give eligible employees that may have decided not to save in a workplace pension, the opportunity to re-consider their decision. People’s circumstances change and while they might not have felt in a position to save when auto enrolled initially, over the course of three years, they may feel differently.

For the biggest firms, the three year re-enrolment anniversary is looming large. For smaller firms, this may still be some time away. But, it pays to be prepared as re-enrolment isn’t necessarily a straightforward process and it isn’t a one time only event!

Top five tips for preparing for re-enrolment

  1. You must choose your own re-enrolment date and it can be any date within three months before your staging date anniversary and three months after.
  2. Choose your date wisely as you cannot use postponement. If you have more than one payroll you may want to choose a date which works well for all payrolls. You don’t need to tell The Pensions Regulator your chosen re-enrolment date until you re-certify compliance.
  3. Up-to-date and accurate records of which members of staff have opted out or ceased membership and when are critical so you know who to re-enrol. Employees that opted out within 12 months of re-enrolment don’t have to be re-enrolled nor do employees that have handed in their notice or those who have protection from lifetime allowance tax changes.
  4. Re-enrolment has to be done every three years and you have to re-declare your compliance with The Pensions Regulator. Generally you have two months from your re-enrolment date to re-declare compliance however if you do not have anyone to re-enrol the deadline is strictly three years exactly from when you originally declared compliance.
  5. Consider how you communicate with your staff about re-enrolment. NOW: Pensions will send the required re-enrolment notices but for some it could come as quite a surprise and be a cause of frustration so be prepared to answer their questions. There is no need to contact those who aren’t eligible to be re-enrolled.

With re-enrolment, a little planning and forethought goes a long way so don’t be tempted to leave it until the last minute.

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