Unless you’ve been hiding under a rock, or have spent the last few months on holiday, you will have heard about the Workplace Pension Scheme that will become a mandatory requirement for all businesses in the UK, regardless of size.
So how will the Workplace Pension Scheme affect your business?
Every employer with at least one member of staff will have the responsibility of putting individuals into their workplace pension scheme and contributing towards it. The scheme applies to employees who: are aged between 22 and the state pension age; work in the UK and earn more than £10,000 a year.
Whilst the scheme includes automatic enrolment for your staff, far too many small employers are not preparing adequately to meet their new duties, claims the Pensions Regulator.
Research also shows that almost two thirds of employers do not know the exact date that they will need to start complying with this new legislation.
It is estimated that 1.8 million small and micro employers, with fewer than 30 employees, will join auto-enrolment over the next couple of years.
Currently, the dates that have been released are as follows:
250 or more members: 1 October 2012 - 1 February 2014
50 to 249 members: 1 August 2015 - 1 October 2015
Test tranche for less than 30 members: 1 June 2015 - 30 June 2015
30 to 49 members: 1 August 2015 - 1 October 2015
Less than 30 members: 1 January 2016 - 1 April 2017
Further dates will be released by the Government and these can be viewed here.
The Pensions Regulator is warning those employers, that failure to sign up for automatic enrolment could result in a fixed penalty notice of £400, rising up to £10,000 if they continue to ignore their duties.
While escalating penalties have only been used on a handful of occasions, the Pensions Regulator warns it will issue penalties where necessary.
For further guidelines and assistance, and to ensure you are compliant, visit this link.