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Pension entitlement set to change

Meredith Hurst Tuesday, November 1, 2011

From 2012 groundbreaking new rules are set to impose enhanced pension duties on employers.  This will apply to all employers who engage at least one worker. 

A 'worker' is anyone who works under a contract of employment or works under a contract to perform services personally (i.e. they cannot send a substitute or sub-contract the work) and is not undertaking work as part of their own business.

The duties for the employer include:

  • Automatic enrolment into a pension scheme without the need for any action by the worker
  • Arranging membership of a pension scheme for those workers who choose to opt in or join a pension scheme
  • Providing information about pension entitlement

A key requirement of the new employer duties is for the employer to make arrangements for eligible workers to become active members of a pension scheme and to keep detailed records of how they have complied with the enrolment duty.  

The record keeping requirement is onerous as the Pensions Regulator can ask for the records to be produced.   

See the Daily Telegraph Q & A