A new government scheme under which employees must be automatically enrolled in a pension scheme was launched on 1 October.

Under the scheme, employers must provide access to a pension scheme for workers who are over 22 and earning more than £8,105 a year.

Employees can opt out of the scheme, but if they choose to stay in they must make contributions of up to three per cent of their salary. Employers must then contribute four per cent and tax relief of one per cent is available in addition.

Initially, auto-enrollment will only apply to the largest employers. Companies with 500 employees or fewer are not affected until January 2014 at the earliest, and the rules apply in stages so that full auto-enrollment will not be completed until January 2018.

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Updates: For employers: Pay and pensions |
Tagged with: Pension schemes |

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