The majority of employers will already have a schedule in place for completing their automatic enrolment duties. However, it is important to also take into consideration automatic re-enrolment. Re-enrolment occurs every three years where employers must enrol certain members of staff back into an automatic enrolment pension scheme. This might sound tedious but with the right payroll tools and processes, automatic re-enrolment can be a breeze. In this blog, we will go over five simple steps to follow for re-enrolment in order to stay compliant.
An employer’s re-enrolment date occurs by default on the third anniversary of their automatic enrolment staging date. Fortunately, there is a six month window that employers can choose from, being three months either side of the anniversary of the staging date.
When the chosen date arrives, employers must assess certain members of staff for re-enrolment. Different departments or employees cannot be assessed on different days. Also, postponement cannot be used when it comes to re-enrolment.
As employers can choose their own date for re-enrolment, this can be used as an opportunity to align the re-enrolment date with other important dates, such as the start of their financial year, or as a way to avoid seasonal peaks.
The employees that must be assessed will meet one of the following criteria:
There may be certain staff that meet the above criteria but do not need to be assessed if they fall into one of these categories:
Where employees meet the age and earnings criteria, there are certain circumstances where the employer can choose whether or not to re-enrol the employee:
Once the employer has determined which employees are eligible for automatic re-enrolment, the next step is to re-enrol these employees into a workplace pension scheme. This must be done within six weeks of the chosen re-enrolment date. Employer and employee contributions must also be paid into the pension scheme.
After re-enrolling staff back into an automatic enrolment pension scheme, employers are legally obliged to write to each member of staff informing them that they have been re-enrolled into the pension scheme. The letter must explain that they have been enrolled, explain their right to opt out of the pension scheme and that detail what contributions will be paid into the scheme.
The re-declaration of compliance must be completed within five months of the third anniversary of an employer’s automatic enrolment staging date. The re-enrollment date chosen by the employer does not change the re-declaration deadline.
The re-declaration of compliance is an online form that informs The Pensions Regulator that the employer has met their legal re-enrolment duties. If someone else is helping the employer with their automatic enrolment duties, it is still the employer's legal responsibility to ensure the re-declaration is completed on time and filled in correctly.
Although an employer has five months to complete this re-declaration of compliance, it is recommended that it is completed as soon as possible after the re-enrolment date.
Re-enrolment may seem like a long process that will take up an employer’s valuable time. However, using payroll software that handles the re-enrolment process, such as BrightPay, will greatly reduce the hours required to remain compliant.
After entering the re-enrolment date in BrightPay, the software will automatically assess and flag employees for re-enrolment before the payroll is processed for the pay period. BrightPay will also generate the letters needed for employees that were re-enrolled. By automating the re-enrolment duties, BrightPay will save employers time which can be invested into other important business matters.