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Auto Enrolment - Postponement

20th Jul 2015
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The payroll solution that provides all you need for Auto Enrolment.

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When it comes to auto enrolment, postponement can be a very useful feature for employers across the UK. Postponement allows employers to manage a number of issues more efficiently by deferring the date workers are assessed for up to three months.

Delaying assessment can enable employers to:

  • Avoid enrolling employees with a temporary rise in earnings

  • Allow for contractual workers

  • Align assessment dates with pay reference periods

  • Alter the enrolment of different categories of employees

Contrary to what some employers believe, postponement does not mean that you have nothing to do until your deferral date. In fact, postponing your staging date adds additional employer duties to your workload. Postponement communications must be sent to all affected employees within 6 weeks, otherwise postponement is null and void and AE will need to be backdated, which can cause significant problems.

Fail to Prepare, Prepare to Fail

A large number of businesses are ignoring the Pensions Regulator’s advice that is to commence preparation for auto enrolment in a timely manner (i.e. 6 months in advance). Many are leaving it too late to prepare adequately and are using postponement to give them additional time.

Postponement does not mean that you can start preparing for auto enrolment at a later date, and employers should avoid using it to delay the inevitable. Postponement won’t necessarily make things easier for you, but instead may lead to additional complications and increased workload.

Auto enrolment takes dedicated time to plan and prepare for. As the saying goes, “Fail to prepare, prepare to fail”. If you leave auto enrolment until the last minute, there is a greater risk of non-compliance fines. To date, the Pensions Regulator has issued 1,529 compliance notices and 367 fixed penalty notices, many of which were as a result of commencing preparation too late.

Payroll Software that Works

When asked about their biggest difficulty when staging, many of the larger firms found that some payroll systems were unable to deal with auto enrolment in an efficient manner. This meant that some employers had to switch payroll providers during or after the auto enrolment process.

Each payroll software provider caters for auto enrolment differently; and therefore it is vital that you research different payroll software options well in advance of your staging date.

With BrightPay, auto enrolment is easy.  BrightPay has full Auto Enrolment functionality, including employee assessment, communications, postponement, opt in, opt outs & refunds, reporting, and is integrated with various pension providers. You can see how BrightPay handles Auto Enrolment here.

A bureau licence with BrightPay allows you to have unlimited employers, unlimited employees, free phone and email support, and full auto enrolment functionality for just £199 per year (ex vat). Try it out for yourself with a 60 day free trial.

Click here to book an online demo of BrightPay. For more information, visit www.brightpay.co.uk, email [email protected], or phone 0845 3004 304.

If you would like to find out more about postponement, you can visit the Pensions Regulator’s website here.

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Written by Rachel Hynes for BrightPay Payroll and Auto Enrolment Software

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