Auto-enrolment question can the employer ignore

the first month if employees want to opt out (no scheme opened yet)?

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hi

Staging date 1/5/17 and employer has 6 weeks to enrol eligible works to a scheme. Scheme not set up by 31/5/17 (pay date). If some employees said they will opt out, what happens to their May salary? obviously the May payroll will not show any pension contributions. Will the payol  have to be amended once the schem is opened to show any contributions to AE (if any)?

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RLI
By lionofludesch
30th May 2017 11:17

I'd knock it off the first available pay.

However, having said that, the amounts are likely to be trivial.

Don't rely on employees who say they'll opt out. Sometimes they don't.

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By neiltonks
30th May 2017 13:50

The employer could always invoke their right to defer auto-enrolment for three months. This gives them time to set up the scheme, then the employees who are eligible jobholders at the end of the deferral period can be enrolled.

Any who want to opt out can then do so. To comply with the auto-enrolment regulations the employer must auto-enrol them before they can opt out.

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By HuntFord
30th May 2017 14:07

A few points. Important ones

If your staging date is 1st May, then you need to either postpone people for up to 3 months (in which case you send them a letter within 6 weeks of postponing them) or enrol them on the first pay day after your staging date (probably 31st May in this case)

This means that you need to put the deductions on May's salary. You can hold back the contributions and not send them to your pension provider until their opt-out period ends, but THEY MUST have been deducted from their pay, and enrolled into a scheme in that time.

You can't opt-out of something you aren't in. Enrol your people into a scheme, and then let them choose to opt-out if they wish.

The 6 weeks you are referring to is for informing employees they have been enrolled, not enrolling them.

If you've missed May's pay run, then I'd suggest writing to each employee and telling them you have postponed, using a date up until 1st August, and then on that date assess them again and enrol the ones who need to be.

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By Euan MacLennan
30th May 2017 14:18

I agree that as you have missed the boat in May, your only feasible option is to postpone assessment and send out 'postponement' letters to all eligible workers.

Assuming that you have even one eligible worker, you will have to set up a pension scheme - no ifs or buts - before the postponement period (max. 3 months) expires and as the others have said, enrol the eligible workers into the scheme and deduct pension contributions. Only after they have been enrolled will the pension provider offer an 'opt out'. If any member chooses to do so within the specified period, any contributions paid over for them will be refunded to the employer.

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By forrest gump
01st Jun 2017 12:44

if the employer decides postponement for up to 3 months, do employees have right that no postponement and that employer enrols them in the scheme from staging date?

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