Employers Advised to Inform Employees of Increases in AE Pension Contributions

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There will be an increase to the minimum phased contribution rates for automatic enrolment for both employees and employers from 6th April 2018 and 6th April 2019.

minimum contributions

There are a number of steps that employers should take before the first increase on 6th April 2018 and again before the second increase on 6th April 2019. The Pensions Regulator has advised employers to prepare and begin these steps early.

Please see the below steps:

1. Identify the increases that apply to your own pension scheme

  • You may have to contact your pension provider or consult your pension scheme documents in order to check


2. Identify what employees the increases applies to

  • Increases will be made for all employees that were put in the automatic enrolment pension scheme that the employer contributes to. No increases will apply to contribution rates for employees that requested to be in a pension scheme that the employer is not contributing to.


3. Ensure the method of how pension calculations are made and paid will be able to handle the increases in pension contribution rates from 6th April 2018.

  • Check if your payroll provider/bureau is prepared for the increases in the pension contribution rates from 6th April 2018 and 2019.  You may need to contact your payroll software provider if you have any questions or are in doubt about what you need to do.
  • Ensure within your payroll software the increases are applied to the relevant employees at the relevant date.
  • If you process payroll as the employer, you will need to ensure you have the facility to incorporate the increases.
  • If you process your payroll using HMRC Basic PAYE Tools ensure that the increases for contribution rates will be implemented.


The Pensions Regulator provides an online contributions calculator to assist employers with calculating the workplace pension costs for each employee.


4. You may wish to consult with your pension provider to ensure they are prepared for the future increases and ensure you have the necessary information from them to enable you to submit the pension details for your employees after 6th April 2018 and 6th April 2019.


Employers should communicate with their employees to inform them of the future increases, The Pensions Regulator has a letter template which can be found here.

Further information can be found on The Pensions Regulator’s website - http://www.thepensionsregulator.gov.uk/



Written by Debbie Clarke | BrightPay Payroll Software

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