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What is Automatic enrolment?

Automatic enrolment is the new legislation that has been introduced starting from October 2012 that states every employer in the UK must have a workplace pension scheme in place. Employers will also need to enrol their workers into the scheme and make contributions on their behalf.

Why is it happening?

Put simply: to increase private savings for retirement. With people now living longer than ever before, this means that they will enjoy a longer retirement. However, people are either not saving for it or not saving enough to provide them with the security they require. Auto enrolment has been designed to bridge this funding gap and encourage people to think more about how they will fund their retirement.

What happens if I dont automatically enrol my staff?

The Pensions Regulator is responsible for ensuring that every employer is compliant with auto enrolment laws.

As an employer you will first be told to put things right but failure to do so may lead to fines from 50 pounds to 10,000 pounds per day and could end in criminal prosecution.

This is why it is important to make sure that you are firstly aware of what auto enrolment is and secondly that you know exactly what you need to do before your staging date to make sure you are compliant with the upcoming automatic enrolment laws.