Pensions — auto-enrolment

The entitlement to a workplace pension depends on the terms and conditions of the employment contract. However, there have also been important recent changes in pensions law, through the gradual phasing in of pensions auto-enrolment. A duty on all employers to auto-enrol eligible job-holders who are not already participating in a workplace pension into a qualifying scheme such as the National Employment Savings Trust (NEST) is being implemented in stages.

The new law requires every employer to automatically enrol workers into a workplace pension scheme if they:

• are aged at least 22 but under state pension age;

• earn at least £10,000 a year;

• work, or ordinarily work, in the UK.

This is called automatic enrolment. It began in October 2012 with workplaces of 120,000 or more. Employers must enrol all eligible workers into workplace pensions between 2012 and 2018 (depending on their “staging date”). Some existing schemes may already meet the minimum qualifying requirements of an auto-enrolment scheme.

Since 1 July 2012, it has been against the law for any employer to:

• induce workers to opt out of a qualifying pension scheme;

• ask workers during the recruitment process if they plan to opt out; or

• treat workers detrimentally if they seek to enforce their pension rights.

For more information, see the website of the Pensions Regulator.

In 2013, important changes were also made to public sector pensions. See Chapter 12 for Information about the New Fair Deal for Pensions. Other significant changes to the local government pensions scheme came into effect on 1 April 2014 (further information is available at: www.lgps2014.org), and for other public sector pensions on 1 April 2015.