Update on automatic enrolment opt out process
11 December 2014
Recently members have been asking about the opt out process in respect of automatic enrolment. The main question asked is about whether the employer can issue the opt out notice, and we now have the answer. To clarify (thank you Alex Rowson of QTAC Solutions), the employee must obtain the opt out notice from the pension provider, but can then give the notice to the employer for processing. The employer will then advise the pension provider by whatever process is agreed. The details can be found here .
The key points of the process are:
Staff who have been automatically enrolled or who have opted in have the right to opt out.
The decision to opt out must be taken freely by the staff member. Staff cannot opt out until after they’ve been automatically enrolled.
The opt-out period is one month from when active membership is created, or they receive the employer’s letter with the enrolment information, whichever is latest. Staff opt out by getting an opt-out notice from the pension scheme which they then complete and give to the employer. The employer must issue a full refund of any contributions the staff member has made within a month of receiving a valid notice.
Five million employees now automatically enrolled
15 December 2014
The number of employees automatically enrolled into a workplace pension scheme has passed the 5 million mark.
The announcement by the Pensions Minister Steve Webb mentions that the 5 million employees have been enrolled by 43,000 employers of all types, from charities to supermarkets and hospitals to football clubs and theatre groups.
He also took this opportunity to confirm that autumn 2016 will see the launch of a new system in which small pension pots will automatically follow workers from job to job.
Automatic enrolment earnings thresholds confirmed after consultation
18 December 2014
The Government has now confirmed the upper and lower thresholds which employers should use for 2015-16. This follows a consultation to seek views on how these thresholds should be set.
The announcement confirms that for 2015-16:
£5,824 will be the lower limit of the qualifying earnings band £42,385 will be the upper limit of the qualifying earnings band
Employers should use the amount someone earns between the lower and upper qualifying bands to work out how much that person must pay into a workplace pension.
CIPP Policy News Journal
08/04/2015, Page 351 of 521
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