MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Neil Esslemont Head of Industry liaison team Rebecca Woodley Industry liaison manager 9 March 2015 Automatic enrolment webinar for business advisers The information we provide is for guidance only and should not be taken as a definitive interpretation of the law.

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Welcome Today we will be looking at: which advisers employers are turning to for help the basics of automatic enrolment and what tasks you might help your clients with. There will then be the opportunity to ask questions. We won’t assume you already have prior knowledge.

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. What is automatic enrolment? The law on workplace pensions has changed. Every employer, with at least one member of staff, has new duties, including putting those who meet certain criteria into a workplace pension scheme and contributing towards it. This is called automatic enrolment. –It’s called this because it’s automatic for staff – they don’t have to do anything to be enrolled into a pension scheme. –It’s not automatic for employers. They need to take steps to make sure staff are enrolled.

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Research - who will employers turn to? Source: Employer tracker Small (6-49 staff) Have already (51%) or plan to consult (30%) 81% Source: Employer tracker Micro (1-5 staff) Have already (25%) or plan to consult (40%) 65%

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Create a plan and work out costs

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Staging date The employer duties apply to each employer from their staging date: –the duties apply to all of the employer’s workers from that date. You can look up a client's staging date by entering all the PAYE references, that were being used on 1 April 2012, into our staging date tool and their staging date will be the earliest date given by the tool.

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Our latest research shows that around 20% of small employers and almost half of micro employers do not know the exact date they need to comply with their duties. We are sending out letters to all employers telling them their staging date and to ask them to nominate a contact with us to get ongoing guidance and support. You may get more enquiries. You can also nominate yourself as your client’s secondary point of contact at: Find out your clients staging date here: Help your clients find their staging date

DM v3J These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Minimum DC 2% total contribution* DC scheme minimum contributions Oct 2017 * % of qualifying earnings Feb 2018 Minimum DC 1% employer contribution* Phase 1 Oct 2012 May 2017 April 2014 June 2015 Large employers Medium employers Small/micro employers New employers

DM v3J These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Min DC 5% total * Minimum DC 2% total contribution* DC scheme minimum contributions Oct 2018 Oct 2017 * % of qualifying earnings Feb 2018 Minimum DC 1% employer contribution* Min DC 2% employer * Phase 1 Phase 2 Oct 2012 May 2017 April 2014 June 2015 Large employers Medium employers Small/micro employers New employers

DM v3J These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Min DC 8% total * Min DC 5% total * Minimum DC 2% total contribution* DC scheme minimum contributions Oct 2018 Oct 2017 * % of qualifying earnings Feb 2018 Minimum DC 1% employer contribution* Min DC 2% employer * Min DC 3% employer * Phase 1 Phase 2 Phase 3 Oct 2012 May 2017 April 2014 June 2015 Large employers Medium employers Small/micro employers New employers

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Who are your client’s ‘workers’? Staff will be considered a ‘worker’ and subject to the automatic enrolment legislation * if they are: A.aged 16 to 74 (inclusive) and work or ordinarily work in the UK, and: B.either work under a contract of employment (an employee) C.or are not an employee – and these 3 conditions are met: i.they are contracted to carry out the work themselves and cannot freely subcontract the work or send a substitute; and ii.they are not a director of the company they are working for; and iii.are not undertaking the work as part of their own business. However, if your client is paying another company for work being carried out by a worker, rather than paying that worker themselves, then the other company would be considered the employer of that worker for automatic enrolment purposes. * There are some exemptions, which we will explain later – or see our website for full details

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Is a director a worker? A director of a company is not classed as a worker, unless: –the individual works for the company under a contract of employment and –there is at least one other person working for the company under a contract of employment A director who is not working under an employment contract is never classed as a worker The exemptions can apply to more than one director working for the same company

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Companies with no duties If a company has no workers on its staging date, then it has no duties under automatic enrolment and would not need to set up a pension scheme or complete a declaration of compliance. If the company has received a letter from us and they have no workers on their staging date, we ask that they inform our help desk by ing: with their PAYE ref. For more details about automatic enrolment exceptions, visit our website.

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Figures for (subject to parliamentary approval) Assessment of workers Monthly gross earnings Age Weekly gross earnings From From 22 to SPA* *State Pension Age From SPA to 74 £486 and below Has a right to join a pension scheme If they ask you to, you must provide a pension scheme for them but you don’t have to pay contributions £112 and below Over £486 up to £833 Has a right to opt in If they ask to be put into a pension scheme, you must put them in your automatic enrolment pension scheme Over £112 up to £192 Over £833 Has a right to opt in Automatically enrol Has a right to opt in Over £192

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Postponement Employers can delay the assessment of all or any of their workers from 1 day to a maximum of 3 months: –at their staging date, and then –when a new worker joins, or –when a worker becomes eligible to be automatically enrolled. They need to send a letter explaining this to their workers within six weeks of the start of postponement (eg staging or joining date). Some workers can ask to opt-in, even during postponement.

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Choose your software and check records Payroll software can help a client carry out: –the assessment –enrolment –communications, and –calculation of pension contributions  If their payroll software does not do all of the above, non-payroll software or services could be used. Some pension scheme providers offer some or all of these services. Clients should plan to test these systems before they go live.

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Choosing a pension scheme If an employer has an existing scheme they will need to check with the provider if it is suitable for automatic enrolment, as many will not be. There are a number of pension providers which will accept small employers. Information for employers can be found at: National Employment Savings Trust (NEST) is a pension scheme set up by the government that all employers can use to meet their duties. You can also get further details on our website at:

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. ‘Opting-out’ Workers have to be automatically enrolled before they can ‘opt out’. Workers must be told how to opt out (eg in their enrolment letter). The employer must not give or send them opt-out forms, this must be done by the pension provider. A one calendar month opt-out window starts when both of the following have happened: the worker is enrolled into the pension scheme, and when the the worker has been given an enrolment letter or . The worker will get a full refund of all contributions.

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Communicating to workers and keeping records At staging, employers will need to communicate directly to all their workers. Employers will also have to write to their workers to inform them if they are being automatically enrolled. The deadline for communications is usually six weeks. We have ‘template’ letters employers can customise and use. Employers must keep records about their workers and the pension scheme used to comply with the employer duties (pension providers and trustees will also have duties to keep records). Records must be kept for up to six years. Note. The communication requirements are changing soon. Look out for new templates on our website.

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Re-enrolment The re-enrolment date is roughly every three years from the employer’s staging date. On the re-enrolment date any worker who: –is not an active member of a qualifying scheme, and –has opted out or ceased membership more than 12 months ago...  will need to be re-assessed and, if eligible, automatically enrolled.

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Declaration of compliance Employers must complete a declaration of compliance within five months of their staging date. All postponements applied at the staging date must have come to an end before the declaration can be completed. Employers may receive a penalty fine if they do not complete their declaration on time. Employers will need to provide certain details, for example: –which pension schemes were used to comply with the duties, and –the number of eligible jobholders automatically enrolled into each scheme. You can start the online process early and partially complete your declaration.

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. What service will you offer your clients? Your clients may assume you will provide an end to end service. What services are you going to offer your clients? Will they include: confirming the staging date creating a plan and working out costs pension scheme selection/on-boarding assessment of the workforce sending enrolment and contribution data to the provider payment of contributions managing opt-ins/opt-outs and refunds of contributions member communications (eg issuing statutory letters/ s) maintaining records assisting with or completing the declaration of compliance?

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Any questions?

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. We are here to help! Subscribe to our news by Contact us at: Connect with us on LinkedIn: Follow us on Twitter: Thank you The information we provide is for guidance only and should not be taken as a definitive interpretation of the law.

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. We would really appreciate your feedback on this webinar. Feedback

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Additional slides

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Useful links Staging date tool: Planning tool: The essential guide to automatic enrolment: Our detailed guides for employers and business advisers: Information about declaration of compliance: Letter templates for employers:

MAR15WEBINAR These slides remain the property of The Pensions Regulator and their content should not be altered on reproduction. Who is a ‘personal services worker’? Whether someone is self employed or not, an individual (who is not a director) with a contract to perform work or services personally, may be a worker. The employer needs to judge whether or not they are undertaking the work as part of the individual’s own business. So, does the employer: –have control over an individual’s method of work (eg hours worked)? –provide any employee benefits? –bear all the significant financial risks in carrying out the work (eg the worker is not financially responsible for their faulty work)? –provide what is required for the individual to carry out the work (eg tools)?  If most or all of the above are true, then it would be reasonable to consider that they are not undertaking the work as part of their own business – and therefore they are a personal services worker. The list above is not exhaustive and an employer must take into account all relevant considerations and make a reasonable judgement.