Workplace Pension Schemes

New legislation to start in April 2016

A new law the government is introducing shall mean that employers must put their employees automatically into a workplace pension scheme if they fulfil the following criteria:

	Aged between 22 and State Pension age
	Earn over £10,000 per year
	Work within the United Kingdom

The new scheme's automatic enrolment shall begin from April 16, but it is important employers take the necessary steps beforehand to be prepared for the change. We also advise that you discuss the change within the law with your employees so that they are aware of how it affects them.

What does this mean to the employee?

As an employee, if you are already part of a workplace pension scheme you may see no difference if your employer already contributes to your pension, although there will now be a compulsory amount put in by the employee.

The scheme means that the minimum contributions are made from the following sources:

	In the first year employees have to put in 0.8% of their earnings, rising to 4% by 2018.
	The employer must pay 1% of the employee's qualifying earnings into the pension, rising to 3% by 2018.
	The government will also contribute 0.2% of the employee's contributing earnings, which shall rise to 1% by 2018.

The minimum amounts can be higher, depending on your employer due to the rules of the new pension scheme. If you are unsure of the amounts then get in touch with us and we will be able to discuss in detail how the change shall apply to you.