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Pensions auto-enrolment


From October 2012, all employers will be legally required to automatically enrol eligible staff into a pension scheme and pay minimum employer contributions.
This is a government measure implemented to reflect the fact that we are living longer and saving too little to support ourselves in retirement.
Employers will need to ensure that their HR and payroll departments are properly prepared so that they do not fall foul of the new law.
It may be necessary to review contracts of employment and current benefit arrangements, to see if changes need to be made and whether consultation on pensions is required.
The auto-enrolment will be phased in over a 4-year period. Employers will have a ‘staging date’ when they have to begin the auto-enrolment process, depending on how many employees they have, which is fixed by HMRC records. There will also be a minimum level of contributions that both employees and employers will have to invest.
Sarah Naylor, who heads Atherton Godfrey’s Employment Law Team said: “This is quite a complex area and my advice to employers is that if they are at all unsure of their obligations, they should seek advice as soon as possible – preparation and awareness of pension auto-enrolment is the key”.

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