“Any individual who works under a contract of employment (an employee), or has a contract to perform work or services personally and is not undertaking the work as part of their own business.”

This is a very broad description and you’ll need to make sure you don’t miss anyone.

Many of your employees may need to be automatically enrolled, depending on:

• their age
• their earnings
• whether they normally work in the UK

And other employees can ask to join too.

If your staff have a one-off increase in wages, because they work irregular hours or earn flexible incomes, they should be enrolled the first time* they earn over the auto-enrolment threshold of £192 a week or £833 a month if paid monthly.

Once staff have been enrolled, you must pay regular contributions into their pension scheme (unless they’ve decided to opt out). If the staff member’s earnings fall below £120 a week or £520 a month, you may stop paying contributions unless the rules of the pension scheme they’ve enrolled into requires them to continue.

* Note that under the postponement rules, you can delay enrolling staff into the pension scheme when they first meet the criteria to be an eligible jobholder for up to 3 months.

If you have freelance workers on the business’s payroll with contracts, paying tax and National Insurance contributions, they’ll need to be auto-enrolled. If this isn’t the case, they don’t need to be auto-enrolled.

Not all employees have to be put into a pension scheme automatically, but they can still ask to join. Whether they’re enrolled automatically or not depends on how much they earn, their age and if they normally work in the UK.

If your employees don’t want to be enrolled, they still must be enrolled if they’re assessed as eligible. They do have the option to leave the scheme at any time. If they opt out within 30 days, they’ll be entitled to a refund.

Exceptions

Among the employees you must put into a workplace pension, there are some exceptions. You can choose whether or not to enrol them if:

• they’ve handed in their notice (unless they take it back later)
• they benefit from some kinds of tax protection that applies to the pension scheme
• in the last 12 months they’ve received what’s known as a ‘winding-up lump sum’ from a different pension scheme you’ve offered.

You may need to check with your employees whether any of this applies to them.

If your employee is leaving employment, you may apply postponement to the employee meaning they don’t need to be auto-enrolled up to 3 months taking them after their leave date. You’re allowed under legislation to enrol them if you wish to do so, however, for an employee who’s leaving you’ll need to decide whether it’s worth doing so.

When you submit a data file to us, we check their age according to the end date for that pay period.

When should an employee be auto-enrolled? 

You can upload your employee data for an Eligible employee if they’re aged between 22 and under State Pension age by the pay period end date of the file you’re uploading. There are a number of different times you’ll need to assess your employees’ eligibility – The Pensions Regulator has lots of information to help with this.

Only Eligible employees need to be automatically enrolled into a pension scheme, but all employees aged 16-74 have the right to opt in or join a pension scheme. To make sure these employees understand their rights to opt in or join the pension scheme, you should write to them:

• when you reach your duties start date, or
• when a new starter begins with your company, or
• when an employee turns 16 years old.

Our template letters can be used for this:

• Template letter – to let entitled/non-eligible employees know how to join or opt in to The People’s Pension
• Template letter – to tell your employees you’re using postponement

What happens if a Non Eligible or Entitled employee wants to join the pension scheme?

Non Eligible jobholders:  Require their employer to arrange for them to become an active member of a pension scheme by giving their employer an ‘opt-in notice’. If your employee asks to opt in, you’ll need to contribute to their pension at the minimum contribution level (but you can choose to pay more if you’d like).

Entitled workers: Require the employer to arrange for them to become an active member by giving the employer a ‘joining notice’. If your employee asks to join a pension scheme, you won’t need to contribute to their pension, but can choose to do so if you’d like.

What is an opt-in or joining notice?

It records that the employee requested to join the pension scheme. It’s important that employees assessed as Non Eligible jobholders and Entitled workers send you a valid notice before you add them to the pension scheme.

Both an opt-in or joining notice must be:

• in writing – but doesn’t have to be a formal document. It can be a letter or an email
• signed by the employee submitting it. If it was sent by email, it must include a statement from the employee confirming that they personally submitted the notice.

TPR states opt-in and joining notices must be kept by the employer in their original form for 6 years.

During a file upload, you may see an error explaining the auto-enrolment status of your employee isn’t correct. To solve this, you should check both your payroll and the data file you’re uploading to make sure they contain:

• the correct date of birth
• the correct auto-enrolment status.

Then amend your data file or payroll settings and re-submit your data file to us.

Although your employer can’t change its staging date, it can delay the date it intends to enrol you into its pension scheme by up to three months. This is known as ‘postponement’. Your employer must tell you about the delay in writing. If you want to join the workplace pension scheme before this date your employer must make sure you are able to (you’ll need to contact your employer if you want to do this).

• If your contract of employment ends before the end of the postponement period, your employer doesn’t have to auto-enrol you at the end of your contract. However, you can contact your employer and ask to join the scheme during this period.
• If you’re re-employed, your employer can use postponement again, but only if any previous postponement period has finished.

If you’re unsure when your start date is, we recommend that you speak to your payroll provider.

We’ll expect your employee data by the end of the first pay period. Payment needs to reach us by the 22^nd of the following month.

If you pay your employees weekly, we’ll expect employee data weekly. Similarly, if you pay them monthly, we’ll expect your employee data monthly.

Then send us your employee data regularly

After your first submission, you should send us your employee data every pay period.

We only need to know about postponement choices if The People’s Pension is being used to assess the workforce.

Staging postponement – an employer can postpone assessing their workforce from their duties start date for up to 3 months.

New starter postponement – an employer can postpone assessing their new starters for up to 3 months.

Eligibility postponement – an employer can postpone enrolling someone who has become eligible for the first time, to cope with spikes in earnings. This makes allowances for those individuals who may only become an eligible employee every now and again and saves the administrative duties associated with frequently changing someone’s status.

Eligible

Use this status if an employee:

• earns over £192 per week (equal to about £833 a month or £10,000 a year)
• is aged between 22 and State Pension age
• ordinarily works in the UK.

You must put these employees into a pension scheme and regularly pay into their pension pots. The Pensions Regulator (TPR) sometimes refers to this as ‘type 1’ employees.

Non Eligible

Use this status if an employee:

• is aged between 16 and 21 or between State Pension age and 74
• earns over £192 per week (equal to about £833 a month or £10,000 a year)
• ordinarily works in the UK.

Or

• is aged between 16 and 74
• earns between the lower earnings threshold (£6,240 a year) and £10,000 a year
• ordinarily works in the UK.

A Non Eligible jobholder doesn’t have to be auto-enrolled into a workplace pension. They can ask to opt in to an employer’s pension scheme, and their employer will have to pay into their pension pots on a regular basis. TPR sometimes refers to this as ‘type 2’ employees. Read more about assessing an employee as Non Eligible on our website.

Entitled

Use this status if the employee:

• is aged between 16 and 74
• has earnings less than the lower earnings threshold (currently £6,240 a year / £520 a month / £120 a week)
• ordinarily works in the UK

An Entitled worker doesn’t need to be auto-enrolled. They can ask to join an employer’s pension scheme, but the employer doesn’t need to pay money into their pension pots unless they’d like to. Read more about assessing an employee as Entitled on our website.

What other statuses do we accept?

Contractual Enrolment

This is when employers put all of their employees into a pension scheme, without working out which employees they need to auto-enrol.

Each employee must agree to join the pension scheme and have contributions deducted from their salary, if applicable. This consent is given when they accept the terms set out in their employment contract.

Read more in our guide to contractual enrolment.

Not Known

• if you’ve chosen The People’s Pension to assess the eligibility criteria of an employee (new starter or in postponement period) on your behalf and the employee’s status hasn’t been confirmed yet, or
• if an employee doesn’t have a pension but does have Employee Life Cover/Employee Accident Cover with B&CE.

Not Applicable

Use when an employee is aged under 16 or over 75. This is because auto-enrolment doesn’t apply to them due to their age.

Already in qualifying scheme

Use when an employee has a pension elsewhere, in a pension scheme that is already a qualifying workplace pension scheme for auto-enrolment.. We don’t accept pension contributions for employees already in a qualifying scheme.

You can choose to use postponement on the following dates:

– your duties start date
– the first day of employment for any new employees who join your company after your duties start date
– the date an employee reaches the trigger to be an eligible jobholder after your duties start date (eg when an employee turns 22 years old).

You must write to tell the employees whose auto-enrolment you’re postponing. You’ll have 6 weeks from the date postponement starts to write to them.