Workplace pensions – re-enrolling employees
Every three years, employers have to re-enrol certain employees in the company’s auto enrolment compliant pension scheme. Your re-enrolment obligations are broadly the same as your auto enrolment staging responsibilities. Before you enter the process, it’s worth reviewing how it is running and what it is costing your business.
Here are some questions to help you with the review process:
When should you re-enrol?
Your re-enrolment date can be up to 3 months before or 3 months after the 3rd anniversary of your staging date. This gives you an opportunity to choose a re-enrolment date within this period that works best for you. Your payroll adviser should be able to help you choose the date.
You can’t apply for a postponement under re-enrolment and must have the same re-enrolment date for all the staff you need to re-enrol.
Should your auto enrolment process be run in-house or is it outsourced?
Whatever you chose to do at your staging date, now is a good time to review your payroll auto enrolment solution to check it is still right for you.
Properly trained and resourced in-house payroll staff are a good solution for many businesses. If the size and shape of your business is likely to change in the next 3 years, you may find your payroll team is under or over resourced.
External payroll services are scalable. If your workforce grows or contracts, so will your payroll service, without you having to worry about hiring new payroll staff or making them redundant.
By choosing a full-service payroll provider, you’ll get much more than a data-processing bureau – you’ll get the professional advice you’d expect from a payroll specialist without the cost of recruiting or managing them.
What reports, budget forecasts and plans are in place to help you with the next three years of auto enrolment?
Your duties as an employer under re-enrolment are similar to those under auto-enrolment staging. Staff not currently in the scheme will need to be reassessed to identify who should be automatically re-enrolled and who could opt-in to the scheme. All employees not currently in the scheme will need to be informed of their options and you’ll have to manage opt-ins and opt-outs.
Workforce assessment will form the basis of your auto enrolment budget forecast for the next three years. You may also be affected by the percentage increase in employer and employee contributions which starts on 6 April 2018.
Your payroll adviser should be able to provide cost forecasts based on different scenarios so you can understand how changes in your workforce can affect your budgets. They should also provide a monthly summary of costs so you can compare staffing costs against forecast and make any adjustments necessary.
For help and advice with your auto enrolment payroll solution, please contact Susan Elsdon.