Who needs to be included in your Auto Enrolment Pension Scheme?

Wednesday 29 April 2015

Nathan Clarkson of Goddard Perry, an independent pension solution provider and founder member of NAEA ARLA Master Trust, explains who is classed as a worker under pension auto enrolment legislation.

So who is affected by Auto Enrolment? Well put simply all ‘workers’ aged 16 to 74. Not all will be auto enrolled, but all are subject to the employer duties. However the question of whether or not someone is a worker is not as simple as it may at first seem.

Any individual is likely to be deemed a worker if they ordinarily work in the UK and either:
• work under a contract of employment
or
• have a contract to work personally, cannot sub-contract and are not undertaking the work as part of their own business.

The employer is responsible for determining who is a worker and in cases where an individual is not classed as a worker, the reason should be recorded in case of regulatory inspection.

Employers have a range of responsibilities to workers under auto enrolment and safeguards are in place to protect employees; employers must not induce workers to opt out or cease membership of the pension or indicate their decision will affect the outcome of any recruitment process. Employers found to be in breach will be subject to fines.

Where can I get help?

The Pensions Regulator has provided guidance on checking which individuals should be classed as workers and detailed guidance here

For those companies that register with the NAEA ARLA Master Trust a number of educational bulletins will be issued automatically during the six months up to staging. These bulletins will focus on ensuring that the company has considered the right things in advance.