By law, on 6th April 2018, employers are required to increase the amount of minimum pension contributions into their staff’s automatic enrolment pension scheme. The Employer’s contribution will rise to at least 2% and employees’ will contribute 3%. The minimum contribution levels will rise again on 06th April 2019, with employer’s paying a minimum of 3% towards the pension and staff – 5%.

Employers do not need to take any action if they don’t have any staff in a pension scheme for automatic enrolment, or if they are already paying above the increased minimum amounts. These increases don’t apply to staff who asked to be put into a scheme that the employer doesn’t have to pay into.

If we provide payroll services for you – the increase should be simple to do and our payroll provider will be ready to calculate and deduct the adjusted contributions. If you complete your own payroll – you need to check that your payroll software can support the changes.

Pension schemes should already be making changes to support the increases and will communicate this, however it is still the employer’s responsibility to deduct the right amount of pension contributions.

Your pension scheme may be able to support you in communicating these changes to your staff – they may provide you with template letters, notes, etc. There is no legal requirement for employer’s to write to their staff, but it is a good practice and something you may consider doing.

If you require help and advice with any of the above changes, please do not hesitate to contact us on 01227 277667.