Template letters for employers to explain auto enrolment increases to staff
03 October 2017
The following steps need to be implemented before 6 April 2018 and also need to be repeated before 6 April 2019. The Pensions Regulator (TPR) recommends that you start this process early, as this may take some time.
1. Work out which increases apply to you.
- If you are unsure you should check your scheme documents or speak to your pension scheme provider
2. Work out which staff it applies to.
- You need to make the increases in contributions for ALL staff who you had to put into a pension scheme and which you pay into, including any new staff you put into this scheme. The increases do not apply to staff who asked to be put into a scheme that you don’t have to pay into
3. Make sure the way you calculate contributions and pay them to the pension scheme is ready to apply these increases from 6 April 2018.
- If you use a payroll provider or payroll bureau you should speak to them to check everything is in place to process the increases
- If you pay your staff yourself using payroll software, you must make sure it is set up to process the increases
- If you are unsure what to do speak to the software provider
- If you use your own process to pay your staff, you will need to ensure the increases are implemented
- If you use HMRC basic payroll tools you will need to put in place a process to ensure the increases are implemented
You can use the Regulator’s online contributions calculator to help work out your costs for each member of staff.
4. Depending on what you have already agreed with your pension scheme, they may also be making the necessary changes to process the increases and may contact you nearer the time to tell you what is happening and what you need to do.
Telling your staff about the increases
You should let your staff know about the increases. TPR has an example letter template you can amend.
For further details, visit TPR’s website.