â€¦ and as we see a rising number of compliance notices given to companies failing to meet their auto-enrolment duties, it seems that the Government is starting to recognise the difficulties that employers are facing.
More than 1.25 million business will go through the auto-enrolment process over the next three years and as smaller firms approach their staging date the Department for Work and Pensions (DWP) has proposed three key changes to reduce the burden on employers. The consultation period closes on 9 January and the changes are expected to come in during April 2015.
The DWP is proposing to make certain employees exempt from being automatically enrolled or re-enrolled into a pension scheme, namely:
There are also proposed changes to the amount and detail of information that employers have to provide to their staff.
Under the current rules, employers have to send up to five different pieces of information to workers, which creates a heavy administrative burden for the employer as well as being confusing for the employee.
Under the simplification proposals, much of the information will be consolidated into a more generic format that can be used for all employees.
The DWP proposes that employees should receive a minimum level of information that covers:
The proposals to streamline the employee information are optional – if an employer has already begun their employee communications they won't be obliged to switch to the new processes.
The other proposed change of note relates to simplifying the 'quality test' that is applied to existing workplace pension schemes to assess whether or not they meet the standard for a qualifying pension scheme for auto-enrolment.
For more information on the how, what and when of pension auto-enrolment – including how to find out your staging date – please visit our dedicated pages.