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Legal update - Auto-enrolment – three years on

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21 July 2016

We are now at the halfway stage of auto-enrolment. Having initially started in 2012, with the largest employers being required to put a qualifying workplace pension scheme in place for their employees, the new rules are now beginning to impact on the UK’s smaller employers, which includes many legal practices.

Over the last couple of years, we have helped many legal practices to meet their auto-enrolment obligations. We have found the general awareness of the new rules and employer responsibilities to be very good. Whilst auto-enrolment can place new obligations and additional financial costs on employers, most appear to understand why this has come about and have been quite accepting of their new obligations.

So far then, auto-enrolment appears to have been a success amongst employers and employees alike. Over 57,000 employers are now staged for auto-enrolment and around 5.5 million employees have been enrolled into a workplace pension. Disciplinary action from the Pensions Regulator for employers not fulfilling their duties has been low, and a recent survey conducted by the Department of Work and Pensions found that, of all those employees enrolled in 2013 and 2014, only 10% opted out.

Having said that, the next few years have the potential to be the most testing for auto-enrolment. Despite being halfway through the auto-enrolment time frame, only 3% of the total amount of employers expected to stage for auto-enrolment have done so and there are still 1.7 million employers yet to stage, as well as around 4.5 million employees yet to be placed into a workplace pension scheme.

The new rules are now affecting the UK’s smallest employers, and they will now also be expected to offer a workplace pension scheme to their employees.

Three years in, and auto-enrolment appears to have been relatively straightforward so far, but there will still be plenty to think about, especially for some of the smaller practices who may not have given the matter their full attention as yet.

If you would like to speak to us regarding auto-enrolment in your practice, we would be more than happy to help.

Andy Harris - Associate Partner
Andy Harris
Associate Partner Contact details