My employee earns below £10,000pa, how does the pension work?
We are afraid this will still affect you even when an employee earns under £10,000. The government has
decided that EVERY employer in the country will be involved, even where an employee is paid below the
threshold of £10,000 you must still correspond with the employee and the Pensions Regulator. An employee who falls into this category is a Non Eligible Job Holder and the following actions must be taken:
– Your employee must receive the correct statutory communication within the enrolment window
detailing their options.
– The pay will need to be assessed each month for auto enrolment.
– Your employee has the option to join the pension scheme at any point, should she request this
the pension scheme must be in place by the end of the month in which she/he has made the
request.
– Your employee will need to reassessed for automatic enrolment every three years.
If your employees pay exceeds the £833 gross per month or £192 per week threshold in any pay period they
will need be automatically enrolled in to a pension scheme in the pay period this occurs. Your employee will then remain in the scheme (even if the pay then falls below the threshold). After your employee has been automatically enrolled she/he will have the option to opt out of the scheme. As the employer you will be required to pay a contribution into the pension at this point.