The Pension Regulator on 14th April 2020 issued guidance about automatic enrolment pension contributions.
The full details of the changes are set out below.
TPR publishes COVID-19 pension guidance for employers
A summary of what it sets out is noted below;
- The current crisis has not changed the employer’s duties and responsibilities with regard to auto enrolment pensions.
- Re-enrolment of staff cannot be postponed subject to a window of three months in which this can be done.
- New employers must enrol staff can postpone enrolment and therefore delay making pension contributions for a period of 3 months.
- The obligation to make the payments, both the employer and employee, is not affected by the current crisis.
- Notwithstanding staff can opt to increase or reduce contributions or indeed opt out of the scheme if they choose.
- The employer must not encourage or induce employees to opt out.
- The current crisis and Job Retention scheme does not require the payroll administrator to make any changes to existing pension arrangements or processes.
- The current scheme rules and contributions will apply albeit on the furlough salary.
- If an employer wishes to reduce the level of contribution from a level in excess of the statutory minimum there are important employee consultation requirements to be met if you have more than 50 employees. These usually centre upon consultation and a minimum period of 60 days.
- However, the Pension Regulator will not take action if these are breached provided;
- Staff are furloughed and the decrease relates to furloughed staff only
- The reduced level only applies during the furlough period
- You write to staff to explain the changes
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