Auto-Enrolment Employer Duties

A complete guide for UK employers on workplace pension auto-enrolment requirements. Whether you’re setting up for the first time or need a compliance refresher, this guide covers everything you need to know.

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What is Auto-Enrolment?

Auto-enrolment (also called automatic enrolment) is a UK government initiative requiring employers to automatically enrol eligible workers into a workplace pension scheme and make contributions.

Key facts:

• Introduced in 2012, now covers 21.7 million employees
• Applies to all UK employers with at least one worker
• Mandatory – you cannot opt out as an employer
• Enforced by The Pensions Regulator (TPR)

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Your Core Duties as an Employer

1. Assess Your Workers

You must assess every worker to determine their category:

Category	Age	Earnings	Your Duty
Eligible jobholder	22 to State Pension age	Over £10,000/year	Must auto-enrol
Non-eligible jobholder	16-21 or SPA-74	Over £6,240/year	Right to opt in
Entitled worker	16-74	Under £6,240/year	Right to join

2. Choose a Pension Scheme

You must choose a workplace pension scheme that meets certain requirements:

• Must be a qualifying scheme (meets minimum standards)
• Options include NEST (government-backed), master trusts, or private providers
• Must be registered with The Pensions Regulator

3. Auto-Enrol Eligible Workers

For every eligible jobholder, you must:

• Enrol them into your scheme within 6 weeks of their eligibility date
• Cannot require them to take any action to join
• Must provide them with information about the scheme

4. Pay Contributions

Minimum contribution rates (as a percentage of qualifying earnings):

Contributor	Minimum Rate
Employer	3%
Employee	5% (including tax relief)
Total	8%

5. Complete Your Declaration of Compliance

You must declare your compliance to The Pensions Regulator within 5 months of your duties starting.

See our Declaration of Compliance guide →

6. Maintain Ongoing Compliance

Auto-enrolment is not a one-time task. Ongoing duties include:

• Assessing new workers
• Re-enrolling opted-out workers every 3 years
• Keeping records for 6 years
• Paying contributions by the 22nd of each month

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Auto-Enrolment for Small Businesses

If you’re a small business owner, auto-enrolment applies to you too. Even with just one eligible employee, you have the same duties as larger employers.

Common Questions from SMEs

Do directors need to be auto-enrolled?

Directors without an employment contract generally don’t need to be auto-enrolled. However, directors with a contract of employment who meet the eligibility criteria must be enrolled.

What about part-time workers?

Part-time workers are assessed based on their annualised earnings. If they earn over £10,000 per year (or would if their earnings were annualised), they’re eligible for auto-enrolment.

Do zero-hours contracts need auto-enrolment?

Workers on zero-hours contracts must be assessed each pay period. When they meet the earnings threshold and age criteria, they become eligible for auto-enrolment.

What about temporary or seasonal workers?

The same rules apply. You can use postponement (up to 3 months) for new starters, which can help manage seasonal workforce variations.

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The Compliance Checklist

Use this checklist to ensure you’re meeting all your auto-enrolment duties:

Initial Setup

• Chosen a qualifying pension scheme
• Assessed all workers
• Auto-enrolled eligible jobholders
• Sent enrolment information to employees
• Set up payroll to calculate and deduct contributions
• Completed Declaration of Compliance

Ongoing Duties

• Assess new workers within 6 weeks
• Pay contributions by the 22nd of each month
• Keep records for 6 years
• Process opt-in requests within one month
• Complete re-enrolment every 3 years
• Re-declare compliance every 3 years

Communication

• Written to eligible jobholders about enrolment
• Written to non-eligible jobholders about opt-in rights
• Written to entitled workers about their rights
• Informed workers who opt out about re-enrolment

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What Happens If You Don’t Comply?

The Pensions Regulator has significant enforcement powers:

Stage	Action	Penalty
Warning	Compliance notice	None (but must act)
Fixed penalty	For ignoring compliance notice	£400
Escalating penalty	Continued non-compliance	£50-£500 per day
Serious breach	For deliberate non-compliance	Up to £10,000 per day

In H2 2023, TPR issued 27,938 fines to employers.

Read our full guide on fines and penalties →

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Help Your Employees Understand Their Pension

While auto-enrolment ensures employees are enrolled, understanding is a different matter. Research shows:

• Only 15% of employees truly understand how pensions work
• 57% don’t know how much they need for retirement
• 65% identify financial stress as a significant concern

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Key Resources

Resource	Description
The Pensions Regulator	Official guidance and compliance tools
NEST	Government-backed pension scheme
MoneyHelper	Free pension guidance for employees
Pension Wise	Free guidance for over-50s

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Next Steps