5 July 2012

Auto-enrolment Pensions - Snippet #5

Who does it apply to?
The legislation talks about "jobholders". What does that mean? The main category includes employees between the ages of 22 and State Pension Age, who ordinarily work in the UK, and earn over £8,105. These are "eligible jobholders" and employers' obligations fully apply to them, although individuals can choose to opt out.

Secondly we have "non-eligible jobholders". These are people not covered above who are between 16 and 22, or State Pension Age and 75, and who earn at least £5,564. These people are not auto-enrolled but can choose to opt in - which means that the employer must make their pension contributions.

Thirdly we have "entitled workers". These earn less than £5,564 and are aged 16-75. They do not belong to the auto-enrolment regime but there are still some employer obligations re pensions.

Of course, people move between those categories. When someone reaches 22 for example, they have to be auto-enrolled, and there are rigid processes to follow within defined timescales.

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