Government consults on new pension arrangements
The Department for Work and Pensions is consulting on draft regulations concerning the practical arrangements for employers to enroll workers into workplace pension schemes from 2012, the information that employers will have to provide and the arrangements for opting-out following automatic enrolment.
The Pensions Act 2008 represents a key element of the Government’s attempts to get more people to save for retirement with the primary aim being to enable and encourage more people to build up a private pension income, to supplement the basic State Pension. From 2012, the Act’s provisions include:
Employers automatically enrolling eligible workers into a qualifying scheme (which can include the new Government sponsored ‘personal accounts’ scheme), unless a particular worker is already in a qualifying scheme, or actively decides not to be in such a scheme;
Employers contributing a minimum of 3% to an eligible employee’s workplace scheme, with employees contributing 4% and around 1% coming from tax relief;
Introducing a low-cost means of saving (the personal accounts scheme) for employees without access to a good quality work based pension scheme.
The Consultation Document contains the draft Pensions (Automatic Enrolment) Regulations and commentary on them. The consultation, which comes to an end on 3 June 2009, concerns:
The practical arrangements by which employers will be required to enrol workers into a workplace pension scheme, including the circumstances and arrangements for postponement of automatic enrolment, where appropriate;
The information which employers are required to provide to their workers and to pension schemes; and
The arrangements by which individuals can opt out of pension saving following automatic enrolment.
This provides summary information and comment on the subject areas covered. Where employment tribunal and appellate court cases are reported, the information does not set out all of the facts, the legal arguments presented and the judgments made in every aspect of the case. Employment law is subject to constant change either by statute or by interpretation by the courts. While every care has been taken in compiling this information, we cannot be held responsible for any errors or omissions. Specialist legal advice must be taken on any legal issues that may arise before embarking upon any formal course of action.
