Rates are for 2017/18
When you start preparing for pensions automatic enrolment, one of your first priorities will be to assess your workforce. You must fully understand which of your employees are eligible for auto enrolment so that you comply with the new legislation.
In order to achieve compliance you will need to categorise your workers into one of three eligibility categories:
1. Eligible Jobholders
This category describes workers that are eligible for automatic enrolment. It applies to employees who are between the qualifying age of 22 and state pension age with earnings that are above the auto enrolment threshold; which currently stands at £10,000.
3. Entitled worker
2. Non-Eligible Jobholders
This category represents employees who are aged 16 to 74 and earning below the £10,000 auto enrolment threshold OR employees aged between the minimum age of 16 and 21 (i.e. under 22) or from state pension age to 74 who are earning above the auto-enrolment threshold. Non-eligible jobholders will not be auto-enrolled; however they can opt into a qualifying scheme where both you and the employee make contributions.
This category covers workers who are aged between 16 and 74 and are earning below the lower threshold; which is currently £5,876. Even though this group of workers will not be automatically enrolled, it is your duty to provide them with information about their right to join a pension scheme. It is worth noting that if an employee that comes under the criteria of this category does want to join a pension scheme it doesn’t need to be a qualifying scheme that complies with auto enrolment and you have no obligation to contribute to it.