Automatic re-enrolment (Third year anniversary)
My version of the documents put together by the pension regulator (and will be the
basis of my article for newsletter/website) copy of their wording is attached at the
end of this document for comparison.
Automatic enrolment (a reminder)
The Government introduced a new requirement whereby all employers (not just
public sector) must provide, and pay into, a pension scheme that meets set
requirements- the LGPS meets these requirements.
Automatic enrolment dates were set by HMRC depending on the size of the PAYE
as at 1 April 2012 with set dates from which that employer must comply with the
rules of the new system.
What did this mean for LG employers?
From the employers staging date the employer had to make sure that all qualifyingi
employees had been brought into the pension scheme even if they had previously
opted out unless the employer had chosen to use transitional delayii.
Under Auto enrolment the employer must not have any part in the route for members
to opt out.
Re-Enrolment (3 year Anniversary)
Every three years from the employers individual staging date, the employer is
required to bring back into the pension scheme anyone who satisfies the conditions
(see footnote 1) and who has opted out. And this note is designed to assist
employers who are approaching this three year anniversary.
The requirements also cover anyone who has elected to move to the 50:50 scheme,
they must be brought back into the main scheme every three years- there is nothing
to stop anyone choosing to move back to the 50:50 scheme following the reenrolment date.
The Pension Regulator allows you to omit from re-enrolment anyone who has opted
out (or into the 50:50 scheme in the 12 months leading up to your re-enrolment date,
in my wording I have assumed employers will wish to honour such late elections.
Why? The Government are keen that all employees do benefit from an occupational
pension and just because someone opted out early in a job they thought would be
short term, they should not miss out (the Government have described this as
‘harnessing positive inertia’.
Choose your re-enrolment date
As you approach the third anniversary of your staging date you can choose to move
your re-enrolment date by up to 3 months either side, so if your original staging date
was 1/4/2013 you could choose any date between 1/1/16 and 1/7/16.
Who to auto enrol (and who is exempt), staff to be re-enrolled will be anyone who is
not currently a member of the scheme who meets the criteria under footmark 1
except:

Anyone covered by transitional delay at original staging date (these member
will be due to be brought in on 1 October 2017)

Anyone who had opted out in the 12 months immediately prior to the reenrolment date
What action do I need to take?
Decide what date to use as your re-enrolment date within 3 months of your 3rd year
anniversary of your staging date.
A)
Identify all members who are:
o Between 22 and SPA and are not in the scheme
o Check their earnings meet the required level
o Check if they opted out in the 12 months before chosen date
Also identify any members who elected to enter the 50:50 scheme more than
12 months previously and carry out same tests as above.
B)
Write to all members being Auto enrolled, the letter must state, that they are
being Auto Enrolled, the date they have been brought into the pension
scheme, the pension scheme, the amount of contributions, the amount paid
by the employer, tax relief given at source. This must have been completed
within 6 weeks of the re-enrolment date but in reality would be preferable
approximately 6 weeks before the date of effect.
C)
Provide list of affected members to LPFA
D)
Prepare for significant number of affected members to opt out and possibly
complain
Opting out (or into the 50:50 section)
Following the chosen date and receipt of the information the LPFA will write to
each member with details of the scheme and will provide the opt out route
which will be electronic, if a member opts out notification will be provided to
the employer automatically.
Re-declaration
Once you complete your actions for re-enrolment you need to complete the redeclaration of compliance with the Pension Regulator. If you have members that
have been re-enrolled you must complete the declaration within 2 months of your
selected re-enrolment date, if you do not have any members to be re-enrolled you
must complete the declaration the day of the third anniversary of your original
staging date.
i
ii
Between age 22 and State Pension Age, and earning greater than £833.33 per month (£10,000 per annum)
If the employer used transitional delay they needed to contact the member to inform them the intention to
honour their previous decision to opt out.