Guide to Pension Auto Enrolment

This is an overview of the rules relating to workplace pensions and automatic enrolment. For more comprehensive guidance, please see the website of The Pensions Regulator.


If you are an employer with staff working for you in the UK, the rules regarding workplace pensions and automatic enrolment apply to you.

Rules about influencing the behaviour of your employees and screening new recruits apply earlier, but most of the rules begin on your 'duties start date':

  • If your first worker starts on or after 1 October 2017, his or her start date is your duties start date.
  • Otherwise, check the website of The Pensions Regulator.

Pension Providers

If you don't yet have a pension scheme, you should choose one before your duties start date. The Pensions Regulator's website explains that you should pick a scheme that either has master trust assurance or is regulated by the Financial Conduct Authority. The website also has a list of schemes that are open to small employers.

Once you have enrolled your staff in a pension, you'll need to give information regularly to the pension company. This is different for each pension provider and is explained in Our Guide.

Assessing Your Workforce

During each pay run, the system will automatically tell you if you need to enrol anyone - see our guide on How to Assess Your Staff.

The workplace pension rules define three categories of workers for whom special actions must be taken. In addition, you may have employees who don't fall into any of these categories - e.g. if they are under 16, aged 75 or over, or if they do not work in the UK. Some office holders are also excluded.

Criteria for 2018/19CategoryMain ActionsAlso Note
Aged 22 to State Pension Age, earning over £192/wk or £833/m Eligible Jobholder
  • Enrol them in a qualifying pension.
  • Write to the employee.
  • Make employer contributions.
After being enrolled, the employee can opt-out. For more information, see our Opt-Out Guide.
Aged 16-74, earning over £116/wk or £503/m and not an Eligible Jobholder Non-Eligible Jobholder
  • Write to the employee.
The employee can opt-in.
Aged 16-74, earning no more than £116/wk or £503/m Entitled Worker
  • Write to the employee.
The employee can join the pension but you don't have to make employer contributions.

Pay Reference Periods

Each assessment is carried out over a period called a 'pay reference period', which can be defined in different ways. We've chosen the definition aligned to tax weeks or tax months for these reasons:

  • It is simple to understand.
  • It always includes the pay date.
  • It never crosses tax years, which have different earnings bands.

The system uses this definition of a 'pay reference period' when assessing your staff and when calculating pension contributions. You may need to tell your pension company this when setting up the pension scheme.

Pension Contributions

When you enrol an employee into a pension scheme, either automatically or because they've asked you to do so, this begins a regular series of payments into the pension. These payments are called pension contributions and are calculated as part of each pay run, as follows:

  • Employer contributions, as the name suggests, are an extra cost to the employer.
  • Employee contributions are deducted from the wages. These normally attract tax relief using either Relief at Source or the Net Pay Arrangement.


You can delay some of your duties using postponement. If you use postponement, you must tell your employees in writing. For more information, see the website of The Pensions Regulator.

Automatic Re-enrolment

Every three years, you must look again at anyone who has opted out and assess whether you need to enrol them again. On The Payroll Site, resetting the options on the 'Pensions etc' tab will trigger them to be assessed again.

Keeping Records and Completing a Declaration of Compliance

In addition to the above, you must keep records and complete a declaration of compliance. You can find more information about these obligations on the website of The Pensions Regulator.