Automatic re-enrolment and re-declaration

Auto enrolment commits employers to a variety of ongoing tasks including automatically re-enrolling any member of staff who may have opted out or ceased active membership of the scheme, and re-declaring their compliance with auto enrolment legislation.

Automatic re-enrolment

Having been automatically enrolled into a qualifying workplace pension scheme (‘QWPS’), eligible jobholders have the right to leave the scheme should they wish to do so – however, employers are required to automatically re-enrol them after a period of time.

Automatic re-enrolment means you must re-assess any eligible jobholder who:

• chose to ‘opt out’ of the scheme during the month-long opt out period that followed auto enrolment,
• left the scheme after the opt out period and ‘ceased active membership’,
• chose to reduce their contribution so that total contributions fell below the minimum required by your QWPS.

If one of these events took place more than 12 months before your ‘re-enrolment date’ (see below) and they qualify as an eligible jobholder, you must automatically re-enrol them back into your QWPS. If the event happened within the 12 months preceding your re-enrolment date you have the option of re-enrolling them if you want to, but you’re not legally required to do so.

Re-enrolment date

Automatic re-enrolment takes place on your re-enrolment date which is ‘about’ three years after either your duties start date or your previous re-enrolment date. ‘About’ may seem a bit vague but, as an employer, you are free to choose the exact date although it must fall within a period of time three calendar months either side of the third anniversary of either your duties start date or previous re-enrolment date.

For example, if your duties start date was 1 August 2020, the third anniversary will be 1 August 2023, which means your re-enrolment date can fall sometime between 1 May 2023 and 31 October 2023.

This six-month ‘window of opportunity’ allows you to choose a re-enrolment date that is compatible with your organisation’s business calendar, for example, you may want it to coincide with a staff pay date or avoid a seasonal peak in activity.

Once you have chosen your re-enrolment date you must re-assess every member of staff on that date. Although you will know from monitoring your employees’ age and earnings on a regular basis who will stay in your QWPS, you must also re-enrol back any employees who have opted out. Having done so, you must advise them accordingly, giving them the opportunity to decide, once again, whether they want to stay in the scheme or opt out of it.

It is not possible to postpone automatic re-enrolment, offering flexibility in the date you choose is designed to cover any need to do so.

Re-declaration of compliance

All employers must re-declare their compliance with auto enrolment legislation every three years, however, whether or not you have to automatically re-enrol staff affects the date by which you have to do so. There are two options:

1. If you are re-enrolling staff, you must submit your re-declaration within two months of your chosen re-enrolment date.
2. If you are not automatically re-enrolling staff, you must submit your re-declaration by the day before the date of the third anniversary of your original declaration of compliance (note: not your re-enrolment date).

Re-declaration of compliance is a mandatory duty and failure to complete it on time could lead to fines and prosecution.

Re-enrolment and re-declaration dates – a quick summary

A duties start date of 1 August 2020 was used earlier in the text to illustrate how the re-enrolment date ‘window’ is generated. Using this same example to summarize a potential calendar of events:

How can One Financial Solutions help you?

One Financial Solutions is here to help you. We can help you plan and implement everything necessary to ensure you comply with the new legislation and fulfil your legal obligations.

If you already have a workplace pension scheme, we’ll review it to make sure it can be used and will recommend any changes that may be needed. If you need a new scheme, we’ll find one for you and, as a truly independent firm of financial advisers, we’ll make sure the scheme we recommend is selected from the entire market and is the one that is best for both you and your staff.

More than that, if you’d like us to administer the entire scheme for you, we can do that too.

So, if you’re looking for specific help about auto enrolment or just want advice on the subject, please call us on 020 3714 9565 or ask us to call you by sending an email to admin@onefinancialsolutions.co.uk.