Workplace pension scheme - automatic enrolment
Q. What is auto-enrolment?
We are all living longer and the Government has introduced this scheme because of concerns that many people will not have sufficient income to live on at retirement. By introducing this legislation all eligible workers nationally will have to be enrolled into a workplace pension and can then choose whether to opt out or stay in. It is aimed primarily at businesses which don't currently provide a pension scheme to ensure that we all save for our retirement in addition to the state pension.
If you are already in one of our workplace pension schemes, auto-enrolment does not affect you.
Some workers at the University were not previously able to join one of our workplace pension schemes. This has now changed though and from 1 July 2013 we will be enrolling eligible workers (see 'Who does it affect' section for information on eligibility) into a workplace pension scheme if they are not already in one. If eligible, you will pay a percentage of your salary into the pension scheme and Edinburgh Napier University will also pay a contribution too. You will also benefit financially from tax relief from the government. It's a hassle free way of saving while you earn.
Even if you're not being automatically enrolled into our workplace pension, you can still ask to join.
Q. Who does it affect?
If you are already in one of our workplace pension schemes, the Lothian Pension Fund or Scottish Teachers Superannuation Scheme, auto-enrolment does not affect you.
This applies to those who aren't already in a workplace pension and who meets all of the following criteria:
• you earn above £833 per month
• you are aged between 22 and state pension age
• you work, or usually work, in the UK
• you work under a contract of employment ** (an employee), or have a contract to perform work or services personally (i.e. you cannot send a substitute or sub-contract the work) and is not undertaking the work as part of their own business.
** A contract does not have to be in writing. It can be a verbal contract between the employer and the worker. The terms of employment can be implied, rather than explicitly stated. Multiple contracts with one individual will require a separate assessment. Where a transfer occurs under the TUPE regulations, transferred-in workers should be viewed as being under a new contract and the new employer should therefore assess that individual's worker status at the point of transfer.
Q. What happens next?
Every month from July 2013 we will assess everyone against the criteria based on age, earnings and existing pension membership. This will determine which category of worker you are and what happens next.
Categories of Workers
Under lower earnings threshold (£5,824)
Between £5,824 and £10,000
Over earnings trigger for automatic enrolment (£10,000)
† Thresholds effective from 6 April 2016 - Based on 'Qualifying earnings', but calculated pro-rata for Pay Reference Period
.e.g. > £833.33 per month
* SPA = State Pension Age
¥ Who work, or ordinarily work, in the UK (excluding the Channel Isles and Isle of Man)
We will write to anyone who is affected by a change in circumtance on a monthly basis, this will be sent to your home address. The following will be some common scenarios:
1. You are already contributing to one of our workplace pension schemes, auto enrolment will not affect you.
2. You have been eligible to join one of our workplace pension schemes since your appointment but because you chose to opt out from the pension scheme following appointment. If you are an eligible jobholder on 1 July 2013 or thereafter, we will delay the date at which we need to automatically enrol you to 1 October 2017. This is called 'transitional delay' (see section below which explains this in greater detail)
3. You have not in the past been eligible to contribute to one of our workplace pension schemes and you do not meet the new earnings and age criteria, e.g. are not an eligible jobholder, we are not required to auto-enrol you in the pension scheme although you can always elect to join.
4. You have not in the past been eligible to contribute to one of our workplace pension schemes but you now meet the new earnings and age criteria we will auto-enrol you into one of our workplace pension schemes.
5. You are a new start casual worker. We will assess you once you have worked for the University for three months. If you meet the eligibility criteria you will be automatically enrolled into one of our workplace pension schemes.
Auto-enrolment is a continual process so from the 1 July onwards we will need to monitor all workers on a monthly basis against the criteria. The University's HR Connect system will keep a track of all these changes and will automatically trigger your enrolment into the workplace pension scheme.
What happens if I am eligible for automatic enrolment?
If you do qualify for automatic enrolment you do not need to do anything. We will write to you to let you know that you have been automatically enrolled into the pension scheme and when your payments will begin. These will be shown on your payslip.
You will be notified that you have the choice to opt out. If you opt out within 3 months of auto enrolment you will receive a full refund through Payroll. If you opt out after this date you are only entitled to a refund if you have been in the scheme for less than 2 years, in this instance the refund will be processed by the pension provider.
What is Transitional delay?
This is a rule which allows the employer to delay the point at which they need to automatically enrol workers into a pension scheme. It only applies to eligible job holders in post on the 1 July 2013 who have previously opted out from one our workplace pension schemes. The key point is that these workers were given the option to join previously but chose not to or opted out after joining and the transition rule recognises that a choice has already been made. In these cases the auto- enrolment date will not be until the 1 October 2017.
I don't want to be in the pension scheme. Can I opt out in advance?
No. Under auto-enrolment legislation the rule is very clear that no-one can opt out until they have been put into the pension scheme. Because our staging date for auto-enrolment is 1 July 2013 staff in this position will have to wait until 1 July 2013 in order to be able to opt out. If you are in this position it is advisable to opt out as early as possible from this date in order that we can ensure a quicker refund of any deductions already taken.
What pension schemes does the University offer?
The University has two contractual pension schemes which you will be enrolled into depending on the kind of job that you do.
• Professional Services and Research staff will be enrolled into the Lothian Pension Fund (www.lpf.org.uk )
• Academic staff will be enrolled into the Scottish Teachers Superannuation Scheme (www.sppa.gov.uk )
The pension provider will send you information about the scheme that you are being enrolled in. For further details regarding contributions rates etc. please see the Universities Pensions page.
What happens if I'm eligible but I work for more than one organisation?
Please contact Payroll in HR at firstname.lastname@example.org or (0131 455 3733) to talk about your individual situation.
I don't meet the eligibility criteria, can I still join the scheme?
Yes, you can still opt into the workplace pension scheme if you like. You can do this by emailing Payroll at email@example.com to confirm you wish to join a workplace pension. You would pay a percentage of your salary into the pension scheme and Edinburgh Napier University will also pay a contribution too as outlined previously. You will also benefit financially from tax relief from the government.
Please contact Payroll in HR firstname.lastname@example.org for more information.
Lothian Pension Fund website at www.lpf.org.uk
Scottish Teachers Superannuation Scheme website at http://www.sppa.gov.uk
You can also see the government information at: https://www.gov.uk/workplace-pensions.