October 1st saw the government implement some changes for workers. For instance, the National Minimum Wage for those under 25 went up to £6.95 per hour and the Apprentice hourly wage rose to £3.40 per hour.
For some workers, it also meant that they were automatically enrolled into a workplace pension by their employer. If you are wondering how a workplace pension will affect you, we have answered some of the most frequently asked questions in our handy FAQ guide…
Who qualifies for a workplace pension?
Your employer will need to enrol you into a workplace pension if you’re already not in one, are aged between 22 and under the state pension age. To qualify, you also need to earn more than £10,000 per year and your role needs to be based within the UK.
What happens when you’re automatically enrolled?
Before you get automatically enrolled into a workplace pension, your employer must write to you detailing their pension scheme. In the letter, they must tell you the date which they added you to the pension scheme and who runs it. They must also detail how much you’ll pay into the scheme alongside information on their own contribution. Further information on how you can leave the scheme and if tax relief applies to you should also be detailed in this written notice.
How much do you contribute to a workplace pension?
The amount which you pay towards you pension depends on what type of workplace pension scheme you are part of and whether you’ve been automatically enrolled or if you have joined voluntarily. If you have been automatically enrolled, the minimum amount you must pay is 0.8% of your qualifying earnings, which will rise over time to 4% by April 2019.
How much does your employer have to contribute to your workplace pension?
If you have been automatically enrolled into a workplace pension, your employer must contribute at least 1% of your qualifying earnings which will rise to 3% by April 2019. The government also pays a contribution of 0.2% of your qualifying earnings if you have been automatically enrolled.
What can an employer not do?
When you are enrolled into a workplace pension, your employer can’t unfairly dismiss or discriminate against you for being in a pension scheme. They are also unable to encourage or force you to opt out.
Do you still make contributions during maternity & other parental leave?
You and your employer will continue to make pension contributions if you are getting paid during maternity leave. If you are not getting paid, you employer still has to make pension contributions in the first 26 weeks of your leave.
How do you leave a pension scheme?
If you have been automatically enrolled into a pension scheme, your employer should have wrote to you detailing how you can leave the scheme if you wish. If you choose to opt out within a month of your employer adding you to the scheme; you’ll receive the money back which you have already paid in.
How do you re-join a pension scheme after you have opted out?
If you have previously chosen to leave a pension scheme, you can opt back in at any time by writing to your employer. Your employer doesn’t have to accept you back into their workplace pension scheme if you’ve opted in and then opted out within the past 12 months.
Where can you seek further information from about pensions?
For full details on workplace pensions, please visit the Department For Work & Pensions website or alternatively, you can call the Pension Information Line on 0345 600 1268.