The Pensions Regulator have advised they are “working with HM Treasury and the Department for Work and Pensions to feed into the Coronavirus Job Retention Scheme’s central guidance on the pensions element of the grant. The guidance below addresses areas where some employers have asked for further clarity.”
Employers Duties
Your auto enrolment duties continue as normal during the Covid-19 pandemic, these duties include re-enrolment and re-declaration.
You should also continue even if you have furloughed staff.
New Employers
If you are a new employer you should still assess staff and if eligible put them into a pension scheme.
You may also use the postponement process which will postpone your enrolment duties and pension contributions for up to three months.
Re-enrolment
The Pensions Regulator have said that they “will continue to write to you with information and support on how to carry out your re-enrolment duties and complete your re-declaration of compliance, recommending that you assess your staff for re-enrolment on the third anniversary of your staging date or duties date.”
You cannot use postponement at re-enrolment. If it is however your 3rd anniversary of your staging date or the duties start date and you are struggling to meet your duties due to Covid-19 you may choose a date up to 3 months after the anniversary to assess your staff.
Continuing Pension Contributions
Unless a member of staff asks to reduce their pension contributions or opt out of their workplace pension, employers and employees must continue to make contributions as required by the scheme at the correct time.
Staff may request to reduce their pension contribution or opt out but employers must not encourage this.
If a staff member redcues their contribution below the statutory minimum or chooses to opt of the scheme they must be put back into the scheme at the next re-enrolment date if they:
- Meet the criteria for re-enrolment.
- Opted out or ceased active membership more than 12 months before the re-enrolment date. If they have opted out or ceased active membership within the 12 months before the re-enrolment date you can choose to re-enrol them, but you don’t have to.
You must pay any deductions from wages into the scheme, deductions must not be used for any other purpose.
Difficulty Making Contributions?
If the Coronavirus pandemic has affected your cashflow and you’ll now struggle to make the required contributions, you should contact your provider. Ideally the sooner you contact them the better to try and explore a payment plan or extension to the payment dates.
CJRS and Pension Contributions
If you make a claim for a CJRS grant to cover the lower of 80% of furloughed worker’s salary or wage or £2,500 per month, you may claim the statutory minimum employer pension contribution on those wages also.
If you have any payroll queries, please contact Avanti 01473 558866. We’re happy to help – modern accountants with traditional values.
Reproduced from The Pensions Regulator