Just before or just after your staging date, you have to advise your employees that you have chosen a pension scheme, who it is with and whether they will be automatically enrolled or have the option to opt-in or join, depending on the category of worker that they fall in to. You also have to tell them whether you are postponing, the tax relief method and what their individual contributions will be from their own salary and from you as an employer, amongst other information.
It is a legal requirement to provide this information to your employees and must be done within six weeks of your staging date but getting it done early can save you time and hassle and not put you under pressure once your AE scheme has started. Let’s be honest, there will be plenty to keep you busy!
There are several ways to produce these letters:
From your payroll software â€“ possibly the simplest option (providing your payroll software is capable). By producing communications through your payroll software you can file all your correspondence and records in one place and cross reference against individual employees quickly and easily
From your pension provider â€“ Pension providers have a wide range of letters to suit all situations. Obviously, if they produce all of these communications for you this will save you a lot of hassle. However, do check that your pension provider has this capability – don’t just assume they will. Keeping track and ensuring that all employees have received the appropriate communications (which is ultimately your responsibility) is also more difficult using this option.
Manually, possibly with the help of your accountant, payroll bureau, financial advisor or AE advisor. There are templates available from The Pensions Regulator or your pension provider. However, if you fill these in manually it is quite labour intensive; and if you get help from a third party there will usually be a cost implication.