The Department for Work and Pensions (DWP) has said that it is to draft regulations for consultation on exceptions to employer duties for those who choose to enrol all new workers into a pension scheme regardless of age or earnings.
By 2018 all employers must enrol workers aged between 22 and pensionable age who work in the UK and earn more than £9,440 a year into a workplace pension scheme.
The roll-out of auto-enrolment started in October 2012 for the largest firms and is currently being extended to medium-sized and smaller businesses, with the smallest firms joining over the next four years.
However, following a recent consultation on exceptions to employer duties, the DWP has said that people contractually enrolled into workplace pension schemes who cancel their membership may not have to be automatically enrolled when they become eligible jobholders for the first time, even if they only recently left the scheme.
This is because respondents to the consultation said that it is “frustrating for the individual and an unnecessary administrative burden” and the DWP agreed that, where employers provide workplace pensions as good or better than auto-enrolment minimums it “can see that there is limited value in forcing the employer to go through a similar exercise almost immediately if the person cancels”, adding that there is a strong case to address this double handling”.
However, the department added that the legal framework would not permit any exception under automatic enrolment to apply to contract joining and that it is up to the individual to resolve this with their employer as an employment issue.