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Topic: Pay and pensions

letter for workers already in a qualifying pension scheme
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Letter for workers already in a qualifying pension scheme

Letter for workers already in a qualifying pension scheme

Where you already have a qualifying workplace pension scheme in place for your workers and they are active members of that scheme, other than writing to them using our letter, there is no action for you to take in connection with auto-enrolment.

Qualifying scheme

If some or all of your workers are already active members of your workplace pension scheme, and provided it is a qualifying scheme, then the automatic enrolment provisions will not affect those individuals. In order to be a qualifying scheme, it needs to meet or exceed the minimum standards set by the government. It must be an occupational or personal pension scheme, tax registered and satisfy certain minimum requirements which differ according to the type of pension scheme, but which essentially set a minimum benchmark for a worker’s entitlement to contributions or benefits. A minimum level of contributions must be made if it’s a defined contribution scheme, which includes group personal pension schemes - the total minimum contribution must be at least 8% of qualifying earnings, or it must meet the minimum requirements by a process called certification. Alternatively, it must provide a minimum rate at which benefits will build up if it’s a defined benefit scheme. Your pension provider should be able to give you further information and advice on this. Even if your scheme does not currently qualify, you may be able to change the scheme rules or amend the terms of the policy or contribution rates so that it can be used. However, if you do intend to do this, you’ll need to first check that what you’re proposing for scheme amendment doesn’t breach workers’ contracts of employment. Otherwise, there may be a need for workers to consent to the relevant changes.

Letter provisions

If your existing scheme is a qualifying one, then you can use our Letter for Workers Already in a Qualifying Pension Scheme to advise the relevant workers that auto-enrolment doesn’t affect them. Always ensure you tailor the letter with the correct information for your circumstances - there are a number of square brackets in our draft and you will need to choose the relevant sentences that apply.

 

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