The Department for Work and Pensions (DWP) is consulting on plans to make two technical changes to the automatic enrolment process, which will apply to new employers due to become subject to automatic enrolment duties during 2017, and are designed to make the transition easier
The department is seeking views on a change to the automatic enrolment duties trigger set out in legislation for these new employers (known as post-staging employers), and on plans to extend to these employers the option to defer automatic enrolment for their workers (currently this is available only to employers in the staging profile).
DWP says the regulations package on which it is now consulting is being made in advance of the outcome of the 2017 review of auto enrolment, which will look at whether auto enrolment continues to meet the needs of individuals saving for their retirement in the future. This is because the measures need to be in place before the existing provisions in the Employers’ Duties (Implementation) Regulations 2010 start to apply to new employers in April 2017.
The draft regulations are designed to provide certainty about when the auto enrolment duties apply to new employers (i.e. those outside the auto enrolment staging profile). They change the date of the auto enrolment duties trigger, for post-staging employers, to the day on which the first worker begins to be employed by the employer.
A new legislative power is necessary to extend the easement to new employers, including small and micro businesses, which DWP says are the employers likely to benefit most from the ability to have more to time to deal with the official administrative requirements around automatically enrolling a new worker. It is the employer’s choice as to whether they use the easement, and for how long they choose to defer enrolment within the three month window.
The draft regulations also extend an existing compliance easement to new employers, who would otherwise face an increased regulatory burden when automatically enrolling workers for the first time. DWP says it welcomes stakeholder comments on whether these regulations will work in practice to achieve the policy intent of providing a clear and straightforward compliance framework for newly created employers so that they understand when the auto enrolment duties will apply to them.
DWP intends to publish a response to the consultation in March 2017 with the regulations due to come force on 1 April 2017.
The consultation closes on 3 March.
Technical changes to automatic enrolment: Consultation on draft regulations is here.
