Publishing the results of its consultation – Workplace pensions automatic enrolment: simplifying the process and reducing burdens on employers – the DWP has also confirmed that employers no longer need to enrol staff the employer knows to have protection against the Lifetime Allowance. Further contributions for these employees would invalidate the protection and cause large personal tax bills.
Employers at their staging date will no longer need to enrol staff who have come out of the company pension within the preceding 12 months.
Communications have also been simplified as a result of the consultation.
Hargreaves Lansdown head of corporate pension research Nathan Long says: “Ironing out these kinks in the system goes a long way to ensuring auto-enrolment is a success long after the biggest companies have staged. The largest employers have paved the way, but often with well-resourced HR and finance teams to rely on. These tweaks will make it easier for smaller employers to remain compliant and give many employees their crucial first step to saving for retirement.”
