Automatic enrolment jargon buster
Automatic enrolment terms and jargon explained.
Under automatic enrolment regulations, you need to work out who to put into a pension scheme. On your staging date, you have to work out how much each of your employees earn and how old they are. This will identify what you need to do, and is sometimes referred to as ‘assessment’.
Paying money into a pension scheme is known as ‘making contributions’. You must pay money into the pension scheme on a regular basis.
This describes which basis of the employee’s earnings are used for calculating pension contributions.
Contributions can be based on the standard components of pay – salary, wages, commission, bonuses and overtime, as well as statutory pay for sickness, maternity, paternity and adoption.
Or you can use other definitions of earnings – find out more on The Pensions Regulator’s website.
This includes your employee details and pension contribution amounts. You can transfer employee data to The People’s Pension by uploading a file – either manually or transferred automatically through your payroll software (if your payroll provider supports this).
Alternatively you may be able to manually key in the data.
All new members of The People’s Pension receive joiner information about their pension, plus how much will be contributed each pay period, how they can ask to leave (opt out) and other member information.
It also provides login details for the member’s Online Account, where they can check the value of their pension pot and manage their choice of investment funds.
This is how often an employer pays their employees (eg weekly or monthly).
Under automatic enrolment rules, this is the period of time over which earnings are to be measured. For example, if an employee is paid weekly, the pay period would be one week and if they are paid monthly, the pay period would be one month. The minimum pay period is one week.
To align with the pay frequency used to calculate PAYE and National Insurance contributions, the pay period can be a tax week, or a tax month.
If you have temporary employees, you may choose to delay working out who you need to put into a pension scheme.
You can only postpone automatic enrolment from:
- your staging date
- an employee’s first day of employment
- the date an employee first becomes eligible for automatic enrolment.
The date your automatic enrolment duties start. You can check your staging date on The Pensions Regulator’s website.