This is when you give up some of your salary in return for a non-cash benefit from your employer. These can be in the form of childcare vouchers or in this case pension contributions. When you accept a salary sacrifice scheme you will pay less National Insurance, this is because your overall pay is lower. Your employer will also benefit from salary sacrifice as they will not have to pay employer National Insurance contributions.
You can ask your employer to carry out a calculation to show how salary sacrifice would affect your take home pay.
Salary sacrifice is regulated by HM Revenue & Customs. You can find more information and guides on their website: www.hmrc.gov.uk/specialist/salary_sacrifice.htm.