Understanding pension auto re-enrolment

Auto re-enrolment, an essential function of retirement saving, occurs every three years.

Auto re-enrolment requires employers to re-enrol eligible employees who have previously left/opted out of the workplace pension scheme or reduced their contributions below the minimum requirements.

Re-enrolment is an essential part of workplace pension schemes, ensuring that employees continue to save for their retirement.

2025 is a re-enrolment year for many mid-sized to large employers.

Here is a guide to help you navigate the re-enrolment process seamlessly and meet your legal duties.

Planning ahead

As you approach your re-enrolment date, it is vital to plan ahead. Here are a few steps to help you get started:

Review your employee records – Identify any employees who are not members of your pension scheme and any who are in the pension scheme but with contributions below the minimum requirements. This will identify which employees are eligible for re-enrolment. It also allows you to decide whether to make use of any of the exemptions available for example: employees who have opted out in the last 12 months; employees with various Lifetime Allowance Protections; and employees working their notice period.
Talk to your payroll and pension providers – make sure they are aware of your re-enrolment date and ensure all parties are aware of their role in the process.
Set a re-enrolment date - determine the date on which you will carry out re-enrolment. This date should be within a six-month window that starts three months before and ends three months after the third anniversary of your previous re-enrolment date. If you are unsure of your re-enrolment window, use the Pension Regulator’s (TPR) date checker.
Communicating to employees – employees who are re-enrolled must be sent certain information within six weeks. If your provider issues communications on your behalf you might want to review a copy of the letter. Consider whether you want to issue any other communications to employees ahead of your re-enrolment date to make them aware that they may be re-enrolled.
Check for compliance issues – if you use certification, check whether you still have a valid certificate. Employers using anything other than Qualifying Earnings to calculate contributions (eg basic pay) need to re-certify their scheme at least every 18 months. Spot-check some contributions to make sure they are being calculated correctly.

Actioning re-enrolment

Once you reach your re-enrolment date it’s time to take action:

Re-enrol eligible employees - on the chosen re-enrolment date, ensure that all eligible employees are put back into the workplace pension scheme. This includes updating payroll systems and notifying your pension provider of the changes.
Notify employees - inform employees that they have been re-enrolled into the pension scheme. Ensure they are sent the required information including details of their contributions, the opt-out process, and any other relevant information.
Process any opt-outs – refunds will need to be paid to any employees who opt out of the pension scheme. Complete your ‘Declaration of Compliance’ and keep records - you will need to complete your ‘Declaration of Compliance’ for TPR within 5 months of the 3rd anniversary of your last re-enrolment date. Maintain accurate records of the re-enrolment process, including the list of re-enrolled employees, communications sent, and any opt-out requests. These records will be essential for demonstrating compliance and future re-enrolment cycles.

Auto re-enrolment is important for maintaining a compliant and effective workplace pension scheme.

By planning ahead, checking your processes, and communicating effectively with employees, you can ensure a smooth and successful re-enrolment process.

Remember re-enrolment is a legal duty, and if you don’t act in time, you could be fined.

If you have any questions or need assistance with the auto-re-enrolment process, please get in touch.