1. If a company has three directors and no other employees, do they need to set up an auto enrolment scheme?
They can choose whether to apply the auto enrolment duties or not. So, they don’t need to set up a scheme. All the other duties and safeguards will apply as usual.
2. Does a non-UK employer have any duties in respect of employees in the UK?
If the contract of employment places the employee in the UK, the employer will have to assess that employee even if the employer is based overseas.
There is more information on assessing a worker in the automatic enrolment detailed guidance.
3. What are the options if an employee is affected by the tapered annual allowance, and the total contributions to the auto enrolment scheme are greater than their available annual allowance for the current year?
There are three main options:
4. Can an employer offer a flexible benefits package, which means other benefits can be offered instead of auto enrolling in the scheme?
Yes. But care must be taken. The employer must have a legitimate purpose for offering the flexible package; they can not be seen to be inducing their workers to opt out or cease membership. The Pension Regulator covers this in its regulations under paragraphs 26-27 and example 3 of Safeguarding individuals - automatic enrolment detailed guidance for employers The Pensions Regulator
5. What happens to auto enrolment pension contributions during parental leave?
If a member of an auto enrolment scheme goes on parental leave, they can continue to pay contributions during their parental leave. During the period of paid parental leave, individual contributions will be based on the actual earnings the individual is receiving. Employer contributions will be based on the level of earnings immediately before parental leave.
The information provided is based on our current understanding of the relevant legislation and regulations and may be subject to alteration as a result of changes in legislation or practice. Also it may not reflect the options available under a specific product which may not be as wide as legislations and regulations allow.
All references to taxation are based on our understanding of current taxation law and practice and may be affected by future changes in legislation and the individual circumstances of the investor.