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What you need to know about upcoming pension changes
October 16, 2023
The Pensions (Extension of Automatic Enrolment) Act 2023 received Royal Assent in September 2023. The new Act allows changes to be made to the provisions of the automatic enrolment scheme into workplace pensions.
A reminder of the current rules
Currently, employers must auto-enrol all workers into a workplace pension scheme in the following circumstances:
Employers may delay the automatic enrolment by up to 3 months past the worker’s start date.
Workers are entitled to opt-out of automatic enrolment but can choose to opt back in at any time.
What’s likely to change?
The Department for Work and Pensions is expected to commence a consultation this Autumn on prospective changes. A previous review suggested the following changes take effect:
These recommendations could be implemented along with further changes as well, e.g. possibly lowering the automatic enrolment age to 16.
The idea behind these possible changes is to get younger workers with lower earnings in the practice of saving for their pension from an earlier point in their careers. Due to this, even with a general election looming, it is anticipated that changes to the automatic enrolment provisions will be made because such provisions will very likely have cross-party support.
Top tips to get ready for the likely changes
If you need any advice on the above, please contact Nicole Brendel, or a member of our employment law team in confidence here or on 02920 829 100 for a free initial call to see how they can help.
To speak to one of our experts today, please contact us on 02920 829 100 or by using our Contact Us form for a free initial chat to see how we can help.
