Auto Enrolment

We are receiving a number of questions on auto-enrolment around the subject of sole directors and husband and wife directors where there is no additional staff. The following notes might be of assistance:

Sole Directors

  • If you are the sole director and there are no other staff working for you, the company does not have automatic enrolment duties.

  • If you do not receive a letter from The Pensions Regulator regarding auto enrolment there is no action required from you

  • If a letter is received, as a sole director with no employees you will be exempt from auto enrolment however an email or letter should be sent to The Pensions Regulator explaining that you have no duties under auto enrolment. This provides The Pension Regulator with an audit trail

Husband and wife as directors

  • If no one else is working for the company, it will depend on their roles and if they have employment contracts, as to whether the company has automatic enrolment duties or not.

  • If both are directors:

    • The company will have automatic enrolment duties for both if both have employment contracts.

    • The company will not have any automatic enrolment duties if only one has an employment contract or neither has.

If one is a director and the other is not:

  • The company will have automatic enrolment duties for the person who isn’t a director.

  • If both have contracts of employment, the company will also have automatic enrolment duties for the person who is a director.

What do I need to do if none of my staff are eligible jobholders?

1. You will receive a letter from the Pension Regulator stating your staging date and asking for you to nominate a contact individual. This must be done online directly with The Pension Regulator.

2. At the staging date a letter must be issued to all staff informing them of the auto enrolment staging date and explaining that they may choose to join the auto enrolment scheme. The employer is only obliged to contribute for employees who fall under the non-eligible category.

3. If no employees wish to join the scheme then there is no requirement at this stage to establish a scheme with a pension provider

4. Within five months of staging date a Declaration of Compliance must be completed with the Pension Regulator. This is completed online.

5. Assessment of age and salary must continue out on a monthly basis to ensure that all workers are categorised correctly.

John BaxterComment