Get ready for compulsory pensions23.12.2009
The Pensions Act 2008 contains provisions which will make it compulsory (from 2012) for an employer to enrol qualifying workers aged between 22 and the state pension age who earn more than a de minimus amount (currently set at £5,035 per annum) into a pension scheme and to make contributions to the scheme.
The employer will be required to contribute a minimum of 3 per cent of salary and the employee will be required to contribute a minimum of 4 per cent of salary, up to a maximum of (currently) £3,600 per annum.
There will be substantial fines for failure to comply with the new regulations. Clearly, there are likely to be many changes to the provisions between now and the planned implementation date of 2012, but this is a good time to start thinking through the potential impact of the new regime on your business.