The legal duty
Every UK employer must automatically enrol "eligible jobholders" into a workplace pension and contribute towards it.
Who is an eligible jobholder?
- Aged 22 to State Pension age
- Earns over £10,000/year (£833/month, £192/week)
- Works in the UK
Workers outside these bands may still have the right to opt in.
Minimum contributions (since April 2019)
| Employer | Employee | Total | |
|---|---|---|---|
| Minimum | 3% | 5% | 8% |
Contributions are calculated on qualifying earnings (£6,240 – £50,270 in 2024/25) unless you use a certified alternative basis.
Choosing a pension scheme
Most SMEs use one of:
- NEST — government-backed, no charges for employers
- The People's Pension — flexible, popular with payroll software
- Smart Pension — strong tech integration
Your duties
- Assess every worker on each payday
- Enrol eligible jobholders within 6 weeks
- Write to each worker explaining their options
- Re-enrol any opt-outs every 3 years
- Complete a Declaration of Compliance with The Pensions Regulator within 5 months of duties start date
Penalties start at £400 fixed and escalate to £10,000+ per day for large employers.