Auto Enrolment - FAQ's
1. What is auto enrolment?
New legislation relating to workplace pensions requires employers to automatically enrol specific groups of their workers into a pension scheme. For the University, the implementation date for auto enrolment is 1 July 2013.
The effective date is determined by the size of an employer, with larger employers being required to start the process from October 2012. By 2017 all employers will be required to comply with the legislation.
2. What does this mean for you?
If you are already a member of one of the University’s pension schemes there will be no change for you as a result of auto enrolment.
The University’s pension schemes include the University of St Andrews Superannuation and Life Assurance Scheme (S&LAS), the Universities Superannuation Scheme (USS) and NERC. Additionally a new pension scheme will be available from 1 July 2013 called NOW: Pensions.
If you do not currently pay into a pension scheme the University will be required, by law, to automatically enrol you into a workplace pension if you are aged between 22 and State Pension Age (currently 65) and have earnings above the statutory minimum amount of £833 per month. If you are not automatically enrolled you will have the opportunity to join a scheme if you wish (see Question 6).
If you are auto enrolled, you may opt out of the scheme, but every three years employers are required to re-enrol all eligible workers who, at that time, are not members of a qualifying scheme.
3. Is everyone being auto enrolled into a workplace pension?
No. This depends on whether you meet certain criteria. From 1 July 2013 you will be auto enrolled into a workplace pension if you:
- are not already in a workplace scheme;
- are aged 22 or over;
- are under State Pension age (currently 65);
- earn more than the statutory minimum amount of £833 per month; and
- work or usually work in the UK.
4. If I'm working outwith the UK or I've been seconded to the UK from overseas, does auto enrolment apply to me?
If you are working outwith the UK but are being paid by the University then auto enrolment does apply to you.
If you are on secondment to the University from overseas and you are being paid by your overseas employer then auto enrolment does not apply to you as you do not normally work in the UK.
5. If I meet the criteria, when will I be auto enrolled?
If you meet the criteria in Question 3, you will be auto enrolled into a workplace pension scheme with effect from 1 July 2013.
6. If I’m not auto enrolled can I join a pension scheme?
If you do not meet the criteria for auto enrolment, you can join a workplace pension scheme if you wish. The pension scheme that you can choose to join will depend on which category of worker you are. This is detailed in Question 7.
7. Which pension scheme will I be auto enrolled into?
This depends on which category of worker you are. The table below shows which pension scheme the various categories of staff will be auto enrolled into, or can choose to join if you do not meet the criteria for auto enrolment.
|
Category of Worker |
Workplace Pension Scheme |
|---|---|
|
Contracted employees with fixed hours in Grades 1 to 5 |
New employees will be auto enrolled into NOW: Pensions. Employees who have previously opted out of S&LAS will be auto enrolled into NOW: Pensions (see Question 9) or can choose to join S&LAS instead at any time.
|
|
Contracted employees with fixed hours in Grades 6 and above (except USS re-employed pensioners and flexible retirees)
|
New employees will be enrolled into USS Employees who have previously opted out of USS will be auto enrolled back into USS. |
|
Casual/Bank employees |
Employees who meet the criteria for auto enrolment will be auto enrolled into NOW: Pensions
|
|
Re-employed Pensioners |
Employees who meet the criteria for auto enrolment will be auto enrolled into NOW: Pensions.
|
|
Atypical workers |
Workers who meet the criteria for auto enrolment will be auto enrolled into NOW: Pensions. |
For information on NOW: Pensions see Question 9.
Details of USS and the benefit structure are available on the USS website.
8. What will I get from my workplace pension when I retire?
That depends. If you are automatically enrolled into NOW: Pensions or choose to opt into NOW: Pensions the amount you receive when you retire will depend on the growth of your fund during your period of membership.
If you are Graded 1 to 5 or equivalent and you elect to join the University of St Andrews Superannuation and Life Assurance Scheme (S&LAS), which is a final salary scheme, you can find out more about the benefits that would be payable upon retirement by referring to the .
If you are Graded 6 to 9 or equivalent and are auto enrolled or choose to join the Universities Superannuation Scheme (USS) you can find out more about the benefits payable from that scheme on the USS website.
9. What is NOW: Pensions?
NOW: Pensions is a private company who provide an auto enrolment facility. It is supported by ATP, Denmark’s leading pension provider.
NOW: Pensions is a low cost pension scheme which attracts low charges and is portable.
The Government will also pay into your NOW: Pensions in the form of tax relief. This means some of your money that would have gone to the Government as tax goes into your pension instead.
10. How much will I pay into NOW: Pensions?
Both you and the University will pay a percentage of your earnings into the scheme as set out in the table below. The University is going to increase the amounts being paid over the next few years in line with the Government’s minimum standards.
The contribution rates are as follows:
|
Date Range |
Your contribution (including the tax relief) |
University's contribution |
|---|---|---|
|
April 2013 to September 2017 |
1% |
1% |
|
October 2017 to September 2018 |
3% |
3% |
|
October 2018 onwards |
5% |
5% |
Please note the University will match employee contributions, this is higher than the Government Statutory minimum for employers.
11. How do I opt out of the pension scheme?
If you wish to opt out of NOW: Pensions you can do this online at www.nowpensions.com.
If you wish to opt out of USS you can download an opt out notice from USS which you should complete and return to Lisa Harley, Pensions Administrator.
If you wish to opt out of S&LAS you can download an opt out form from the Pensions Website. The completed form should be returned to Lisa Harley, Pensions Administrator.
12. If I opt-out, will you increase my salary to compensate?
Auto-enrolment regulations require that an employer cannot incentivise people to opt-out of a pension scheme by paying salary in lieu of pension contributions. This means that, legally, we are not able to pay you the employer contributions if you choose to opt-out of the scheme. If you are considering opting-out, you are strongly recommended to take professional pensions advice.
13. If I opt out, can I rejoin at a later date?
Yes, you can rejoin the relevant workplace pension scheme at any time. To do so, contact NOW: Pensions in writing either by sending a letter which has to be signed by you or you can email pensions@st-andrews.ac.uk but you must include the wording "I confirm I am personally submitting this notice to join a workplace pension scheme".
14. I am paying into a personal pension already, can I continue with this?
Yes, it is possible to have both a workplace pension and your own personal pension.
15. Will I receive an annual statement?
You will receive a statement each from NOW: Pensions showing how much money has gone into your pension post and it is performing.
16. I'm too young to start thinking about pensions?
You are never too young to start saving towards your future. Remember you could have many years of retirement and you will need an income. A workplace pension is one way to provide that income. Usually the longer you pay into a pension scheme the better the benefits will be.
If you still have a question, you can contact Lisa Harley on e-mail pensions@st-andrews.ac.uk or telephone ext 2546.
Further information is also available from: