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Employment contracts and pay

Worker categories for auto-enrolment

Explains the three worker categories for auto-enrolment — eligible jobholder, non-eligible jobholder, and entitled worker — and what each means for employer duties. Covers edge cases including agency workers, directors, and workers with multiple jobs.

UK-wide
Guide summary

Explains the three worker categories for auto-enrolment — eligible jobholder, non-eligible jobholder, and entitled worker — and what each means for employer duties. Covers edge cases including agency workers, directors, and workers with multiple jobs. Why worker categories matter Not all workers have the same auto-enrolment rights. The Pensions Act 2008 creates three categories based on age and earnings.

  • Eligible jobholder: Age 22 to State Pension age, earning above £10,000/year, working or ordinarily working in UK. Must be auto-enrolled.
  • Non-eligible jobholder: Age 16-21 or State Pension age to 74 earning above £10,000/year, OR age 16-74 earning £6,240 to £10,000/year. Can opt in; employer must contribute.
  • Entitled worker: Age 16-74, earning below £6,240/year. Can ask to join scheme; employer need not contribute.
  • Directors: Directors without employment contracts are not workers for auto-enrolment purposes unless they have a contract of employment.
  • Agency workers: The party paying the agency worker is the employer for auto-enrolment purposes (usually the agency, not the hirer).
  • Annual earnings trigger: £10,000 per year (2025/26 and 2026/27)
  • Frozen since: 2014/15 tax year
  • Set by: Annual statutory order (Automatic Enrolment (Earnings Trigger and Qualifying Earnings Band) Order)
On this page
UK-wide

Why worker categories matter

Not all workers have the same auto-enrolment rights. The Pensions Act 2008 creates three categories based on age and earnings. Your duties differ for each category, so you must correctly classify every worker in your PAYE scheme.

Eligible jobholders: must be auto-enrolled

Workers who meet all three criteria — aged 22 to State Pension age, earning above £10,000 per year, and working in the UK — are eligible jobholders. You must automatically enrol them into your pension scheme.

You assess eligibility based on each pay reference period. If a worker's earnings are irregular (for example, commission-based or seasonal), they may move in and out of eligibility. You must enrol them whenever they meet all three criteria in a pay period.

Non-eligible jobholders: can opt in

Non-eligible jobholders fall into two sub-groups:

  • Workers aged 16 to 21 or State Pension age to 74 who earn above £10,000 per year
  • Workers aged 16 to 74 who earn between £6,240 and £10,000 per year

You do not have to auto-enrol non-eligible jobholders, but if they ask to opt in, you must enrol them and pay employer contributions. You must write to them explaining their right to opt in.

Entitled workers: can join, no employer contribution required

Workers aged 16 to 74 who earn below £6,240 per year are entitled workers. If they ask to join your pension scheme, you must allow them in. However, you are not required to pay employer contributions for entitled workers.

You must still write to entitled workers to tell them about their right to join the scheme.

Edge cases

Agency workers: The party paying the agency worker is the employer for auto-enrolment. This is usually the agency, not the business hiring them. If you hire through an agency, check who is responsible for the pension — it should be specified in your agency agreement.

Directors: Company directors without an employment contract are not 'workers' for auto-enrolment purposes. They are not eligible to be auto-enrolled. Directors who do have an employment contract are assessed like any other worker.

Multiple jobs: Assess each job separately. A worker who earns £6,000 from you and £6,000 from another employer is not an eligible jobholder with either employer (neither job reaches £10,000). Each employer assesses only the earnings they pay.

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