Your auto-enrolment duties for workplace pensions

Your employer duties start on day 1

From the moment you employ your first member of staff, you become responsible for workplace pension duties. This is called automatic enrolment (or auto-enrolment), and it is a legal requirement for all UK employers.

Auto-enrolment means you must automatically enrol eligible workers into a workplace pension scheme and contribute to their pension. These duties apply regardless of your business size, sector, or whether you employ one person or hundreds.

Who must be automatically enrolled

Not every employee will need to be auto-enrolled into your pension scheme. Eligibility depends on three criteria: age, earnings, and work location. If all three conditions are met, you must auto-enrol them.

The lower age limit is 22. The upper limit is each worker's own State Pension age. The increase from 66 to 67 is phased between 2026 and 2028 according to date of birth; check the worker's individual State Pension age.

Check every pay period whether employees cross the £10,000 threshold. If someone's earnings fluctuate (for example, seasonal workers or commission-based roles), they may move in and out of eligibility. You must enrol them whenever they meet all three criteria.

Minimum contribution rates

Once you have enrolled an employee, you must pay at least the minimum contribution rates into their pension. The total minimum contribution is 8% of their qualifying earnings, split between employer and employee.

You must pay at least 3%, and your employee contributes at least 5%. The employee's 5% includes tax relief, so they effectively pay 4% from their net salary if they are a basic-rate taxpayer.

The 3% and 5% split is the legal minimum. Many employers pay more as a staff benefit, for example 5% employer and 5% employee.

What are qualifying earnings?

Contributions are calculated based on 'qualifying earnings', not total salary. Qualifying earnings fall within a specific band set by the government each tax year.

You only pay contributions on earnings within the qualifying earnings band. For example, in 2026 to 2027 someone earning £30,000 has qualifying earnings of £23,760 (£30,000 minus £6,240). Your 3% employer contribution is £712.80 a year (£59.40 a month) and their 5% is £1,188 a year (£99 a month).

Your employer duties

The Pensions Regulator sets out key duties that every employer must follow to comply with auto-enrolment law. These duties cover the entire lifecycle from assessing staff eligibility to ongoing record-keeping.

You must assess every worker to determine if they need to be auto-enrolled. Do this assessment when they start work and at every pay period if earnings fluctuate.

The scheme you choose must be a 'qualifying scheme' - this means it meets minimum requirements set by law. Most workplace pension providers (for example, NEST, The People's Pension, NOW: Pensions) offer qualifying schemes. You can use a master trust, group personal pension, or occupational pension scheme.

You must write to eligible workers within prescribed timescales explaining they have been enrolled, the scheme details, contribution amounts, and their right to opt out. Template letters are available from your pension provider or The Pensions Regulator.

Postponing enrolment for up to 3 months

Postponement allows you to delay auto-enrolment for up to 3 months. This is useful for businesses with high staff turnover (for example, hospitality, retail) to avoid enrolling temporary staff who leave quickly.

If many new starters leave within their probation period, postponement saves you the work of enrolling and unenrolling them. You must give written notice to the employee within prescribed timescales explaining you have postponed their enrolment and when it will happen. You cannot just delay enrolment without notifying them.

Employee opt-out rights

Employees have the legal right to opt out of your pension scheme within one month of being enrolled. If they opt out in time, you must refund all contributions deducted.

If an employee leaves the scheme after the one-month opt-out window closes, they are 'ceasing membership' rather than opting out. In this case, contributions stay in the pension - they do not get a refund.

You must not encourage workers to opt out. It is illegal to induce or coerce workers to opt out (for example, by offering higher pay if they do not join the pension). The Pensions Regulator can issue fines for this.

Re-enrolment every 3 years

Your auto-enrolment duties do not end after initial enrolment. Every 3 years, you must re-assess and re-enrol any eligible workers who previously opted out or left the scheme.

Re-enrolment gives workers who opted out a regular chance to join the pension. Your re-enrolment date is exactly 3 years from your staging date (the date you first became an employer). Set a calendar reminder at least 6 months before your re-enrolment date to prepare.

Penalties for non-compliance

The Pensions Regulator has strong enforcement powers to ensure employers comply with auto-enrolment duties. Penalties escalate quickly if you fail to act.

Register with The Pensions Regulator

Within 5 months of employing your first member of staff, you must complete a declaration of compliance with The Pensions Regulator. This is how you confirm you have set up auto-enrolment correctly.

You will need to provide:

• Your business details (PAYE reference, company number)
• Your staging date (date you became an employer)
• Details of your chosen pension scheme
• Number of staff you have assessed and enrolled
• Confirmation you have written to eligible workers

The declaration takes about 20 minutes to complete online. If you miss the 5-month deadline, you may receive a fixed penalty of £400.

Ongoing administration and record-keeping

After initial setup, you have ongoing duties:

• Check the eligibility of every new employee.
• Re-assess existing staff when their pay changes, for example after a promotion or pay rise.
• Pay contributions by the 22nd of the month after you deduct them (the 19th if you pay by cheque).
• Send contribution schedules to your pension provider.
• Keep records showing you have met your duties; The Pensions Regulator can ask for them at any time.
• Handle opt-out requests made within the 1-month window and refund the contributions.
• Track your re-enrolment date and re-enrol eligible staff who left the scheme.