Government publishes response to auto-enrolment consultation

The government has published its response to a consultation on exceptions to the employer duties around pensions auto-enrolment.

The consultation, Technical changes to automatic-enrolment: public consultation on draft regulations and other proposed changes, which was published in March 2013, described proposals to insert a clause in the Pensions Bill to provide regulation making powers to exclude employees of a prescribed class or description from the scope of auto-enrolment.

Government

The government’s first response to the consultation, published in October 2013, summarised the main points made by respondents with regard to proposed technical changes to auto-enrolment.

Its second response, Technical changes to automatic-enrolment: government response to the consultation on exceptions to the employer duties, published on 12 February, detailed a range of proposals to dis-apply the statutory obligation on employers to put certain groups of workers into pension savings.

The government said that the responses to the consultation put forward a strong case for it to permit employers not to enrol:

  • Employees with tax-protected status for existing pension savings.
  • Employees who are on the brink of leaving employment.
  • Employees who have given notice of retirement.
  • Employees who cancelled pension membership after being contract joined.

Next steps

The government said the next step is to develop proposals for workable exceptions that provide real value for both employees and employers, and to bring forward final proposals in due course.

The government’s response stated: “The current arrangements for automatic-enrolment were created and subsequently refined to make them as simple as possible to operate and communicate. 

“Even so, there are some aspects that remain less straightforward for employers and their workers.

“We want, therefore, to offer employers some more flexibility, so that in a limited number of specific situations, affecting only a small number of workers, employers are not obliged to go through the process of automatic-enrolment

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“This will also benefit individuals for whom pension saving is not appropriate, who will not have to go through the process of being automatically enrolled and having to opt out.

“Accordingly, we consulted on a range of proposals to dis-apply the statutory obligation on employers to put certain groups of workers into pension saving.”