Hiring staff for the summer and pension eligibility

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If you are hiring short term or seasonal workers over the summer, you will need to check on day one if they are eligible for automatic enrolment into a workplace pension.

Even if they only work for the business for a few days, are on irregular hours, or are under the age of 25, employers still need to assess pension eligibility. This assessment must happen on their first day of employment. And if they are eligible for automatic enrolment, they will need to be put into a pension scheme.

Here are some frequently asked questions about seasonal workers and pensions:

How do I work out if staff are eligible for auto-enrolment?

Eligibility for auto-enrolment depends on two factors: the age of your staff, and how much they are paid. Additionally, you must assess each staff member every pay day. This applies whether their pay and hours change, or they leave mid pay cycle.

What happens if I don’t enrol my staff into a pension?

You could face enforcement actions or fines from The Pensions Regulator if you don’t follow auto-enrolment procedures. If you comply late, you may be required to pay your employee’s back-dated contributions as well as your own.

How do I work out pension contributions if my staff are on irregular hours?

The minimum contribution is 3% of earnings from you, and 5% from your staff. You will need to include salary, wages, commission, bonuses, overtime and statutory pay for sickness, maternity, paternity and adoption pay in your calculations.

Sounds like a long and difficult process? It doesn’t have to be.

For any business wanting to make payroll more manageable there are two ways to make life simpler.

Use tools to manage it yourself. The right payroll software, like BrightHR Payroll, will assess staff every pay cycle and calculate contributions. All you have to do is keep things up-to-date. And our payroll and HR software are fully integrated, so it only needs to be updated once. This is made even easier by giving staff on-the-go, mobile-friendly access to their payslips, tax forms, and personal information.

Let someone else manage it for you. Fully outsourced options, like ourselves take all the time and stress out of auto-enrolment.