Pension auto-enrolment duties for UK employers
What every UK employer must do to meet pension auto-enrolment obligations under the Pensions Regulator.
Since the Pensions Act 2008 came into force, every UK employer has a legal duty to automatically enrol eligible workers into a qualifying workplace pension scheme. Pension auto-enrolment is policed by The Pensions Regulator (TPR), and non-compliance penalties start at £400 fixed and escalate to £10,000 a day for large employers. This guide covers the categories of worker, the contribution minimums, and the declarations TPR expects.
Who must be enrolled
Workers fall into three categories based on age and earnings.
| Category | Age | Earnings test | Action |
|---|---|---|---|
| Eligible jobholder | 22 to State Pension age | > £10,000 / year | Auto-enrol, employer contributes |
| Non-eligible jobholder | 16-21 or SPA-74, or earnings £6,240-£10,000 | n/a | Can opt in; employer contributes |
| Entitled worker | 16-74, earnings <= £6,240 | n/a | Can opt in; employer not required to contribute |
The earnings test is applied at each pay reference period, not annually. Someone who earns £900 in one month is an eligible jobholder for that month even if their annual pay is far lower.
Minimum contributions
| Source | Minimum % of qualifying earnings |
|---|---|
| Employer | 3% |
| Employee | 5% (4% net + 1% tax relief) |
| Total | 8% |
Qualifying earnings are pay between £6,240 and £50,270 in 2024-25 (the lower and upper earnings limits for NIC). You can use a higher base such as basic pay or total pay; if you do, alternative thresholds apply under the certification rules.
The first-day routine
When a new worker joins:
- Assess them on their first pay date
- Enrol eligible jobholders into the scheme within six weeks
- Issue a statutory letter within six weeks of enrolment
- Allow opt-out within one month for a full refund
- Run the contributions through the next payroll
You may postpone assessment for up to three months from the worker’s start date. This avoids enrolling short-term temps who would leave before the first contribution.
Re-enrolment every three years
Approximately every three years you must:
- Choose a re-enrolment date within a six-month window
- Re-assess all workers who previously opted out
- Re-enrol those who are again eligible jobholders
- Submit a Re-declaration of Compliance to TPR within five months
Failure to re-declare results in fixed penalties even if you have no eligible workers.
Choosing a scheme
Most small employers use one of the master trusts:
- NEST (the government-backed default)
- The People’s Pension
- Smart Pension
- Aviva Workplace Pension
- Now: Pensions
Compare on contribution methods (relief at source vs net pay), default investment fund performance, employer charges and integration with your payroll. See our existing auto-enrolment pension page for the underlying mechanics.
Penalties for non-compliance
| Trigger | Penalty |
|---|---|
| Failure to comply notice ignored | £400 fixed |
| Daily escalating penalty (1-4 employees) | £50/day |
| Daily escalating penalty (5-49 employees) | £500/day |
| Daily escalating penalty (50-249 employees) | £2,500/day |
| Daily escalating penalty (250+ employees) | £10,000/day |
| Wilful non-compliance | Criminal prosecution |
Final reminders
Auto-enrolment cuts across PAYE Real Time Information and pension contributions in your bookkeeping. Get the workflow right once and it runs itself. The Pensions Regulator guidance for employers is the authoritative source for limits and process. See pricing for payroll that talks directly to your pension provider.