Automatic enrolment (or auto enrolment) was introduced by the Government to help people save for retirement through a work place pension scheme. Under this law employers must automatically bring their ‘eligible workers’ into a pension scheme. The employer must also pay money into the scheme towards their workers’ pensions. By October 2018 all existing employers must offer a workplace pension scheme to ‘eligible workers’.
The LGPS is a qualifying scheme under auto enrolment rules.
Different types of workers
Under auto enrolment law, workers are split into 3 different groups depending on how much they earn and their age. The groups are:
- eligible jobholders
- non-eligible jobholders
- entitled workers.
‘Eligible jobholders’ are workers who earn more than the minimum earnings threshold, are between 22 and state pension age, and work in the UK.
‘Entitled workers’ are not automatically brought into the LGPS, but can choose to join the scheme.
Opted Out or Joined the 50/50 Section?
If you have ‘opted out’ or joined the 50/50 section of the LGPS, your employer is legally required to bring you back into the scheme every 3 years. Once you have been brought back into the scheme you can opt out again, or re-join the 50/50 section.
If you are either a ‘non-eligible jobholder’ or an ‘entitled worker’, your employer must bring you into the scheme if you become an ‘eligible jobholder’.
Your employer may choose not to automatically bring you into the LGPS if:
- you ‘opted out’ of the LGPS within 12 months from when you will be brought back into the scheme.
- you have given notice of your resignation or retirement, or you have been given notice of dismissal
- your employer believes you hold lifetime allowance protection, such as Primary, Enhanced or Fixed Protection