Employers Banned From Encouraging Pensions
Opt-Out
As part of the initiative to ensure today’s
employees have enough provision for retirement, the government
has announced a proposed change to its Pensions Bill. The
change prohibits employers from encouraging employees to opt
out of workplace pension schemes by means of incentives. Employers
that simply force employees to opt out of the schemes will also
be penalised.
The penalties will require the employers to pay any arrears
in contributions until the worker is back in the position they
would have been had they not been encouraged or forced to opt
out. They may also face a fine. To limit bogus or ‘frivolous’ claims
from staff, the government have proposed a time limit in which
claims can be made.
The new rules will come into force in 2012, when it will be
compulsory for all employees between the age of 22 and State
Pension age earning more than (currently) £5,035 per annum
to be enrolled in a workplace pension scheme.
