Auto-enrolment only after probation?

It has been suggested that we only auto-enrol new employees who are eligible into our workplace auto-enrolment pension scheme once they’ve successfully completed their probation period. Is this acceptable? Natasha Crockatt from our payroll department discusses below.

If you require your employees to successfully complete a probationary period before they start working for you on a permanent basis, you can choose to postpone auto-enrolment. However, this is only possible for probationary periods that are no longer than three months.

For example
Andrew starts working for you on 1 July and he has a two-month probation period. He is 25 and earns £26,000 per year so is an eligible employee for auto enrolment-purposes.

You can decide to postpone auto-enrolment until Andrew successfully completes his probation period and his employment on a permanent basis has been confirmed. In this situation, you must issue him with postponement notice. Also, be aware that Andrew may still exercise his right to opt in to your pension. Providing he still meets the auto-enrolment criteria at the end of August when his permanent employment is confirmed, he must be auto-enrolled at that stage.

Pensions auto-enrolment for an eligible new employee can be postponed for up to three months. This is useful if permanent employment is subject to the successful completion of a probation period. You must notify the employee of the postponement in writing.

If you would like Payroll support or have any queries, please contact the team on 01450 372267.