– questions from our clients, answered:
QUESTION: “We use casual workers only and usually pay them cash – are we exempt as employers for Auto-Enrolment?”
ANSWER: No you are not automatically exempt. Without a PAYE reference, the staging date for casual staff will be 1 April 2017. However, If you have no casual workers at that time, you are exempt up until the moment you take on a casual worker after this staging date; the workers will fall into auto enrolment and full compliance applies. You will have to set up an auto-enrolment pension scheme so they can stage from this date (when their work commences) and will need to inform and write to these workers.
FURTHER INFORMATION – Casual Staff & Auto Enrolment:
Many employers in the UK rely on casual workers when business needs call for it; either a business is so busy that more hands are needed or so quiet, that staffing hours would not even warrant part-time workers.
Many people choose casual work in order to better control their working hours around other commitments, family, school, caring responsibilities etc. Flexibility though comes at the cost of a reliable income and guaranteed hours.
With the introduction of Auto Enrolment, where employers and employees contribute to the employee’s pension, it is less than clear how this works with casual staff and will very much depend on individual circumstance. In a nutshell though the following points should help to give an idea of where you stand (but please speak to your accountant, financial adviser or the regulatory authority to be sure you are meeting your obligations – the fines for non-compliance can be devastating): If, as an employer, you have been given your staging date and you have casual workers on your payroll who:
- Are between the ages of 22 and State Pension Age;
- Earn £10,000 a year or more;
- Ordinarily work in the UK; and
- Are not already enrolled in an employer’s pension scheme
…you DO have to automatically enrol them. Irrespective of the duration of a casual worker’s contract, if you they are aged between 22 and state pension age, you’ll need to check each time you pay them whether their earnings are over £192 a week (£833 a month). If their earnings are over this amount, you’ll need to provide a pension scheme for them. This includes anyone who starts working for you after your staging date as well.
- Be aware of your staging date (if not notified, seek advice!)
- Decide early, who in your business will be handling the auto enrolment process.
- Check status of all employees to see who needs to be enrolled.
- Be sure you payroll process can deal with auto enrolment.
- Tell all staff about auto enrolment.
- Do contact a professional if you are unsure about your duties and responsibilities.
We have a fully trained team and software that understands and works with the requirements of auto enrolment, please feel free to get in touch to arrange a chat to set your mind at ease.