WHEN ARE DIRECTORS’ EXEMPT FROM AUTOMATIC ENROLMENT DUTIES?

Are you a director and unsure whether auto enrolment applies to you?

Auto enrolment does not apply when a company or an individual are not considered an employer.  If you meet one of the following criteria then duties are not owed,

• You are a sole director company, with no staff
• Your company has a number of directors, none of whom have an employment contract, and no staff.
• Your company has a number of directors, only one of whom has an employment contract, with no staff.
• Your company has ceased trading.
• Your company has gone into liquidation
• Your company has been dissolved.
• You no longer employ people in your home (cleaners, nannies, personal care assistants etc).

For information about employment contracts please go to employment status on the GOV.UK website.

If one of the above does apply and you receive a letter from The Pensions Regulator regarding auto enrolment then you need to inform them you are not an employer.  This can be done using an on-line form and you will need the following, letter code, PAYE reference and Companies House number (if you have one).

Should any circumstances change so auto enrolment applies e.g. if a member of staff or at least 2 directors with contracts of employment started working for you, then you have duties in respect of those staff and are an employer.  As such you will need to notify the Pensions Regulator of this change even if none of the said staff meet the age and earnings criteria for auto enrolment.

If the Pensions Regulator find that an employer has provided false or misleading information to evade auto enrolment then this will be considered when taking action against the employer in the future.

Source: The Pensions Regulator