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Workplace pensions

Financial Conduct Authority does not regulate auto enrolment.

The Pensions Regulator is the statutory regulator of Workplace Pensions. 

The easiest and cheapest way to save for your retirement is by taking advantage of your employer's Workplace Pension. This is a way of saving for your retirement through contributions deducted direct from your wages. To make it easier to save for retirement, the government introduced auto-enrolment. This means employers need to provide a workplace pension scheme and make payments for certain employees.

If you are eligible for automatic enrolment, your employer has to make contributions into the scheme. Most schemes will also provide other benefits, for example, support for your partner if you die. The scheme is arranged by, or on behalf of, an employer and helps eligible employees save for retirement.

In addition to tax relief on your contributions, you also get the benefit of contributions from your employer so, irrespective of the type of scheme offered, the quality of the funds it invests in, or its charges, it usually makes sense to participate. Ignoring it is equivalent to turning down a pay rise.

All businesses are now obliged by law to provide a suitable workplace pension scheme for eligible staff. This is the result of a government initiative to help people who otherwise might not save enough money to live on when they retire.

A percentage of the employees’ salary is paid into a nominated scheme along with employer contributions and builds a pot of money ready for retirement. Like employees, employers have to meet a minimum level of contributions for all enrolled scheme members. Employees can opt out of workplace pensions if they want to, but that means losing out on the contributions employers would make and the tax relief they would get from the government.

Under the current rules the minimum contribution is 8% of qualifying or pensionable earnings (earnings between £6,240 and £50,000). This is made up of 4% from you, 3% from your employer and 1% from the government in the form of tax relief.

Employers need to enrol all employees who:

  • Aren’t already enrolled in a suitable scheme
  • Are aged between 22 and State Pension age
  • Earn more than £10,000
  • Usually work in the UK


The employers enrolment duties start from the date on which a member of staff joins their business. The most commonly offered scheme is a defined contributions (DC) pension in which your financial contributions are invested.

Financial Conduct Authority does not regulate auto enrolment.

The Pensions Regulator is the statutory regulator of Workplace Pensions.

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