How to Prepare For New Pension Rules in April
Workplace pension contributions are set to increase starting from 6 April 2019. Minimum contributions for employees will increase from 3% to 5% under the new rules, while employers will see their contributions go up from 2% to 3%.

An employee earning approximately £27,000 would normally contribute about £500 into their pension, but that amount would increase to £850 after the new rules. Eligible employees are automatically enrolled into their workplace scheme but may choose to opt out and will get back any money already paid in. However, opting out would mean missing out on tax benefits and employer contributions.
The table here shows the minimum contributions that employers must pay starting from 6 April 2019:

The new pension rules apply for employers with staff automatically enrolled in a pension scheme. As an employer, it is your responsibility under the Pension Act 2008 to make the minimum contribution and your staff will need to make up the difference. For example, if you contribute 4% then your staff will need to contribute 4% to meet the minimum requirements. Employees won’t need to contribute at all if their employer covers the total minimum contribution.
How to Prepare for the New Pension Rules
There’s not much time left before the new pension rules are set to start. Here’s what you need to do to make sure that you comply with all the rules before 6 April 2019.
- Determine which increases apply: It is important that you adhere to all the new pension rules. Start by checking your scheme documents to find out which increases apply. You can also speak to your pension scheme provider for more details.
- Find out which staff to apply the increases to: As an employer it is your responsibility to make the minimum contribution for staff in pension schemes you pay into. The only exception is if staff are asked to be put into a different scheme that you are not obligated to pay into.
- Calculate and make contributions: Employers must include salary, wages, bonuses, and any other statutory pay when calculating minimum contributions. If you use a payroll provider or software, be sure that everything is in place before the rules are implemented.
Start this process as early as possible to avoid getting into any legal trouble. Not sure how much you need to contribute? The Pensions Regulator provides a free online contribution calculator that shows you the minimum contributions you must make for each staff member.
Employees who already contribute to their pension likely already know about the 2019 increases, but you should still inform your staff about the new changes. To save time, prepare a letter template that outlines the new pension rules and when it is set to start, what employees can expect in terms of contributions, and where they can find more information.
As an employer you have a legal obligation to follow the new pension rules. Failure to comply could result in severe fines, so make any necessary preparations before 6 April 2019.