Areyougettingthemostfromyourpension?

It’s time to talk pensions. No wait, come back! Your pension is important, and with some changes to auto-enrolment schemes on the horizon, we want to make sure our members are up to date. 

In previous years, Directors UK CEO Andrew Chowns has written about getting a fair pension at the BBC, and also making sure you’re covered when you work for an independent production company. Now, as of April 2019, some changes are coming into place that could affect members in either situation. So make sure you stay up to date by reading our guide to these changes below...

Background

Current legislation obliges employers to enrol all employees who ordinarily work in the UK and who satisfy age and earnings criteria into a qualifying workplace pension and pay at least a specified minimum level of contributions.

The framework has provided a very beneficial boost to the retirement savings landscape during the five years since its phased introduction. Over a million employers have now enrolled more than nine million workers into a workplace pension since 1st October 2012. 

Although it is administratively more difficult for freelancers to access the benefits of this framework, it is worth pursuing, particularly as the savings benefits for employees will soon be enhanced...

Higher minimum contributions

From April 2019 the minimum percentage of qualifying earnings that must be paid into auto-enrolment pensions will be increased to a total of 8%, of which the employer must contribute at least 3%. An additional key benefit arises from the government’s 20% tax credit paid on employee contributions — i.e. if the employee contribution is 5%, the actual deduction from pay will be 4%, with the government adding a further 1%.

Opting in

As Andrew set out in his earlier articles, employers are only required to auto enrol new employees three months after joining (referred to as a postponement period). However, freelancers on short term contracts have the right to opt in to a work place pension as soon as they start, if they give their employer required notice and meet the age and pay criteria to be either an eligible or non-eligible jobholder.

Following receipt of such notice, employers will be required to make the minimum employer contribution to the pension scheme as well as your own employee contribution (deducted from your pay), and they cannot avail themselves of any postponement option. Read on to find out more about opting in...

Opting in to the BBC’s auto enrolment pension scheme

An opt-in request needs to be sent to the BBC’s payroll department, based in India, to the email address below. The request must state your full name and address and should include “PAE Opt In Notice” in the subject bar of the email.

Email: [email protected]

The content of the email must also contain the following statement: “I confirm I personally submitted this notice to join NEST”. Upon receipt of the email the BBC will then send out the appropriate information and membership of NEST will be established.

Opting in to independent production companies’ pension schemes

Again, an opt-in request will need to be sent to your employer. Details of how to opt-in should be included in the letter you receive from your employer at the start of the engagement. If not, we recommend you address this to the senior person who arranged your engagement and ask for them to confirm in reply that they have actioned your request. The request must state your full name and address and should include ‘Pension Auto-Enrolment Opt-In Notice’ in the subject line of the email.

The content of the email must also contain the following statement: “I confirm I personally submitted this notice to opt-in to your auto-enrolment pension scheme”.

Upon receipt of the email they should then send out the appropriate information and membership of their scheme will be established.

Please note that not all production companies will use the same pension provider. Therefore, your contributions may not be applied to the same personal account when you commence a new engagement. However, if you are contracted to a new employer and are either automatically enrolled or you make a request to opt-in to a pension scheme with a provider who already holds a personal account for you, your contributions will be paid into that account. This is because the pension provider will verify the employee based on their National Insurance Number.

eligible

Are you eligible for auto-enrolment?

To be eligible for automatic enrolment, you must be:

• At least 22 years old;
• Not yet at State Pension age;
• Earning a salary of at least £10,000 p.a.;
• Normally working in the UK under a contract of employment

Outside of the above criteria, there are further age and earnings sub-categories which enable employees to opt in to an employer’s pension scheme, even though there is no auto enrolment requirement on the part of the employer. The full criteria are set out in the table below:

Make sure you’re up to date up with your pension — and if you have any questions, do get in touch on [email protected].