As the first staging dates for auto-enrolment loom closer, the Department for Work and Pensions has announced that how it defines the size of an employer for autoenrolment purposes will be redefined. This was announced as part of their response to the consultation, 'Revised implementation proposals for workplace pension reform'.

The adjustments will reduce the size of many employers for auto-enrolment purposes, with affected employers having the option to push back their staging dates, without the need to inform The Pensions Regulator of their intention to do so.

For auto-enrolment purposes, employers will now be able to determine their size by reference to the number of workers in their PAYE scheme, as opposed to by reference to the number of full-time equivalent workers: the resulting number may be smaller.

The change means employers with less than 50 workers in its PAYE scheme will not have an auto-enrolment staging date prior to May 2015. It will also allow:

  • employers with more than 50 people in their PAYE scheme, but not more than 50 workers; and
  • smaller employers who share a PAYE scheme with a larger employer, to postpone their staging dates.

The postponement of staging dates for smaller employers will also have an impact on the staging process more generally, with it being extended to February 2018.