Setting up a Pension Scheme
Go to the Pension module and select Administration > Pension Scheme
Select New Pension Scheme from the top-right corner
A new page - "Pension Scheme Details" - will open. It is divided into several different sections.
Section 1: New Pension Scheme
The first section should be completed using information about the Pension Scheme. The relevant Pension Provider should be able to provide all of the information required in this section.
The following are mandatory fields:
· Pension Name
· Pension Provider
· Reference Number
Important Information - see Fig.2:
· All Qualifying Pension Schemes must be set up as so, by ticking the box.
· Select what calculation (Stakeholder, Net % Deduction, etc) applies to the scheme. This will set the calculation for all employees enrolled on this scheme in the future
· For Pensionable Pay Type, the options to choose are either Pensionable or Qualifying earnings. Once selected, the scheme will know which type of earnings to use in the pension calculation. Payment types can be set to be Pensionable or Qualifying (or both) in the Payroll Module
The question mark help icons - provide more information about each field.
Section 2: Automatic Enrolment Scheme
This second section must be completed if the pension is an Automatic Enrolment Scheme.
· Ticking Automatic Enrolment Scheme will reveal further boxes and fields that apply to postponement - see Fig.3
· Ticking Postponement Period and EJ Postponement Period boxes will reveal yet further boxes and fields - also see Fig.3
Fig.3 - Automatic Enrolment Scheme settings
· Make sure that For the assigned pay basis below is ticked, and complete the postponement sections on the right, as per the Pension Scheme rules
Section 3: Payment Methods
This section is used to configure, for reporting purposes only, how payments are made to the Pension Provider.
· By ticking the External Payment box, a new field - Payment Method - will appear
· Select either Cheque, BACS, or Direct Debit from the Payment Method drop-down
Section 4: Contributions
This section should reflect the default contributions that will be applied to all employees enrolled on the scheme. Qualifying bands can also be input for each contribution type. The qualifying bands are set by the Department for Work and Pensions (DWP) each year.
For any Contributions (Employer or Employee):
· Select a Contribution Type
· Enter a Contribution Amount
· If wished, populate the Use Band For Contributions fields, as per the DWP's current figures. Enter the minimum and maximum bands that apply to the payroll frequency of the pay basis that will be linked to this Pension Scheme
Section 5: Assign Pay Basis to Pension Scheme
· Select the Primary Pay Basis that will be linked to this Pension Scheme and then Save
· Additional Pay Basis can be added by selecting any available ones and using the arrow buttons to set as 'Assigned' - again, Save once complete
All employees attached to this Primary Pay Basis during creation will automatically be assigned to this Pension Scheme and will default to all of the rules configured on this page.
The Pension Scheme will now be set up.
· All Pension Schemes can be viewed by going to Payroll Module > Administration> Pension Scheme
Important Information
If there are some employees that have different rules to the default ones set up within the Pension Scheme, a ‘Worker Group’ can be set up. Worker Groups can be only be defined to groups of people categorised by either Job Tile, Location, Contract or New Starter Status.
See also - WFM - Creating a Worker Group