Should you consider casual workers for Auto Enrolment?

12th May 2017 | Posted in: Agricultural, Auto enrolment, Payroll casual worker

My employee is a casual worker – Do I need to consider Auto Enrolment for them?

The Auto Enrolment regime is now in full flow with approximately 102,000 small employers (5-49 staff) having staged in the first quarter of 2017/2018. The number of employers staging in quarters 2, 3 and 4 in 2017/2018 are reported to be 120,000, 106,000 and 67,000 respectively.

With this in mind it is never more important to be organised and have a scheme in place and ready to go on your staging date to allow scheme providers and payroll bureaus time to set these up.

As Summer approaches and temporary workers are being recruited in the hospitality and leisure and agricultural sectors, the question that keeps getting asked is:

‘Do I have to consider casual workers for Auto Enrolment?’

In short, the answer to this question is yes you have to consider them.

If the employee meets the criteria for age and meets the working requirements in the UK then the employer needs to consider the earnings of the temporary casual workers.

The starting points for temporary workers are:

  • Step A : Identify the relevant pay reference period
  • Step B : Identify what is payable in that period
  • Step C : Compare what is payable with the lower level of qualifying earnings and the earnings trigger for Auto Enrolment as appropriate

Trigger points are calculated by using a ‘Pay Reference Period’. This will depend on how often employees are paid. If they are paid monthly, the trigger point will be calculated on an annual pro-rata basis. Similarly, if they are paid weekly, the trigger point will be calculated using that as a reference period. If the worker reaches a pro-rated trigger point, they will need to be automatically enrolled regardless of the fact that they may only have qualifying earnings for a period of, for example 12 weeks.

For example, if an employee is earning £1,000 per month then they are above the pro rata trigger amount of £10,000 so they need to be Auto Enrolled into the scheme.

Employers might want to opt to use the 3 month postpone period rule for seasonal/sessional workers as this will allow them to assess this category of workers and the level of earnings if fluctuating throughout the short term contract before automatically enrolling them.

At Johnston Smillie we have already assisted many employers through the staging and compliance of Auto Enrolment so if you have any queries, please do not hesitate to contact Angie Harvey at our office who will put you in touch with the relevant person.

If you feel we could help you and would like to discuss any of the above, please contact Ross McKay CA on 0131 317 7377 or email to ross.mckay@jsca.co.uk.
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