Help for employers on secondary pension rules

From July, new Secondary Pension regulations come into force, which means that all Guernsey employers have to provide a suitable pension and automatically enrol eligible employers for it.

Sovereign Group, a locally-based and leading independent provider of corporate, private client and retirement planning services, will be at the Vale Douzaine on Thursday 23rd May from 9.30am – 12.30pm to talk to employers and the self-employed – whether from the Vale or not – about the new requirements.

The Secondary Pensions Law was introduced by the States to enable islanders of working age to save more for their retirement so that they won't have to rely solely on the State Pension and tax-funded welfare benefits later in life.

According to the States (please see here), employers cannot choose whether they want to set up a pension or not. Under the legislation, they are required to provide a suitable pension scheme and automatically enrol any Designated Employees.

Penalties
If an employee isn't deemed a Designated Employee but meets eligibility criteria, then they can ask to be enrolled into the pension scheme ("a Voluntary Employee"). The employer must enrol Voluntary Employees, deduct employee contributions from their pay and pay this into the pension scheme.

An employer is not required under the Secondary Pension Law to make employer contributions in respect of Voluntary Employees but may choose to. If an employer fails in the requirements under the Law, they could be subject to penalties and this could include fines, imprisonment, or both.

Because this is a legal, technical and potentially complex issue, experts from Sovereign will be on hand during the morning to talk through the regulations, how to comply with them and generally answer questions employers may have on this new employment development.

• The session is free of charge and anyone who is an employer, is self-employed or has responsibility for employment issues locally is welcome to drop in and discuss secondary pensions. It is not open to the general public.