The transitional period for pension schemes with defined benefits ends on 30 September 2017. This means that if you have applied the transitional period, you will need to take action to comply with the law.
The transitional period was available for you to apply to your staff who could have joined your pension scheme with defined benefits, but either chose not to, or left the scheme before your staging date. Using the transitional period meant that you were able to delay putting these staff into a pension scheme for automatic enrolment.
You may also have chosen to apply it to staff who were already in your pension scheme with defined benefits on your staging date.
By law, the transitional period is ending on 30 September 2017.
The transitional period can only be used with specific types of pension scheme called defined benefits (DB) pension schemes, so if you don't have this type of scheme you don't have to take any action. Defined benefit schemes are mainly used by large employers and employers in the public sector, and are sometimes known as 'final salary schemes' or 'career average schemes'.
If you used NEST, or one of the schemes open to small employers that are listed on our choose a pension scheme page and you have no other scheme available to your staff, you won’t have used the transitional period.
Also, if you assessed all of your staff for automatic enrolment on your staging date, you probably didn’t use the transitional period.
If you’re unsure whether you used the transitional period, you will need to check your records on what you have done. To help you do this you could check:
To help make sure you are ready to comply with your automatic enrolment duties you should:
You will need to take the following steps to ensure that you comply with the law:
You can delay assessing your staff on a one-off basis for up to three months from 1 October 2017. This is known as postponement.
You do not need to change your declaration of compliance or re-declaration to tell us that you have completed your duties at the end of the transitional period.
If any of your staff who you applied the transitional period to didn’t meet the age and earnings criteria for automatic enrolment, you need to assess them each time you pay them to see if they need to be put in your scheme with defined benefits for automatic enrolment.
If they do meet the age and earnings criteria in the future, you must put them into your scheme with defined benefits and backdate contributions to the 1 October 2017. You won’t be able to use postponement for these staff.
For other staff you’ll need to continue with your automatic enrolment duties each time you pay them.
Remember, failure to complete your ongoing duties, including taking action when the defined benefits transitional period ends, means that you will not have complied with all of your employer duties. Failure to comply with these duties could result in fines and/or prosecution.
We have detailed guidance available if you are a large employer, an employer whose circumstances haven’t been covered here, or you require more detailed information in order to advise your clients. This guidance is written for pensions professionals.