This information summarises the new laws. It is based on draft guidance from OPRA (the Occupational Pensions Regulatory Authority). It sets out what employers must do to comply with the new laws.

You can get further details by contacting Pensions Focus.You may also like to refer to the DSS booklet Stakeholder pensions "a guide for employers" which the DSS has mailed to employers

Do these new laws apply to me?

1. Are you deducting contributions from your employees’ net pay and paying them to the provider of your employees’ personal pension or group personal pension?
2. Are you paying contributions yourself to your employees’ personal pension or group personal pension?

If your answer to either or both of these questions is yes then the new laws will apply to you. You will now have additional responsibilities.

If you answer no to both questions then you are not affected by these new laws, but you must ensure that you have adhered to all of the new Stakeholder pension scheme rules and regulations.

What are my new responsibilities?
These can be summarised as:

1. Preparing a record of payments due
2. Keeping the record up to date
3. Making payments by the legal due date shown on the record.

These are described in more detail below.

Preparing a record of payments due
You must prepare a statement showing the contributions that you have agreed to pay to the pension provider. This is known as the record. The provider will use the record to check that they receive the correct contributions and that they are received on time.

The record must show, for each employee separately:

• The amount of the employee’s contribution that you have deducted from their pay.
  This must be the net amount after the deduction of basic rate tax.
• The gross amount you are contributing for that employee.
• The legal due date for each contribution.
• The payday on which the contribution will be deducted or calculated.

The record should also show:

• The date that you expect to make payments to the pension provider.
• If payments are based on employees’ pay, the level of pay used and the rate of contribution as a percentage of pay.

Sending the record
As the record is a statement of the contributions you intend to make, it must reach the pension provider before the first legal due date shown on that record.

If you are sending the record by post or via a third party such as your financial adviser you must make sure that you send it in good time so that it reaches the pension provider before the legal due date.

Keeping the record up to date
It is the employer’s responsibility to prepare the record. It is also your responsibility to keep it up to date. You must keep the provider informed about any changes to contributions (either their amounts or their due dates) for example:

• Employees leaving or joining the scheme.
• Changes in the level of contributions at the annual renewal or at any other time.
• Where contributions are a percentage of earnings and earnings vary each month. (Note: it is your responsibility to ensure that the amounts of varying contributions are calculated correctly).
• When contributions are not to be paid because there are no deductions from earnings (eg employee off sick).

What is the legal due date?
The new law says that the pension provider must receive contributions from you by the following dates. These latest payment dates are known as the legal due dates and must be shown on the record.

• Contributions deducted from your employees’ pay must be with the provider by the 19th day of the month following the month that they were deducted from pay. (For example, all contributions deducted from your employees’ pay in August 2001 must be with the provider by 19 September 2001.)
• Your own contributions must be with the provider by the due date that you have agreed as shown on the record.

To make things easier we suggest that the legal due dates (latest payment dates) for both employee contributions and your own contributions are the same.

What happens if I do not comply?
The pension provider is required by law to report to OPRA if you do not make payments in accordance with the latest record that you have sent us.

OPRA may fine if you do not:

• Send a record of the payments that you are due to make before the legal due date of those payments.
• Keep the record up to date.
• Make payments by the legal due date.
• Make the full payments according to the record.