My (previous) employer refused to let me ‘opt in’ to the workplace pension scheme early and said I had to wait three months. I believe this is wrong, you should be able to opt in as soon as you wish. Am I correct?

On leaving the employer, my final pay was made up of holiday back pay and a bonus. However, on my final pay slip, the former employer did not pay pension contributions and they appear to have “opted me out” against my wishes. Are they wrong to do that? Should my final pay have included pension contributions from both parties?

What can I do about this? Who should I speak to in the first instance and where do I progress a complaint?

Matt

Tom Selby, AJ Bell Head of Retirement Policy, says:

On your first question, you could potentially have grounds for a complaint if you were eligible to be enrolled in your employer’s workplace pension and they did not take the correct action.

Under automatic enrolment rules, all UK employers are required to offer qualifying staff a pension. To qualify for auto-enrolment you need to be between 22 years old and state pension age (currently 66) and earning at least £10,000 per year.

Those who meet these criteria will be auto-enrolled into a pension scheme, with minimum total contributions set at 8% of qualifying earnings (4% from the employee, 3% from the employer and 1% from tax relief). For 2022/23 qualifying earnings are those between £6,240 and £50,270.

Those who don’t qualify for auto-enrolment are entitled to ‘opt-in’ or join a scheme, although you may not receive an employer contribution.

The rules allow firms to postpone auto-enrolling employees up to three months after your first day of employment or from the point when you meet a certain trigger.

However, if you tell your employer you want to join the pension scheme during this postponement period, they are legally bound to enrol you. If you qualify for auto-enrolment, you will also be entitled to matched employer contributions during this period.

Similarly, if you tell your employer you are leaving but do not opt-out of the pension scheme, they are still required to enrol you based on the minimum criteria set out above.

Before making a formal complaint, you should speak to your former employer in the first instance as they may be willing to resolve the issue.

If they aren’t, as this relates to a possible administration failure in a workplace pension scheme, the most likely avenue is the Pensions Ombudsman.

You can complete the complaints process online. You’ll need details of your complaint, including when it happened and when you became aware of the issue, your supporting documentation, including your initial complaint and any responses you have received, the name, address and contact number of the parties you believe are at fault.

DO YOU HAVE A QUESTION ON RETIREMENT ISSUES?

Send an email to asktom@sharesmagazine.co.uk with the words ‘Retirement question’ in the subject line. We’ll do our best to respond in a future edition of Shares.

Please note, we only provide information and we do not provide financial advice. If you’re unsure please consult a suitably qualified financial adviser. We cannot comment on individual investment portfolios.

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