The minimum contributions for both employee and employer are set to increase from 6 April 2019.

DateEmployer minimum contributionStaff minimum contributionTotal minimum contribution
New rate: 6 April 2019 onwards3%5%8%
Current rate: 6 April 2018 – 5 April 2019 onwards2%3%5%

The minimum amount the employer must contribute will be 3%, and the total contribution, including the employee’s contribution, is 8%. If your contributions are currently above these rates then it is likely that no change is necessary.

Employers that are currently paying the minimum contributions of 2% should inform employees that their contribution will increase to 5% from 6 April 2019 and the employer’s contribution will increase to 3%.

The Pensions Regulator has produced guidance for employers dealing with the increase including a letter template to advise staff of the change.

As an employer, it is your responsibility, under the Pensions Act 2008, to make sure the right minimum contributions are being paid for your staff and it would be advisable to inform your employees of the increase in advance.

If you outsource your payroll, your provider should have already been in touch with you to let you know about the changes.

If you have any queries with the above, please contact Andrew Senior either by emailing a.senior@sagars.co.uk or calling 0113 297 6742