Auto-Enrolment Update – Case Law And Trigger Changes

Auto-enrolment update

Key points:

The Queen on the application of Fleet Maritime Services (Bermuda) Limited v. The Pensions Regulator [2015] EWHC 3744 confirms when peripatetic (basically "mobile") workers, who spend time outside the UK, are covered by an employer's auto-enrolment duties. The new qualifying earnings band for auto-enrolment minimum contributions will apply from April 2016 and remains based on the national insurance upper and lower earnings limits. The trigger for auto-enrolment remains at last year's level of the equivalent of £10,000 per annum in any pay period. Looking forward, the increased minimum contribution requirements are moving to April 2018 and April 2019 to match the tax year, and we may have big pensions tax relief upheavals to look forward to in the next Budget. Finally the DWP is introducing another set of limited changes to simplify auto-enrolment to take effect from April 2016. Auto-enrolment has been through a bit of a rollercoaster of media attention. Currently interest is at a bit of a low ebb despite the efforts of Workie the Workplace Pension, who we have to admit to having a soft spot for, and occasional discussions on micro-employers and Regulator updates on its enforcement efforts.

But, as with all things, auto-enrolment being out of sight does not mean that employers can put it out of their minds. This update sets out some standard statutory change information on triggers and qualifying bands and perhaps the first case on who is actually covered by the employer's auto-enrolment duties in a borderline case.

The Queen on the application of Fleet Maritime Services (Bermuda) Limited v. The Pensions Regulator [2015] EWHC 3744

This case considered how the auto-enrolment employer duties apply to staff on cruise ships. The basic point of law is that the duties only apply to staff who work in Great Britain, or who ordinarily work in Great Britain (amongst other requirements). The basis of cruise ship employment is a journey from a port (which may or may not be in Great Britain), an extended period of work on the high seas, and then returning to port (which may be the same as the departure port, or not).

The question raised was whether someone who spends most of their tour outside of Great Britain can be said to be ordinarily working there. The Regulator took the view that they can, the employer that they could cannot. The court got to decide.

The court's decision can be summed up in a quote:

"... a...