What is auto-enrolment?
Auto-enrolment is expected to be introduced in late 2024. Auto-enrolment is a pension savings plan rolled out by the government. It aims to improve Irish workers’ retirement outcomes. Currently, there are over 750,000 workers in Ireland without pension savings. This means they may only have the State Pension, (currently €277.30 per week effective Jan 2024), to retire on – meaning a huge drop in their living standards when they retire.
What does it mean for employers?
Most large employers in Ireland have existing pension plans in place so may feel they will not be impacted by these changes. But often membership of these plans is voluntary, meaning that not all employees have become members of the plan. Therefore, employers will need to decide whether to open their existing plans up to all employees to auto-enrol all non-members to their existing plan or to instead allow for the auto-enrolment of non-members to the new State auto-enrolment system.
Smaller employers will also need to decide if they should enter the State auto-enrolment system or obtain a flexible traditional occupational scheme which affords generous tax relief.
For more information on how this works, please access here
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