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Join Which? MoneyPension auto-enrolment: how it works
Most workers are now automatically enrolled into a pension when they start a new job. Find out how auto-enrolment rules work, including how much you and your employer need to pay in.
In this article
- What is pension auto-enrolment and when did it start?
- Who is eligible for auto-enrolment?
- Auto-enrolment: what is the minimum you must contribute?
- What are auto-enrolment 'qualifying earnings'?
- Can you opt out of a workplace pension and are there any benefits?
- How do you opt out of pensions auto-enrolment?
- Auto-enrolment: what if you have more than one job?
- Can you transfer old pensions to your employer's pension scheme?
What is pension auto-enrolment and when did it start?
Auto-enrolment was introduced in October 2012 to boost the number of people saving for retirement.
It means that all employers must provide a workplace pension scheme and enrol eligible staff into it.
Both employees and employers must pay in a minimum amount under auto-enrolment rules. Here we explain how much this is and who qualifies for auto-enrolment.
Who is eligible for auto-enrolment?
You will be automatically enrolled into your work's pension scheme if you meet all of the following criteria:
- You aren't already in a qualifying workplace scheme
- You are aged at least 22
- You are below state pension age
- You earn more than £10,000 a year in 2025-26
- You work in the UK
Auto-enrolment: what is the minimum you must contribute?
The minimum total contribution for a workplace pension scheme is usually 8% of your earnings between £6,240 and £50,270.
This is made up of 5% from you (including tax relief) and 3% from your employer.
However, you can choose to pay in more than the minimum. Even small increases can make a big difference to the value of your pension over time.
In some schemes, your employer may contribute more than its required minimum amount. In this case you only need to make up the shortfall between the employer contribution and the total minimum contribution.
Here's how minimum contributions have changed since auto-enrolment was introduced:
| Until 5 April 2018 | 1% | 1% | 2% |
| 6 April 2018-5 April 2019 | 2% | 3% | 5% |
| 6 April 2019 onward | 3% | 5% | 8% |
- Find out more: you can use the Money Helper workplace contribution calculator to help you work out how much you'll pay into your pension and the tax relief you'll get on contributions.
What are auto-enrolment 'qualifying earnings'?
Your minimum contribution applies to anything you earn over £6,240 up to a limit of £50,270 (in the tax year 2025-26). This includes overtime and bonus payments.
Earnings between these amounts are known as 'qualifying earnings' and are used to calculate your pension contributions.
For example, if you earn £25,000 a year, the total minimum contribution would be 8% of £18,760 (the difference between £6,240 and £25,000).
- Find out more: how much will I need to retire?
Can you opt out of a workplace pension and are there any benefits?
You can opt out, but you should think carefully before you do this as it'll mean you'll also lose out on contributions from your employer.
You can opt out at any time. If you opt out within the first month, your payments will be refunded in full.
If you opt out after the first month, any payments you've made will stay in your pension.
Opting out isn't final - you can re-join at a later date. Also, employers will be required to re-enrol you every three years, so you can reconsider your decision.
How do you opt out of pensions auto-enrolment?
Contact your pension provider if you want to request to leave the scheme.
You can get contact details of the pension company from your employer.
If you opt out within one month of being automatically enrolled, any money you have paid into the pension will be refunded, otherwise the money will remain in the scheme until you retire.
Auto-enrolment: what if you have more than one job?
If you have more than one job, each job is treated separately for automatic enrolment purposes. You can still opt out of individual schemes if you want.
Each of your employers will check whether you're eligible to join their pension scheme.
Can you transfer old pensions to your employer's pension scheme?
If you've regularly changed jobs throughout your career, auto-enrolment means that you may have built up a number of different pensions with different employers.
Combining your pensions can make it easier to keep track of your retirement savings.
It's usually possible to move existing pensions into your current workplace scheme, but you should contact the scheme administrator to find out more.
Many workplace pensions are 'master trust' schemes, which are defined contribution schemes that are used by multiple employers. Here are some of the big master trusts in the UK:
Does auto-enrolment apply to you if you're self-employed?
No, self-employed workers aren't automatically enrolled into a pension scheme.
This means if you're self-employed and want to save into a pension you'll have to open one yourself.
You won't benefit from employer contributions as you would in a workplace scheme, but you will still benefit from tax relief on your contributions.
- Find out more: pensions vs lifetime Isas