The Government has confirmed the automatic enrolment earnings trigger will increase to £10,000 from April next year, excluding 170,000 people from the reforms.
Auto-enrolment began for the UK’s largest employers in October last year and is being phased in until 2018.
Firms are only required to enrol employees earning above the auto-enrolment earnings trigger of £9,440 – the same level as the personal tax allowance – into a pension scheme.
The Department for Work and Pensions has today confirmed the earnings trigger will rise to £10,000 from April next year, meaning 170,000 less people will be automatically enrolled into a pension.
The lower and upper earnings limits upon which auto-enrolment contributions are based have been set at £5,772 and £41,865, respectively.
The DWP says: “With an earnings trigger of £9,440, around 10 million individuals are estimated to be in the eligible target population for automatic enrolment, of which around 37 per cent are women.
“Around 170,000 fewer individuals are eligible for automatic enrolment when the earnings trigger is set at £10,000, of which around 120,000 (69 per cent) are women.”