What is the Coronavirus Job Retention Scheme (CJRS) and how does this affect my pension contributions?

Last updated: 25 Nov 2020

According to the information published so far, the CJRS scheme will pay employers National Insurance contributions at the normal rate, but only pay employer pension contributions at the level of the minimum auto-enrolment rate (3% of earnings above £516 per month).

Any regular employer pension contributions above the minimum auto-enrolment rate will not be covered, and if your employer ‘tops up’ your salary to its normal amount, the scheme will not cover employer pension contributions on the extra top up amount.

The Pensions Regulator (TPR) have published guidance that employers will not be required to consult staff under the Occupational and Personal Pension Schemes Regulations 2006 to reduce their employer contributions for furloughed staff under the CRJS to the statutory auto-enrolment minimum rate.

Employee contributions are expected to still be deducted at the same percentage, albeit on the reduced amount of pay. TPR have recently published guidance for employers on the application of pension contributions paid under a salary sacrifice arrangement for furloughed staff under the CRJS.

It is not clear yet how the CRJS and being furloughed will impact on benefits being built up in a defined benefit scheme. Further guidance will be published shortly and these FAQs will be updated when more information is known.

Find out more about the Coronavirus Job Retention Scheme

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