Queen Elizabeth II 1926 - 2022

People who hold multiple jobs within different businesses may be at risk of receiving a smaller pension due to missing out on employer pension contributions.

The warning comes from pension provider Scottish Widows, which is calling on the Government to remove the auto-enrolment thresholds, which decide who does and does not qualify for a workplace pension.

Currently, employees need to earn at least £10,000 a year to qualify for a workplace pension under the rules of auto-enrolment.

Where a person meets this threshold, employers are required to open a pension on their employees’ behalf, and then contribute to that pension, although employees are entitled to opt-out at any time should they wish.

However, with the rise of multi-jobbers, i.e., those who work in multiple roles across different businesses and employers, there is a growing risk they may miss out entirely on contributions despite earning above the threshold, because they do not earn at least £10,000 from one single employer and are, therefore, not enrolled in a scheme.

The study from Scottish Widows revealed that almost half (49 per cent) of those who are employed in more than one job but are earning less than the threshold are not enrolled in their company pension.

In comparison, less than a quarter (23 per cent) of all employees are not enrolled, which highlights the plight of multi-jobbers.

Scottish Widows added that unbeknownst to many, while you need to earn £10,000 to qualify for automatic enrolment, so long as you earn above £6,240 you can opt into your company’s pension, with your employer legally required to contribute too at a rate of three per cent of your salary.

What’s more, even if you earn less than this amount you can still opt into the pension, though the employer isn’t compelled to contribute.

Link: Multi-jobbers missing out on millions in pension contributions