Employers: 2026 is the Year of Pensions Auto-Enrolment in Ireland. Don’t wait. Now is the time to get prepared.
What is Auto-Enrolment?
Auto-enrolment is a new system that makes saving for retirement mandatory for most workers.
Starting on January 1st 2026, this plan aims to increase the number of people saving for retirement. The government expects it will help about 800,000 new savers.
For employers, this will mean new rules to follow and higher costs. It’s important to understand how Auto-Enrolment will affect your business and your employees, both now and in the future.
How will Auto-Enrolment work? Who is included?
– Employees aged 23–60 who earn more than €20,000 per year will be automatically enrolled in the new State run retirement savings system.
– Workers won’t be enrolled if they are already saving through a qualifying pension plan (such as PRSAs or occupational pension plans).
– Auto-enrolment doesn’t apply to self-employed individuals.
Contribution rates:
– Both employers and employees will start by contributing 1.5% of gross earnings for the first three years (up to €80,000).
– Contributions will rise every three years, reaching a maximum of 6% by year 10.
– The government will also top up employee contributions.
Existing pension plans:
Employers can keep their current pension plans. These plans will need to meet minimum standards by year seven of the auto-enrolment system.
Employees must consent to join the employer’s pension plan or PRSA scheme. If they don’t, they will be enrolled in MFF unless the employer pays a contribution to the plan on their behalf.
As a result, if an employer wishes to use their own pension plan in lieu of the State run scheme, employee engagement is vital.
What should employers do now?
To prepare, employers should:
– Understand who will be affected. This includes all employees earning over €20,000 per year, including part-time and temporary workers.
– Decide how to meet the requirements. You can either use MFF, adapt your existing pension plan or do a combination of both.
– Engage with employees. Explain their options and get their agreement if you want to use your own pension plan.
How much will it cost?
Auto-enrolment will add new costs for businesses. Employers need to budget for:
Contributions: Starting at 1.5% of earnings per employee and rising over time.
Setup expenses: Adjusting payroll systems or introducing new pension plans.
You need to start planning now:
The legislation will affect 100,000’s of companies.
With so many employers needing advice and assistance, it is very likely that advisory firms will reach full capacity long before the deadline approaches.
Our pension team are already assisting companies identify and access the implications of the introduction of the new State run scheme, put plans in place and take the actions required prior to the implementation of the scheme.
We’d be happy to discuss Auto-Enrolment in more detail with you.