· compliance · 6 min read
Auto-Enrolment Ireland — The Complete Employer Guide for 2025
Ireland's auto-enrolment pension scheme changed the rules for every Irish employer. Here's a plain-English guide to what you must do, when, and how.
Ireland’s auto-enrolment pension scheme is now live. After nearly two decades of policy development and repeated delays, the Automatic Enrolment Retirement Savings System (AERSS) rolled out in 2025 — and it creates new legal obligations for almost every Irish employer.
This is the plain-English guide to what auto-enrolment means for your business, what you must do, and what happens if you don’t.
What Is Auto-Enrolment?
Auto-enrolment is a mandatory workplace pension system. Instead of employees having to actively decide to join a pension scheme, they are automatically enrolled and must actively choose to opt out.
The scheme is operated by the National Treasury Management Agency (NTMA). Contributions from the employee, the employer, and the State are pooled and invested through the NTMA’s central system, building a pension pot for each enrolled worker.
For Irish employers, this is a significant change. Prior to AERSS, there was no general legal obligation to offer a pension or make employer contributions. That is no longer the case.
Which Employees Must Be Enrolled?
An employee must be automatically enrolled if they meet all three of the following:
- Age: 23 to 60 years old
- Earnings: €20,000 or more per year (across all employment)
- No pension: Not already a member of a qualifying occupational pension scheme
Employees who don’t meet these criteria — those under 23, over 60, or earning less than €20,000 — are not automatically enrolled but can request to join voluntarily.
Part-time and seasonal workers: Their earnings are assessed across all employment, not just hours worked for you. A part-time worker earning under €20,000 across all jobs is not eligible. You are not expected to verify total earnings from other employers — you assess on the basis of known earnings from your employment.
Contribution Rates
Auto-enrolment contributions are phased in over 10 years:
| Phase | Years | Employee | Employer | State |
|---|---|---|---|---|
| Phase 1 | 1–3 | 1.5% | 1.5% | 0.5% |
| Phase 2 | 4–6 | 3% | 3% | 1% |
| Phase 3 | 7–9 | 4.5% | 4.5% | 1.5% |
| Phase 4 | 10+ | 6% | 6% | 2% |
Contributions are calculated on gross earnings up to a cap of €80,000 per year. Earnings above €80,000 are excluded.
The employer contribution is an additional cost. In Phase 1, the employer contributes 1.5% of eligible earnings on top of the employee’s wages. For an employee on €35,000, this is €525 per year in additional employer cost. Budget for this before your enrolment date.
How It Works in Practice
- You identify eligible employees (age 23–60, earning €20,000+, no existing qualifying pension)
- You notify them in writing before deductions begin
- Your payroll software calculates contributions each pay period
- Employer and employee contributions are deducted and remitted to the NTMA alongside your regular payroll run — similar to remitting PAYE to Revenue
- The NTMA invests the contributions in a default investment fund on the employee’s behalf
- Employees can view their pot and manage their preferences through the NTMA’s online portal
Opt-Out Rules
Employees have the right to opt out, but there are strict rules around how and when:
- Opt-out window: An employee can only opt out from the start of month 7 to the end of month 8 after their enrolment date. They cannot opt out on day one.
- Contributions during the waiting period (months 1–6) are held and refunded if they opt out.
- Re-enrolment: Employees who opt out are automatically re-enrolled every 2 years. They can opt out again during the new opt-out window.
What employers cannot do:
- You cannot offer an employee incentives to opt out
- You cannot use opt-out status as a factor in any employment decision
- You cannot process an opt-out request before the opt-out window opens
Businesses Already Operating a Pension Scheme
If you already run an occupational pension scheme, you may be exempt from AERSS — but only if:
- The scheme is Revenue-approved
- Employer contributions meet or exceed the AERSS minimum rates at each phase (1.5% in Phase 1, rising to 6% at full rate)
If your current scheme doesn’t meet these minimums, you have options: top up contributions to meet the threshold, or enrol employees in AERSS for the gap. Get advice from your pension broker or trustee before your enrolment date.
Payroll Software
Your payroll software must be updated to handle auto-enrolment. The calculation and remittance workflow is built into payroll, not handled separately. The main Irish payroll platforms have all been updated:
- BrightPay — fully supports auto-enrolment in the 2025 version, including eligibility checks, contribution calculations, and NTMA file generation
- Thesaurus Payroll — updated for auto-enrolment, same core functionality as BrightPay
- Collsoft — supports auto-enrolment from 2025
If you use a payroll bureau, confirm with them that auto-enrolment is included in your service and ask whether there is an additional charge.
If you’re on an outdated or unsupported payroll product, you need to upgrade before your enrolment date. Running auto-enrolment contributions on unsupported software is a compliance risk.
HR Software and Record Keeping
Auto-enrolment creates record-keeping obligations. You need to document:
- Which employees are enrolled
- Enrolment dates
- Opt-out elections and dates
- Re-enrolment dates for employees who previously opted out
HR platforms like HRLocker and Bizimply can track these records within the employee profile. Whether you use dedicated HR software or a well-maintained spreadsheet, keep the records — the Pensions Authority can request them.
Penalties
The Pensions Authority enforces auto-enrolment compliance. Failures include:
- Not enrolling eligible employees
- Failing to remit contributions on time
- Offering inducements to opt out
- Interfering with an employee’s decision to opt in
Penalties range from fixed-penalty notices to civil proceedings for unpaid contributions (with interest). Serious or repeated non-compliance can result in prohibition notices.
Common Questions from Irish Employers
Does auto-enrolment apply to directors? It depends. A director who is also an employee drawing a salary and meets the eligibility criteria (age 23–60, earnings €20,000+) must be enrolled. A director drawing dividends only (no PAYE salary) is generally not eligible. Check with your accountant if you’re unsure.
What about employees who are already past retirement age? Employees aged 61 or over are excluded from mandatory enrolment but can opt in voluntarily.
What if an employee works for multiple employers? Each employer assesses eligibility independently based on their own employment relationship. You are not responsible for coordinating with other employers.
Does auto-enrolment affect the employer PRSI rate? No. Auto-enrolment contributions are separate from PRSI and do not affect the PRSI class or rate.
Summary for Employers
| Action | Deadline |
|---|---|
| Identify eligible employees | Before your enrolment date |
| Update payroll software | Before your enrolment date |
| Register with NTMA system | Before contributions begin |
| Notify employees in writing | Before first deduction |
| Budget for employer contributions | Immediately |
Auto-enrolment is live. If you haven’t started preparing, the time is now.
For the detailed breakdown of contribution rates, investment fund options, and the State top-up mechanics, see our auto-enrolment pension Ireland guide.
Frequently Asked Questions
Is auto-enrolment mandatory in Ireland? Yes. Eligible employees (age 23–60, earning €20,000+, with no qualifying pension) must be automatically enrolled. Employers have no discretion to exclude eligible employees.
When did auto-enrolment start in Ireland? The scheme launched in 2025. The phased employer onboarding process means different employers have different enrolment dates.
Can an employee opt out of auto-enrolment immediately? No. Employees can only opt out during a specific window: from the start of month 7 to the end of month 8 after their enrolment date.
How do I remit auto-enrolment contributions? Through your payroll software, which generates a contribution file submitted to the NTMA alongside your regular payroll run. The process is similar to submitting PAYE to Revenue.
What payroll software supports Irish auto-enrolment? BrightPay, Thesaurus Payroll, and Collsoft all support auto-enrolment from 2025. Check that your software is on a current version.
Do I need to offer a choice of pension fund? The NTMA’s central system provides default investment funds. You don’t need to source or manage a pension fund yourself — that’s handled centrally.