Auto-Enrolment Pension Ireland 2025 — What Every Employer Needs to Know

Ireland’s Automatic Enrolment Retirement Savings System (AERSS) — known as auto-enrolment — is one of the most significant changes to employment obligations for Irish businesses in a generation. After years of delays, the scheme launched in 2025, and Irish employers now have legal obligations around pension enrolment, contributions, and payroll processing that didn’t exist before.

This guide explains what auto-enrolment means for Irish employers, what the contribution rates are, how the opt-out process works, and which payroll software supports it.

What Is Auto-Enrolment?

Auto-enrolment is a mandatory workplace pension scheme that automatically enrolls eligible employees into a pension plan. Unlike the old voluntary approach — where employers had no obligation to offer a pension — auto-enrolment makes pension provision the default for most Irish workers.

The scheme is operated by the National Treasury Management Agency (NTMA) through a new central auto-enrolment system. Contributions from employees, employers, and the State flow into the central system and are invested on the employee’s behalf.

Auto-enrolment doesn’t replace existing occupational pension schemes. Employers that already offer a qualifying pension scheme meeting the minimum contribution requirements are exempt from the AERSS system.

Who Must Be Auto-Enrolled?

An employee must be automatically enrolled if they meet all three of the following criteria:

Age: Between 23 and 60 years old
Earnings: Earning €20,000 or more per year (across all employment, not just with your company)
No existing pension: Not already a member of a qualifying occupational pension scheme

Employees outside these criteria — under 23, over 60, or earning less than €20,000 — are not automatically enrolled but can choose to opt in voluntarily.

Employer obligation: You must enrol all eligible employees. You cannot exclude or discourage an employee from participating.

Auto-Enrolment Contribution Rates

Contributions are phased in over 10 years to ease the transition for employers and employees. The contribution rates are expressed as a percentage of the employee’s gross earnings:

Phase	Years	Employee	Employer	State top-up
Phase 1	Years 1–3	1.5%	1.5%	0.5%
Phase 2	Years 4–6	3%	3%	1%
Phase 3	Years 7–9	4.5%	4.5%	1.5%
Phase 4	Year 10+	6%	6%	2%

Total contribution in Phase 1: 3.5% of gross earnings (1.5% employee + 1.5% employer + 0.5% State)
Total contribution at full rate: 14% of gross earnings

Employer contributions are a payroll cost on top of wages — this is new money that employers must budget for, not a deduction from the employee’s salary.

Contributions are capped at earnings up to €80,000 per year. Earnings above €80,000 are excluded from the contribution calculation.

How Contributions Are Collected

The employer deducts the employee contribution from the employee’s net pay each payroll period and adds the employer contribution. Both are remitted to the NTMA’s central system alongside the payroll run — similar to how PAYE and PRSI are remitted to Revenue via ROS.

Your payroll software handles the calculation and the payroll file generation. The NTMA system receives the contributions and invests them on the employee’s behalf.

Opt-Out Rights

Auto-enrolment is mandatory for employers — but employees have the right to opt out. The opt-out process works as follows:

Employees can only opt out during a specific opt-out window — from the start of month 7 to the end of month 8 after their enrolment date
If an employee opts out, their contributions (employee and employer) are refunded
Employees who opt out are automatically re-enrolled after 2 years
There is no mechanism for employers to opt employees out on their behalf

Important: You cannot offer incentives to employees to opt out, and you cannot use opt-out status as a factor in any employment decision.

Employer Checklist

Here’s what Irish employers need to action:

Identify eligible employees — check age (23–60) and earnings (€20,000+) criteria
Check existing pension scheme — if you have a qualifying occupational scheme, confirm whether it meets the exemption criteria with your pension advisor
Update payroll software — ensure your payroll software is certified for auto-enrolment (see below)
Register with the NTMA system — employer registration is required before contributions can be processed
Notify employees — provide written notification of enrolment before deductions begin
Update employment contracts — auto-enrolment is a material change to terms; document it
Budget for employer contributions — Phase 1 employer rate is 1.5% of eligible payroll

Payroll Software and Auto-Enrolment

Irish payroll software has been updated to handle auto-enrolment calculations and NTMA file generation. The main Irish payroll platforms supporting auto-enrolment in 2025:

BrightPay — auto-enrolment is supported in BrightPay 2025. Includes employee eligibility checking, contribution calculation, and NTMA submission file generation.
Thesaurus Payroll — updated for auto-enrolment with similar functionality to BrightPay.
Collsoft — supports auto-enrolment processing including eligibility tracking and NTMA file export.

If you’re using older payroll software that hasn’t been updated, now is the time to review your options. Running auto-enrolment on unsupported software is a compliance risk.

For businesses using a payroll bureau, confirm with your bureau that they are handling auto-enrolment compliance on your behalf and check what additional charges apply.

What If You Already Have a Pension Scheme?

If your business already operates an occupational pension scheme, you may be exempt from the AERSS if:

The scheme is Revenue-approved
Employer contributions meet or exceed the AERSS minimum employer contribution rates at each phase

You’ll need to confirm exemption status with your pension trustee or broker. Don’t assume exemption without checking — if your scheme doesn’t meet the minimum contribution rates, you may need to top up or register employees with the AERSS for the shortfall.

Penalties for Non-Compliance

The Pensions Authority enforces auto-enrolment obligations. Penalties for employers who fail to enrol eligible employees or fail to remit contributions include:

Fixed penalty notices
Civil proceedings for unpaid contributions (with interest)
Prohibition notices restricting business operations in serious cases

The focus in the initial rollout period is on employers who are making genuine efforts to comply — but wilful non-compliance carries significant financial risk.

Auto-Enrolment and HR Software

HR platforms like HRLocker and Bizimply track employee records including pension enrolment status. They don’t process the contributions themselves (that happens through payroll software and the NTMA system), but they can track:

Which employees are enrolled
Opt-out records and re-enrolment dates
Employment dates and earnings for eligibility checks

Keeping this data current in your HR system makes the payroll software’s job simpler and creates an audit trail if the Pensions Authority ever queries your compliance.

Key Dates

2025: Auto-enrolment scheme launched. Phased employer onboarding begins.
Phase 1 contribution rates (1.5% employee / 1.5% employer / 0.5% State) apply for the first three years.
Re-enrolment: Employees who opt out are automatically re-enrolled every 2 years.

Frequently Asked Questions

When does auto-enrolment start in Ireland? The Irish auto-enrolment scheme launched in 2025. Employer onboarding is being phased in — check with the NTMA or your payroll provider for your specific enrolment date.

Do I have to pay auto-enrolment contributions for all my employees? Only for eligible employees: aged 23–60, earning €20,000+ per year, and not already in a qualifying pension scheme. Employees outside these criteria are not automatically enrolled (though they can opt in).

How much will auto-enrolment cost my business? In Phase 1, the employer contribution is 1.5% of each eligible employee’s gross earnings (up to €80,000). For an employee on €40,000, that’s €600/year in additional employer cost.

Can employees opt out of auto-enrolment? Yes. Employees can opt out during months 7–8 after their enrolment date. If they opt out, they receive their contributions back. They are automatically re-enrolled after 2 years.

Does auto-enrolment replace existing pension schemes? No. Employers with qualifying occupational schemes meeting the minimum contribution requirements are exempt from AERSS. Check with your pension provider to confirm whether your existing scheme qualifies.

Which payroll software supports Irish auto-enrolment? BrightPay, Thesaurus Payroll, and Collsoft all support auto-enrolment. Check that your payroll software is on a current version that includes auto-enrolment functionality.

What happens if I don’t enrol eligible employees? Non-compliance is enforced by the Pensions Authority. Penalties include fixed notices, civil proceedings for unpaid contributions, and in serious cases, prohibition notices.

Is auto-enrolment the same as a PRSA? No. A PRSA (Personal Retirement Savings Account) is a voluntary individual pension product. Auto-enrolment is a mandatory employer-administered workplace pension scheme. They are separate products under separate legislation.