A significant shift in the UK's pension landscape means hundreds of thousands more part-time and low-income workers will now qualify for a workplace pension. New analysis from Standard Life has revealed that, from April 2026, working just 15 hours per week on the National Living Wage will be enough to trigger automatic enrolment into a pension scheme.
From 25 Hours to 15: The Changing Threshold
When the government's flagship auto-enrolment policy launched in 2012, the rules were far stricter. Back then, the National Minimum Wage for those aged 21 and over was £6.19 per hour, and the annual earnings trigger for auto-enrolment was set at £8,105. This meant an employee needed to work approximately 25 hours every week throughout the year to qualify for their employer's pension scheme.
The landscape has transformed dramatically since. While the annual earnings trigger has remained frozen at £10,000 since 2014, the minimum wage has risen steadily. The government has confirmed the National Living Wage for those aged 21 and over will increase to £12.71 from April 2026. This combination of factors means the weekly hours needed to hit the £10,000 threshold have plummeted by 10 hours, making pension saving accessible to a much broader workforce.
A Lifeline for Low-Income Retirement Savers
For many in part-time or low-paid roles, saving for retirement has traditionally taken a back seat to immediate financial pressures. Standard Life's research underscores this, finding that only 9% of low-income households see pension saving as a priority for the next year, compared to 28% of high-income households.
However, the new calculations show that even minimal hours can build a meaningful retirement fund. An employee on the minimum wage working 15 hours a week could see £818 added to their pension pot in a year through auto-enrolment, boosted further by tax relief and crucial employer contributions. For someone in full-time employment (37.5 hours), the annual contribution could be around £2,030.
The long-term impact is substantial. A 22-year-old working full-time on the minimum wage could accumulate a pension pot worth up to £208,000 in today's money by state pension age.
The Future of Pension Policy and Vulnerable Groups
The push for greater pension inclusion comes as the recently re-established Pension Commission focuses on the adequacy of savings among vulnerable groups. Currently, just one in four low-income private sector workers is saving for retirement.
The Commission is expected to consider further reforms to auto-enrolment, such as lowering the age threshold and abolishing the minimum earnings limit entirely. Catherine Foot, Director of the Standard Life Centre for the Future of Retirement, welcomed the impact of the rising wage. "A rising minimum wage not only boosts pension savings through higher contributions on increased salaries, but it also makes auto-enrolment more accessible," she said.
Foot added, "Although cost of living pressures remain a priority, even a small amount saved to a workplace pension, which is boosted by valuable employer contributions, can make a meaningful difference to future retirement incomes." She noted that the Commission's challenge will be balancing the need to help vulnerable groups save more with the rising cost of employment for businesses.
