Are you prepared for auto enrolment?

Discussion in 'Articles & Tutorials' started by Fergal, Apr 12, 2013.

  1. Fergal

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    Nov 18, 2007
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    Are you prepared for auto enrolment?

    Auto enrolment was thrust upon both business and employees at the end of last year, and will stand as one of the most important pieces of workplace legislation ever to have been introduced.
    Auto enrolment will remove pension apathy by automatically enrolling all eligible UK workers – over 22 years old; earning more than £155 a week; ordinarily working in UK - into a scheme provided by the employer. This naturally gives rise to concerns both on the part of employer and employee.

    The employee retains the right to opt out of the scheme, and can reclaim any contributions within a given time limit – although they will be re-enrolled every three years. Minimum contributions from both sides are marginal and will place emphasis on the employee for their own provision:

    From 2012 to 2016, the total contribution required is 2%, consisting of 1% from the employer and 1% from the employee; by 2016 total contributions will hit 5%, 2% from the employer and 3% from the employee; by 2017 minimum contribution is 8%, 3% from employer and 5% from employee.

    The fears for business – particularly small business and sole employers – will be the burdensome demands on time, red tape and additional bureaucracy, but finding a good scheme can be easier than you may think. Organisations like can provide a diversity of competitive pension services to an array of clients.

    Rollout is staggered with big companies engaging first as they naturally have the HR departments to deal with such change. Businesses with between 50 and 249 staff will need to be in line between April 2014 and April 2015, and eventually, businesses with fewer than 30 eligible members which won’t be included until around 2017.

    A good pension scheme can be a great investment for both sides of the business coin. A good scheme will attract the best staff, whilst incentivising and encouraging loyalty. The employee can benefit from employer contributions and a tax free investment; pensions are widely acknowledged to be the best old age savings plan.

    Enlist a plan that lends bends to the modern climate of economic uncertainty like those available with Now Pensions, which don’t rely merely on bonds and equities.

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