Workplace Pension and Auto Enrolment
Our in-house Auto Enrolment and Employee Benefits team have a wealth of experience in advising companies and professional services firms. A great endorsement that we have the ability to combine both leading edge benefits consultancy with an individually focussed employee advisory service.
More Choice… Your Choice…
If the words ’employee benefit’ are taken literally, you’d be forgiven for thinking that all the benefit sits with the employee. But with 66% of staff saying they would be more likely to stay with an employer that offered good benefits, it’s clear that employers also stand to gain. It seems that fewer people are inclined to do any more than the bare minimum needed to do their day-to-day duties.
But is this something companies really need to worry about?
After all, aren’t there plenty of people out there desperate for a job if you lose a disgruntled employee?
Well, putting aside the fact (and it’s a very big fact) that it can cost £30,614 to replace an employee earning £25,000, unhappy and disengaged employees are less effective at their job, less motivated and more likely to go off sick from work.
For employees, a benefit package can help plan for old age and unexpected events (like becoming ill or injured), and can save them a bit of money on day-to-day expenses too.
For employers, a strong, relevant and well-communicated benefits package not only helps employers make sure they get the pick of employees at recruitment, but can also help them retain happy, committed workers.
We can assist you in how you can best put together an appropriate, flexible employee benefits solution that will help to improve your business, and create an employee engagement strategy to help communicate your benefits solution.
You can find out how Chiltern Select Essentials can work for you in Our Services section, at www.chilternselect.com or simply contact us on 01494 451441 or email email@example.com
Automatic Enrolment for Employers
Please note that most advice on auto-enrolment, occupational pensions and workplace pensions is not regulated by the Financial Conduct Authority but by The Pensions Regulator.
What is Automatic Enrolment?
The government introduced new legislation in 2012 designed to help people save more for their retirement. It requires all employers to enrol eligible workers into a workplace pension scheme if they are not already in one. Automatic enrolment started being phased in from October 2012 and has now been full rolled out. Most employers will have to set up and contribute to a pension scheme suitable for automatic enrolment.
Understand Your Workforce
You will need to understand the different types of workers and what defines them, as well as the corresponding employer duties for each type of worker. Some types of contracts will require close examination to identify where the employer duties lie eg. for agency workers or contractors.
Business Software and Systems Processes
Many of the functions necessary to comply with automatic enrolment duties are process-driven. Business software (eg. payroll, HR and pensions administration) should be set up to automate the majority of these processes, such as monitoring ages and earnings of workers and deducting pension contributions.
Review Pension Arrangements
You may have existing pension schemes you want to use for automatic enrolment. These schemes will need to meet certain criteria, which could involve changing the scheme rules or terms and conditions. You’ll need to understand how the new legislation fits with existing pension arrangements, such as salary exchange or contractual enrolment.
There is a range of information that you are required to provide to your workers, such as providing them with financial information about the contributions that they and you may be making towards their pension. Some information must be sent individually to each worker as well as making sure the right person gets the right information at the right time (eg. if they change worker category).
There are certain employer duties you must comply with. If you fail to comply with your duties The Pensions Regulator may take enforcement action and issue a notice and or a penalty.
You are required to complete a declaration of compliance for The Pensions Regulator to inform them what you have done to comply with your automatic enrolment duties. The duty to complete the declaration of compliance lies with the employer and needs to be completed within the five months following your duties start date.
Information in this article is based on our understanding of the relevant legislation at the time of writing (October 2018). For further information visit The Pensions Regulator website.