Auto-enrolment legislation will impact almost every employer with a high proportion of the pension schemes currently in place being either unsuitable or unlikely to meet the new criteria imposed. The legislation requires all employers to auto enrol all of their eligible employees into a qualifying scheme resulting in additional duties and workload. We can work with you to establish and administer your pension schemes on a salary sacrifice basis. We’ve partnered with a local company who are authorised and regulated by the FCA as Independent Financial Advisors. They will work with our clients to develop, implement and manage corporate and personal Pension Schemes ensuring you have the best plan in place.
A recent client re-structured their pension scheme and moved to a salary sacrifice contribution model.
As a result of the savings in NIC’s the company has introduced a whole range of additional benefits including a flexible benefits package, private medical insurance, child care vouchers, group income protection and an employee discount club. In addition to researching and implementing the changes the financial management company also conducted one to one advice on the impact on each member, group presentations, intranet pages, employee benefits brochures and plain English newsletters.
What is automatic enrolment?
The law on workplace pensions has changed. Every employer with at least one member of staff now has new duties, including putting those who meet certain criteria into a workplace pension scheme and contributing towards it.This is called automatic enrolment. It’s called this because it’s automatic for your staff – they don’t have to do anything to be enrolled into your pension scheme. But it’s not automatic for employers - they need to take steps to make sure they’re enrolled.
When will the change in law affect our company?
Each employer has a date by which they need to comply with the law. This is called your staging date. If you don’t know your staging date, please contact us for help.
What does our company need to do and by when?
There are a number of tasks that will need to be completed by your staging date, including assessing your workforce to see who’s eligible, choosing a pension scheme, and communicating to staff. Contact us for help on how to prepare and to find out what you need to do and by when.
Is everyone being enrolled into a workplace pension?
By law every employer has to enrol into a workplace pension, workers who:
Why is this happening?
The aim is to help more people have another income, on top of the State Pension, when they retire. The State Pension is a foundation for your retirement. If you want to have more, you need to save during your working life. Otherwise, you may reach retirement facing a significant fall in your standard of living. The government is getting employers to enrol their workers automatically into a pension at work so it is easier for people to start saving.
Who will pay into the pension?
You will pay into it. Your employer will pay into it too. They have to do this if you earn more than a certain amount. Plus most people will get a contribution from the government in the form of tax relief. This means some of your money that would have gone to the government as tax, goes into your pension instead.
I’m paying into a personal pension already, what should I do?
It’s possible to have both a workplace pension and your own personal pension, so you could choose to continue paying into both. Or you might choose to continue with just one of them. It depends on your circumstances - for example, what you can afford and what your personal and workplace pension schemes are offering. With your workplace pension, you will receive a contribution from your employer that you won't get with your own personal pension. However, your own personal pension may have a guarantee about future income.