A question that sits on the tip of the tongue of so many. Not yours? Oh. Well you’re missing a trick, then. Let us explain. We’ll start from the beginning. What is a workplace pension? It’s basically a way of…
For a long time, the government has been trying to encourage the UK population to put money aside for their retirement. To save. Thing is, it hasn’t been working very well.
Apparently seven million of us in the UK are not saving enough for retirement. Most people haven’t been opting in to their employer’s pension schemes and nearly all have been spending their money on fast cars and diamonds. That last bit isn’t actually on the government website, but you get the idea.
So the government is mixing things up a bit. It has introduced a new law that means employers are now obliged to automatically enrol eligible* employees into a workplace pension scheme, without them having to take any action.
Basically, workplace pension schemes now legally have to be opt out, rather than opt in. It’s called, you guessed it, ‘automatic enrolment’.
“Workplace pensions are here. Act now. It’s the law.”
– The Pensions Regulator, 07.01.2016.
As an employer, you must contribute at least 1% of an employee’s earnings to their pension. The employee will then contribute a minimum of 0.8% and the government 0.2% in the form of tax relief.
Your ‘staging date’ (the date when you will need to get your act together and start enrolling your employees) will depend on the size of your business and on how many of your team are eligible to be enrolled.
You actually might have already received a letter telling you when your staging date is. You also might have lost this letter, or screwed it up and put it in the bin. Never mind, we found this cool (and free) planning tool on the Smart Pension site that will work it out for you.
There are four things that could happen, none of which are ideal really.
Ouch? Yep. It’s all very expensive and really quite avoidable.
Feeling overwhelmed? We’ve got your back. These are the four things you need to remember to do before you get started.
Provide The Pensions Regulator with the contact details of your CEO or MD. You can do that here.
Find out when your staging date is. You can do that here.
Find out who you need to enrol. See *
Find someone to help you to get going.
We’ve done our research and scoped out the quickest and easiest ways to take the admin off your hands. Like a big experiment, or maybe a competition.
We suggest you check out Smart Pension. We’ve tested out their online platform that is designed specifically for auto-enrolment and easy management of every aspect of the scheme and these guys have really got it down. It was fast, easy and didn’t cost Perkbox a penny. Winner.
Auto-enrolment is something you’ve got to do – it’s a legal obligation. But truth be told, employees will massively benefit from it too. So why not capitalise on that?
Position it as a reward, use it as a motivational tool to show your team how much you value them. Basically, sell it as a perk! After all, you’re giving them money for the future, right?
We’d suggest throwing a big knees up, a shindig in the name of, well, pensions. But if you’re a bit low on resources or creative juices, we’ve got something for you.