If you run a business, you have probably read about or been approached about Auto-Enrolment, a mandatory scheme for all employers to ensure that their employees are part of a workplace pensions scheme by 2018. But do you know your business’s automatic enrolment staging date? Click here for a handy tool to help you!
Auto-Enrolment has already started, with larger companies and organisations now having to ensure that they provide an adequate workplace pension for their employees. Even though employees can opt out of any scheme an employer puts in place, the employer still has to make the adequate provision and offer of a workplace pension scheme, and this will require additional work and consideration by all employers.
Because Auto-Enrolment is being imposed in stages, many businesses have yet to confront the reality that they will be expected to accommodate it sooner rather than later. Already some companies have been fined by the Pensions Regulator for not meeting their obligations by their ‘staging date’ (the deadline for when the workplace pension has to be in place and to be offered to employees). It is easy to think that you will be able to quickly put such provisions in place before your deadline, but the practicalities are much more complex and onerous than that; if you have not already started investigating what your workplace pension obligations are, it may already be too late to get the right arrangements in place.
Accounting Web, a leading accountancy industry think tank and publisher, are so concerned that small businesses are not sufficiently aware of the existence or implications of Auto-Enrolment that they have now launched a “No-one gets left behind” campaign. Their main priority is to make sure people know that every single employer in the UK will be affected; records will have to be kept for 6 years, and there will be hefty fines or even prison sentences as a consequence for not getting this right.
It takes a lot of time and effort to set up and correctly administer a workplace pension scheme. One misconception that accountants hear from many of their clients (who are employers) is that they think it will take only between around three to six months to plan and implement a workplace pension scheme. The reality is that it takes typically 12 to 18 months to get a scheme fully up and running.
Workplace pensions and Auto-Enrolment is not just a minor regulation, a sort of tick-box activity which they can simply just join and pay lip service to; it is a legal requirement that the UK Government is taking very seriously in an effort to fend off a future pensions and savings crisis. The associated legislation is complex and will take time and effort to get to grips with. Auto-Enrolment needs to be a high priority for your business or as an employer, and you need to start looking for the right solution as soon as you can.
You may be an employer that already has a workplace pension scheme in place and this may in fact be compliant with the new pensions regulation. However, it is still incumbent on the employer to check whether or not this is actually the case. The Pay Pod can help you verify your existing pension provision.
As has already been mentioned, the UK Government is taking Auto-Enrolment seriously; employers are not allowed to encourage employees to opt out or to offer any inducement to do so. Auto-Enrolment and mandatory workplace pensions are not something even the most cunning or devious businessperson can duck or avoid.
But then again, why should you want to? Far from being a negative, workplace pensions should be seen as a positive benefit for your employees. If a company gets involved with the right pension scheme (another reason to get your business’s workplace pension sorted sooner rather than later), it could be a great recruitment tool.
Indeed, recent research suggests that the originally anticipated opt-out rate of 30% is actually going to be more around the 10%, so there is more chance than one would initially think that staff will want to participate in a workplace pension scheme, whether they’re mandatory or not.
One challenge that many businesses estimate is how workplace pensions are going to impact of the practical processes of their businesses. Is your current payroll system flexible and sophisticated enough to accommodate the payments needed as well as being able to display all the necessary information on your employees’ payslips? This is where The Pay Pod can assist your business in a cost-effective, professional manner.
At The Pay Pod, we are ready for Auto-Enrollment. You can talk to us about any areas of concern you may have; we can not only advise you but take the whole problem away by offering you a fully outsourced, compliant payroll process.
If you would like an informal, free chat about how we can help your business, contact us today.
The Pay Pod can manage your payroll and auto-enrolment allowing you to manage your business.
For further information and friendly advice, contact us today.