This is, of all weeks, the one to get clued up about pensions and auto enrolment. Pension Awareness Day – yesterday on 15th September – was dedicated to prompting people to think about their future; to shake their metaphorical money jars to see whether they are putting enough aside to enjoy retirement. It’s great that employees nationwide are being educated on their options, but there’s also an opportunity for employers to learn a thing or two about their pension provision obligations.
2015 has been a year of upheaval. Our ageing population prompted legislation a few years back concerning compulsory auto enrolment. In other words, employers would be compelled to enrol eligible members of staff into a pension scheme. Now the implementation is well and truly kicking in, and the new rules (and financial jargon) have come as a shock to many smaller employers. Auto enrolment has had a phased introduction: starting with larger companies, but now percolating down to SMEs. They are finding employees across the company have begun requesting information regarding their new pension provision.
So what do you need to be doing right now?
Well, the first thing to do is to know your staging date – the point by which auto-enrolment must commence for your company. If you are currently in the dark about this, it is important to learn yours as soon as possible (it may have already passed and penalties could be coming your way). You can find out your exact staging date by entering your PAYE number into The Pensions Regulator website.
Armed with this information you can start to plan. Budget for administration and the contributions you will need to make, think about the pension provider you would like to go with, and decide whether to organise it all yourself or outsource it. If you have a pension scheme already in place, make sure it’s one that’s compliant with current auto enrolment regulations.
By or on your staging date, make sure you’ve informed all staff about their pension options, and start enrolling those eligible for a scheme. Those who don’t wish to enter into a pension scheme, must do so in writing.
There are lots of options you could take in setting up auto enrolment for your staff and ensuring your legislative compliance. Unfortunately, though, there aren’t many designed specifically with small businesses in mind.
Warning! If you do no fulfil your pension obligations post your staging date, you’re at risk of receiving a hefty fine! £400 fixed penalty notices to start with, followed by subsequent greater penalties for continued noncompliance.
If you’re no pensions expert, you should seriously consider saving yourself the time and stress, by outsourcing and seeking advice. The HR Dept’s specialist auto enrolment and pension’s services are able to support, advise, and manage your duties, ensuring you avoid the fines and look after yours and your staff’s futures.