IMPORTANT shout out on pension changes from April 2018 While we did see a big campaign on TV and radio advertising workplace pensions over the last 3 years from DWP, not to mention the big hairy monster!
They say time flies when you are having fun and the the three years since Auto Enrolment came a reality has been lots of ‘fun’ for employers, pension and payroll providers, payroll software developers and employees as they get to grips with auto-enrolment.
The companies included in the early staging dates are now approaching their three-year re-enrolment window.
At a recent conference on Automatic Enrolment there was a great deal of discussion on what happens when the smaller employees begin to stage their workplace pensions.
The feeling was one that the smaller employers will not look at the pension provider and many will by default fall into NEST, looking to minimise the cost to their business. This is a completely valid course of action and with minimum contribution rates at 2% likely to make little difference.
Okay, so my business has staged for auto enrolment but I want to change payroll provider, isn’t that going to be a lot more hassle?
At Dataplan this is a question we are often asked and you may initially think so but in reality no. Company pension schemes have been around for many years and managed payroll services are usually adept at taking on customers with complex and multiple pension schemes.
To date the introduction of workplace pensions under the new automatic enrolment has been a relative success with millions of employees enrolled. The number of employers affected has been relatively low.
There is a big change on the horizon though once the staging dates arrive for smaller (sub 50 employees). At this point the number of employers affected increases dramatically.
Sounds simple enough right? “Just tell us the calculation” I hear you shout, but it’s not that easy. Each company has their own rules surrounding their pensions and therefore different ways of calculating it, particularly if the company had an existing pension in place that qualified for the new law and so didn’t have to change it.
As we all know thanks to Theo Paphitis and his “we’re all in” advert, companies up and down the country are going through a massive and universal change; Auto Enrolment. Workplace pensions will be taking effect in every business gradually over the next few years, and as such each corporation has a staging date when their Auto Enrolment will take effect.