Monday, June 18, 2018

Auto-enrolment is Imminent- Do your Staff Know?

Scottish Windows

A recent study by pension plan company Scottish Widows has revealed that around half of British workers are unaware of the imminent arrival of auto-enrolment in the company pension scheme.

For larger companies the 1st of October is the day that will see their employees automatically enrolled into the company pension plan. This could come as a shock to those who are still unaware of the fact.

The Government introduced auto-enrolment because of the need for employees to start saving now for their pensions. There is to be a staged implementation into the scheme, with smaller businesses being the last to implement it. Businesses employing more than one hundred and twenty thousand staff will be the first to have auto-enrolment. Only fifty two per cent of the five thousand, two hundred employees asked by Scottish Widows whether or not they were aware of the schemes imminent arrival answered yes. Perhaps more worrying, was the fact that the large majority of those in the know had not been told by their employers, but had instead found out because of the media.

Lynn Graves, Scottish Widows' Head of Business Development, Corporate Pensions, said that the lack of employee awareness showed that employers needed to improve their communication practices. She commented that "with just three weeks to go until auto-enrolment comes into force, it is shocking that there remains such a huge gap in awareness, and that the media has had to step in to play a pivotal role in educating people about these changes." She added that it is often the larger companies that offer a pension scheme, and in times gone by a good one, so this is supposed to help those who traditionally did not have such access. This is supposed to help encourage the employers of smaller companies to save for their futures. In order for it to be successful, employers need to ensure that their staff are educated on the subject.

HR teams, particularly at smaller companies should be doing all that they can, not just to make employees aware of auto-enrolment but to promote the benefits of it. It would be useless if all staff once enrolled simply left the scheme. Unfortunately, a separate study by Baring Asset Management has revealed that employees tend to go to family and friends, rather than their employers, for advice on pensions or independent financial advisors.

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