Auto-enrolment: The importance of employee engagement
First introduced for very large businesses in late 2012, auto-enrolment legislation dictates that most UK employers must put in place a qualifying workplace pension scheme, automatically enrol their qualifying workers and inform other staff of their pension rights. Employers then have to make contributions to their workers’ pensions every pay period.
Since 2012, many more businesses have reached their ‘staging date’ – the point at which they have to confirm pension rights to all workers and enrol qualifying employees into a workplace pension scheme. The staging date is determined by the size of the business and with auto-enrolment now in its 5th year, more Employers will of course be approaching their own staging date. We are also seeing many Employers now approach their ‘re-enrolment’ date, which brings further duties.
The Pensions Regulator offer some guidance for Employers understanding their legal obligations as part of auto-enrolment and clearly this is paramount for any eligible business. These include the staging date, eligible (and entitled) workers and minimum contributions, amongst others – and it is important to remember that non-compliance can result in fines.
However, there is more to a successful enrolment than simply meeting obligations. People-centric businesses must understand the options available to them and the choices that they can make to best meet company objectives. What would your staff value the most? After all, this is a decision which could have a major bearing on the morale, engagement and long-term financial stability of employees.
Time to engage
G+E Wealth Management has been involved with auto-enrolment from the outset and we have learnt a lot over this period, not only about the best pension schemes but also what works well for different organisations – including the value of positive engagement with staff.
Above all else, it is absolutely vital to make sure your staff are clear before your staging date what will happen with auto-enrolment, why and from when.
It is also important to make sure your staff fully understand and appreciate all the benefits of your chosen pension scheme, particularly where the pension scheme is with a lesser known provider. The value of independent pension scheme governance and the reassurance this provides cannot be underestimated, particularly in light of high-profile media coverage for pensions scandals in recent years like BHS.
Ultimately, this is about communication. Work with G+E Wealth Management to understand both your legal obligations and the choices available to you – but don’t forget the all-important two-way communication with staff. Get it right and auto-enrolment should prove to be a positive tool for engagement and staff morale.
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