Get ready for Auto Enrolment and be aware of a few pitfalls before you embark!
- Don’t confuse your staff benefits – If part of an employee’s remuneration package includes the benefit of a non-contributory pension scheme, they may find themselves now having to contribute – or choose to opt out of the scheme.
- Keep an eye on your pension contributions – Auto enrolment could change the % pension contributions made by employers and employees – ensure you are not unfairly penalising employees against their contract.
- Don’t overlook the small print – Employers should research employment law when changing pension contracts for existing employees.
- Don’t work with the wrong data – As tempting as it is to plan ahead, ‘trial’ auto enrolment runs do not make ‘go live’ easier as all criteria processed is date dependent.
- Get your housekeeping in order – Legacy or tiered pensions schemes and/or multiple PAYE schemes can cause employers to have a portfolio of redundant or infrequently used pension schemes. Employers should take the opportunity to rationalise their benefit packages.
- Don’t ASSUME – The People’s Pension and NEST do not communicate with employees who are not opted in or have opted out – Employers need to fill this gap.
- Keep everyone in the picture – If an employer postpones or delays new starters the pension provider will not know of their existence and will not communicate with the employee.
- Don’t rely on hearsay and smoke signals – Include auto enrolment notification periods & criteria as part of your new employee contract of employment/handbook. This should include delayed start criteria and opt out information routes. Make sure you set the table before an employee starts working for you.
