EMPLOYERS STILL IN THE DARK ABOUT AUTO ENROLMENT

EMPLOYERS STILL IN THE DARK ABOUT AUTO ENROLMENT

77% of companies don’t know when they have to introduce auto enrolment

One in 10 employers have not considered what needs to be changed to respond to the requirements of auto enrolment

Auto enrolment will have significant implications for employee engagement and understanding

More than three quarters (77%) of UK companies admit they don’t know when they have to begin auto enrolling their employees into a qualifying pension scheme, according to research from the Financial Education division of Close Brothers.

Although the new legislation making employers liable for providing a basic workplace pension comes into force from 1st October 2012 the system will be rolled out until 2016, based on the size of the business. Yet the study revealed that more than one in 10 (11.6%) of companies haven’t considered what needs to be changed.

Jeanette Makings, Director of Financial Education Services at Close Brothers, said: “It’s essential that employers take an active role in communicating the new pension choices to their employees to make them aware of the need for and benefit of saving more for retirement. Auto enrolment aims to create a UK-wide pensions system for all workers, transforming the savings landscape.

“Workers will be looking to their employer for guidance, which is why introducing a programme of financial education is essential. This way, employers can take an active role in informing employees of the benefits available to them, as well as helping their workers plan for a more secure financial future.

“Employers have a requirement to provide a pension scheme for their eligible workers, and a responsibility to ensure that their employees understand the choices available to them under the new system before it is introduced.”