Following a recent auto-enrolment update from the DWP (Department of Work and Pensions), they have predicted that by 2020, £17bn a year will have been put into workplace pension schemes as a direct result of auto enrolment.
They also predict that just over 10 million workers will be saving more money than they would have done previously, even outside of the workplace schemes.
The Government are also urging employees to put aside as much as they can during employment, so they have a better chance of enjoying a comfortable retirement when they finish working.
We have had many enquiries from our clients regarding this issue, so as an employer are you ready?
What is auto-enrolment?
Auto-enrolment is required by all employers to enrol their workers into a workplace pension scheme and contribute towards it.
If you are an employer who employs at least one person over 22 and earning at least £10,000 per annum, will need to pay into a pension pot on their behalf. If there is already a pension scheme in place that meets with current government standards, then this may be sufficient.
If you do not comply with the rules, you will be issued with a notice. The fines are as follows: if your company employs fewer than 4 people it’s £50 a day, but if there are between 5 and 49 employees it’s £500 a day.
Automatic enrolment has already begun, and it started with the largest employers in the UK, but all employees need to be enrolled into a scheme by 1 February 2018, at the latest.
The message is simple, if you are employer, don’t ignore the workplace pension, if you do you risk a hefty fine. Don’t panic though, HR Revolution has a put together a clear and comprehensive guide to pension and auto enrolment, download it below and get your house in order.
A version of this article first appeared on HR Solutions-uk.com