We believe My Auto Enrolment is the fastest and most cost-effective way to handle your automatic enrolment pension staging process… but it’s not the only option.
In January 2015, the Department of Work and Pensions released research findings into the experiences of employers who staged in 2014.
Some larger companies chose to pay for independent, professional advice –while others had attempted to navigate the process for themselves, using the Pension Regulator’s guidance and other online advice.
For companies researching auto enrolment from scratch, the problem is not that there’s too little information; there’s too much. The employers’ section of the Pension Regulator’s website alone totals 181,662 words of advice, around the same length as Charles Dickens’ Great Expectations. For the average person, the estimated reading time is over eleven hours.
My Auto Enrolment eliminates this research requirement. The step-by-step instructions are prepared by Chartered Independent Financial Advisers, giving you the right information to understand each question as it arises.
“Even quite basic questions I couldn’t get my head around. There was so much conflicting information on this subject on the internet.”– Employer, professional services, 350-499 workers*
Aside from the reading and research time, the process of assessing staff, identifying an appropriate pension scheme and ensuring compliance can be extremely time intensive – particularly for staff trying to complete the work alongside their usual job role, or with financial year end approaching.
“We complied on time, but only because I worked additional days and stayed until ten o’clock at night. We complied, but at that cost.”– Employer, health and social care, 62-89 workers*
Indeed, the DWP report estimates a workload of up to a full day per week, for two to three months leading up to staging.
My Auto Enrolment simplifies the process, and automates time-consuming tasks such as assessing which workers are eligible, calculating pension contributions and comparing pension providers’ costs.
As a result, some companies will be able to complete the entire process in as little as four hours – whether in one go, or saving and returning as workload allows.
Top causes of heavy auto enrolment workload:
- High number of employees who are not already in a qualifying workplace pension
- Varied workforce, with differing ages, earnings or contractual arrangements
- Workers’ earnings change seasonally, or with bonuses
- Lack of previous experience with workplace pensions
Risk of non-compliance
As well as staging on time, correctly assessing staff, calculating contributions following procedure and meeting safeguards about avoiding incentives to opt out, there are deadlines to meet and records to keep, both in the run-up to staging and in the months and years that follow.
My Auto Enrolment is designed to make compliance straightforward. You’re led carefully through the correct process, the calculations are done for you, and all the relevant letters and records are only a click away. We’ll even send you reminders when there’s something to do.
“Most employers found the guidance they needed to follow, in order to comply with their legal obligations, relatively difficult to understand.”– Department for Work and Pensions*
The penalties for misunderstanding the auto enrolment rules are potentially severe. Employers can be liable for backdated contributions – both their own and their employees’ – along with fines that rise on a daily basis.
Did you know?
Detailed records of any employees’ decisions to opt out must be kept for a minimum of seven years.
Advice at a premium
Given the complexity and heavy time costs involved, it’s not surprising that some firms choose to seek help from professionals. However, good quality advice does not come cheap. Four figure fees are the norm – although higher prices are not unheard of for complex work.
By comparison, My Auto Enrolment – which includes independent advice from finance professionals – costs just £435 + VAT.
“Employers who did choose to hire an external adviser tended to find that this raised their costs into the low thousands. For a small number, the eventual cost was above £10,000.”– Department for Work and Pensions*
“You need to try and keep it as simple as possible.”– Employer, education, 160-249 workers*
* Source: DWP Survey, January 2015