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TEAM Blog

Auto Enrolment – Time Is Running Out

  1. Are you aware of your obligations for Auto-Enrolment ?
  2. Do you know what to do once you receive your Staging Date?
  3. Do you where to turn to for help?

The challenge which auto-enrolment brings is that it does not fit neatly into any existing box. It’s not payroll, it’s not HR and it’s not IT. Often it falls into the Finance box as it involves paying out money. If it’s finance, can your accountant help you? Sadly, it’s not that easy.

  • You need to find a provider - The most important decision around this is finding a provider who will be able to work with your existing systems and payroll. The last thing you need is to be told that you need to upgrade your payroll in order to be able to comply with the 280 plus of Pensions Regulator guidance. In our experience many accountants are not offering guidance to employers as to which provider can help them. Alternatively, clients are told to use NEST as it’s the government’s default option. This is true, but in our view there are serious concerns about using NEST as your auto enrolment provider.


  • You need to decide on a contributions basis – The second most important decision you need to make is the contribution basis you want to use. There is a choice of three; Qualifying Earnings, Basic Earnings and Gross Earnings. There is no ‘one size fits all’ answer to this question. There are a number of factors involved including the structure of your work force, how many temporary staff you have, how much employees are paid. We have seen examples where an employer was going to choose one basis over without understanding how these increase in the future and the effect this would have on their business.


  • You need a plan - To ensure that you get this right first time, you need a plan with clear dates in order not to miss out any of the steps along the way to your Staging Date. In this way, you have clear visibility of what needs to be done and by when. This includes sending the right communications to members at the right time, making sure your payroll data is accurate to pass across to your chosen provider and keeping an audit trail in order to complete the Declaration of Compliance after your Staging Date.


Don’t forget, you will have to go through a re-enrolment process all over again three years after your Staging Date, so it pays to keep a record of how you did this the first time round.

Don’t leave this to the last minute!

   

Michael Clark

Clark Benefit Consulting

Office: 0845 4334 199

Mobile: 07762 320 602

www.clarkbenefitconsulting.co.uk