A recent poll by Scottish Widows has found that barely half of British employees are aware of the recent implementation of pension auto-enrolment. The news highlights the need for improved communication and education from the Government, pensions industry and the clients of HR services like those offered by Employee Management Ltd (http://www.employeemanagement.co.uk).
The scheme involves staff members who are not already part of a pension plan being automatically included in their employers’ workplace scheme. The Government has introduced auto-enrolment to encourage more retirement saving from workers, with the change having already come into effect on 1 October 2012 for businesses employing more than 120,000 employees – in other words, some of the largest workforces in the UK.
However, despite plans already being in place to stagger the staging dates for other organisations to auto-enrol their employees over the coming years, the Scottish Widows survey of 5,200 workers found only 52 per cent worker awareness of auto-enrolment. Of these respondents, 61 per cent had learned about the changes via the media, as opposed to the 16 per cent who had first been informed by their employer.
Lynn Graves, head of business development, corporate pensions at Scottish Widows, commented: “It is shocking that there remains such a huge gap in awareness, and that the media has had to step in to play a pivotal role in educating people about these changes.
“Auto-enrolment is designed for people who traditionally don’t have access to a workplace pension scheme, such as smaller employers or those with lower incomes, and it is clear that information is still not reaching the audience it’s intended to target.”
Her words echo those of Workplace and Retirement Income Commission member and former Sainsbury’s HR director Imelda Walsh, who last year asserted the importance of the value of retirement saving being “relentlessly” communicated by the clients of HR consultants.
Meanwhile, companies that make use of human resource consultants may also be interested in separate research by Baring Asset Management, which found that employers were actually the least popular source of pension advice.
The study found an increasing tendency for workers to seek retirement funding advice from family and friends, with 23 per cent of employees citing this in 2012 – as opposed to a mere 15 per cent last year. Employers were at the bottom of the overall list, with just 9 per cent, below the 15 per cent recorded for bank managers. Independent financial advisors or accountants topped the list, with 34 per cent.
Employee Management Ltd (http://www.employeemanagement.co.uk) has a strong track record in helping businesses to adapt to new legislation and implement compliant policies and procedures. Get in touch with our HR specialists today for more information on the impact of pension auto-enrolment on your own firm.