100 days to take care of Auto Enrolment
Auto Enrolment is the latest Government initiative surrounding workplace pension reforms. With an ageing population, and the realisation by Government that there will be insufficient funds available to pay for people’s retirement, they have set out the need to increase the number of people regularly paying into pensions, thus saving for their retirement themselves.
To date, Auto Enrolment has very much focused on getting the largest employers on board, however by 2017 all employers will fall under the new regime. The staging date is based on employee numbers disclosed by the employer on 1 April 2012.
All businesses should have received details of their staging date (the point at which you must be ready to comply) and whilst for many SMEs this date may be 2015 onwards, industry experts are suggesting that there is a significant amount of work involved in preparing for and administering Auto Enrolment on an ongoing basis (one source is suggesting an additional 100 days will be required each year just to fulfil its requirements).
SMEs are once again bearing the brunt of additional costs with little benefit to them, particularly with the recent introduction of Real Time Information (RTI). However unlike RTI, it is not simply a case of applying a software upgrade – the new Auto Enrolment regulations place a much greater emphasis and responsibility on the employer.
Preparation is key to ensure your business is ready for Auto Enrolment and the amount of time initially required should not be underestimated, neither should the amount of time required on an ongoing basis. Can your business sustain this additional burden? The chances are the answer is no and we would therefore recommend businesses should look to their payroll providers as a possible outsourced solution.
For more information please contact our payroll manager today on 02476 518 555.