All of us are entitled to enjoy the benefits of retirement. The entire existence of modern pension plans is intended to provide us with the necessary financial “breathing room” once our working days come to a close. However, there are many instances when businesses do not provide their employees with viable options. It is likewise not unheard of for a worker to ignore such schemes altogether. The good news is that this is all about to change thanks to legislation that will come into effect on 1 February 2018. Employers will be legally bound to provide their workers with pension plans. This is known as automatic enrolment. Let’s take a look at what a recent survey has uncovered.
Facts and Figures: What do Employers Think?
In order to come to an understanding of how businesses are reacting to this plan, Bidivine has conducted a survey of more than 2,300 businesses throughout the United Kingdom. The findings are quite interesting and deserve a closer look. Here are some rather striking statistics:
- 35 per cent were uncertain of the definition regarding automatic enrolment.
- Two-fifths claimed that this scheme may impact their ability to hire new workers.
- 33 per cent have not yet complied with the stipulations required by the government.
The pool of respondents consisted of 2,319 small- to medium-sized businesses and the questions themselves were formulated by Bidivine. As Bidivine co-founder Russ Morgan observed:
“We wanted to get insight into what small businesses think about auto-enrolment seeing as it’s going to affect every employer in the UK. We were astonished to discover that many didn’t even know what it is!”
While these conclusions hint at a gap between governmental obligations and the needs of the business, we also need to appreciate how individual owners feel about this plan coming into place. Let’s briefly examine some additional findings worth noting.
Has the Necessary Support Been Provided and is this Scheme Popular with Businesses?
Bidivine included additional questions within this country-wide survey. For example, stakeholders were asked if they were provided with enough ongoing support by the relevant governmental organisations. Only 35 per cent answered yes. In addition, 66 per cent were unaware of the deadline itself. 43 per cent agreed with the compulsory nature of automatic enrolment and 31 per cent stated that it should be an optional programme.
What are the Implications?
It is worth mentioning that automatic enrolment will be gradually implemented. Larger organisations will be obligated to comply earlier (although the final cut-off date is still 1 February 2018). If a business fails to meet with these guidelines, hefty fines and even imprisonment can be the end results. However, the employees still have the ability to opt out of this scheme before the deadline passes. The concept of automatic enrolment can be an excellent way for workers to enjoy future financial security. It is nonetheless the responsibility of business owners to make certain that the necessary steps are taken in advance.