Start planning for auto enrolment today.

It’s never too early to start planning! The sooner you start, the smoother the journey will be in meeting your auto enrolment obligations.

I learnt just how important good planning is when I embarked on a move from our offices in Cardiff to Kingswood last year. I felt confident that eleven months of planning would be a good foundation to smooth the anticipated pressure of moving day. Oh how wrong I was! In retrospect, I wish I'd started earlier.

That’s why I encourage you to start thinking about auto enrolment as soon as you possibly can. The pensions reform intends to encourage 7 million people to start saving as early as possible, to ensure they have enough income in retirement.  For all employers out there, it's never too early to start planning for the changes you face because, like my moving day, you will not have enough time to do everything you need to for your staging date. You will also need to adhere to the regulations from that day onwards and be able to show you're following the rules.

• Get to know when auto enrolment will impact your business
• If you need to make any changes to facilitate auto enrolment, you may need to make sure these are put in place ahead of your staging date
• Understand the decisions you need to make and consider them carefully. From choosing the right default fund, to ensuring that you’re not in breach of the law by unduly influencing the decisions made by your employees. Planning ahead is key.

Here are my suggested Top 5 employer decisions:

1. 1. Firstly, understand the cost of auto enrolment and then decide how you will plan to meet any increased pensions costs when they become due
      
      
   2. Then review the current pension for your employees and decide what you will provide and how you will structure your arrangements going forward. Have you already got a qualifying scheme? If not, it could be a good time to get one!
      
      
   3. Choose a default fund suited to your employees' likely risk and return profile
      
      
   4. Review your contribution entry levels and ensure they meet the minimum requirements or more
      
      
   5. Choose and implement the right business strategy and framework. Ensure you have the appropriate processes and communications in place to meet your obligations. For instance:
      • Assessing and enrolling your employees
      • Providing your employees with appropriate information at the right time
      • Figuring out how you'll manage regulatory reporting and how you'll deal with re-enrolment every 3 years

As more regulatory detail and guidance is provided, you will need to keep reviewing your plan and assumptions to make any necessary changes.

We're happy to provide support and advice to achieve the best outcomes for your business and for your employees.

Michelle Parker, Auto Enrolment Readiness Manager, Service Centres

Important note

This article provides the views of our auto enrolment team. The views are the opinion of the person writing the article and don't necessarily represent the views of Legal & General. They are based on their interpretation of industry developments and their current understanding of UK proposed and actual legislation, and should not be interpreted as recommendations or advice.