Auto-enrolment: time to blow off the dust
Let’s be honest. Auto-enrolment is boring. Employers comply with it because they have to. Even those employers who have conscientiously sought to give their employees appropriate pensions would not have chosen the highly prescriptive method set out in legislation for their benefit design.
Is it a chore or is it engagement?
Consequently, most employers have approached this as a question of compliance rather than with whole-hearted engagement. They found out what they needed to do and put that into practice. From that point on auto-enrolment became a chore, to be given strategic attention only when the employer reaches one of its periodic re-enrolment dates or when other changes are being implemented that might have a knock-on effect on auto-enrolment.
The grunt work is done by junior administrators in accordance with processes that have not been properly reviewed in years. The junior administrators in many organisations are not pensions professionals but payroll professionals.
Let’s take stock
- Auto-enrolment is boring,
- Very technical, important, given minimal attention by seniors,
- Administered for years at a time by overworked juniors with no specialism in the area, and
- Getting it wrong can lead to fines and major reputational damage for the employer if there is non-compliance.
- In other words, at many employers it is a disaster waiting to happen.
Evolving process a help or a hindrance?
It’s not that the original processes were necessarily poor. Far from it, employers took a lot of time and care at that time. No, the problem is that with the passage of time administrative practices may have evolved on the ground away from the legislation or the employer’s own benefit changes have not been fully incorporated into auto-enrolment in a joined-up manner. With staff turnover, the danger of transcription errors in process is greatly increased, even if juniors were carefully and fully briefed when auto-enrolment systems were set up.
How we can help
At Pinsent Masons Pensions Services, we offer a service to:
- Review process against legislative requirements
- Streamline processes
- Document processes
- Help to educate HR and payroll professionals
7 Feb 2020