If you, like many other employers, read the title above and thought “Oh it can wait!” then you really need to read the rest of this article. Automatic Enrolment is happening and you must be ready with the correct information on the law and your requirements as if you don’t you could face some pretty hefty penalties and fines! Our advice? Get some help while it is still available as one mistake could cost you dearly!
To relate the problem of the new pension law to another industry, consider the following example: What if similar regulation was hitting the building industry? If the government announced every householder by law requires a loft conversion with a raft of minimum regulations (size, people who have to sleep in it, people who can ask to sleep in it and cost etc.) you might think the builders jumped up for joy at the announcement. They probably did, until they realised that building thousands of loft conversions is somewhat different to the 24 conversions a year they are used to and read they cannot charge more than a certain amount. They know they cannot say yes to everybody who will need their loft converted and so they booked in as many conversions as they were able, knowing the dates the government were requiring the conversions to be done by. The builders could then pre-order the materials required to align their services to the order book. Consider the householder who didn’t book his conversion with a complaint builder; who thought he had until April 2017 to worry about it. He will phone the builder along with the 110,000 other householders that month to be told their order book is full and cannot fit them in. Never mind he thinks, I’ll build it myself and read the rules and materials required. That is until he turns up at Wickes behind a queue of 110,000 – some of whom have pre-ordered their materials. He hadn’t and Wickes confirm they sold out of all their stock to the first 10,000 in the queue. The householder has no builder and no materials – he will have to ask the government to help, who are busy on the phone to 100,000 other householders!
Replace householders with companies, Builders/Wickes with Pension Professionals/Providers and you get the very real situation that will play out towards the end of next year. The added complication is that the loft conversation has to be checked every month for compliance and even re-built every 3 years!
Generation Financial have helped almost a hundred existing clients and new employer clients through the minefield of Automatic Enrolment and we are happy to continue offering this support to all our connections. Take our advice and don’t leave it too late as you never know when our order book will be full.