How are companies preparing for auto-enrolment contributions changes in 2018?

We’re delighted to welcome our panel of senior HR directors to the Punter Southall Aspire blog for a second series to share their practical experience delivering pensions programmes to thousands of members. For this, they tell us how their company is preparing for the changes in auto-enrolment contributions in 2018.

lightbulbOn April 6, 2018, staff will have to contribute up to 3% (up from 1%) and employers will have to contribute a minimum of 2% (up from 1%). These minimums will rise again in April 2019.


“We already pay above the minimum” 

“This is on my radar, but it won’t affect many of our employees. Our minimum contribution is already above the minimum for auto enrolment and is generous.

“Sadly, the minimums the government has set are woefully inadequate for pensions savings, even with the current rise. Our people are happy to pay more, but we are in financial services so our cohort is mostly already in their 30s or older, and have the disposable income to put into their pensions. 

“If we do anything around the change in automatic enrolment minimum contributions, it will be to point out that our staff are lucky that we pay an employer contribution above the minimum!

Penny Hathaway, HR Reward Manager, THB Group

       “This will put pressure on smaller companies”

“Thankfully we don’t have to. We are already contributing more than the minimum.

“But for businesses where that is not the case, it will put pressure on them, particularly the smaller ones. They may see more people squeezed out of pensions. It’s very important to continue sending home the message of how important pensions are. In an ideal world, increased pension contributions would go hand-in-hand with salary increases, but most businesses will not be in a strong enough position to do that.”

Sally Cheeseman, HR Manager, Inspectorate International

“We have to work out how to fund this change”

“This will affect the majority of our workers in the UK. We will need to communicate it in good time. We haven’t started doing that yet, but will time it to coincide with pay reviews. This is a good time to talk about increases in pension contributions. We will focus on communicating the essential facts.

“Inevitably in any population there will be some who won’t see the benefit of increasing their contributions and a few might exit, but they will be re-enrolled within 2-3 years. I believe that most people understand that they have to provide for later on in life.

“In addition, the increase in contributions carries a cost for the company. We have to work out how to fund this and manage the cost to our business.”

HR Director of food company

“Staff need to be reminded before this happens”

“This will bypass us in 2018 because our minimum contributions are already higher, but will hit us in 2019.

“At that point, we will individually target those paying less than 3% and give them a six-month reminder that they will have to increase their contributions. I hope that by reminding them, as well, when their salary reviews take place, that no one will be surprised when the change comes in.

“I’m not necessarily worried about people opting out as a result of the minimums changing. The only times I’ve seen opt-outs are when people have personal pensions running and after taking financial advice, decide they are not interested in their company pension.

Morag Bailey, HR Director, Ardo

“This won’t affect us”

This mostly doesn’t affect us as our contribution rates are in excess of the minimum.”

Roanne Gibbs, Head of HR, BMS


Posted by John Buttress

Topics: HR Panel


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