Small businesses discover hidden benefits of auto enrolment after implementation
Research from Barclays Corporate & Employer Solutions reveals British SMEs are finding more benefits to auto enrolment after their staging date than initially expected. Only a quarter of businesses (25%) that have not yet auto enrolled believe that the new requirement is a positive benefit for small businesses, with this figure more than doubling (54%) once they have been through the staging process.
The research polled over 2,000 senior decision makers from small and medium sized businesses on their latest outlook and experiences of auto enrolment. Of those that agree auto enrolment is positive for small businesses, they see improvements in employee engagement, attraction and retention of staff and even productivity.
Decision makers from Generation Y in particular (aged 25-34) show a favourable attitude to auto enrolment, with almost half of the demographic (46%) believing its implementation to be a positive benefit for small businesses, significantly higher than the 31% of Generation X (aged 35-54).
However, there is concern over small businesses’ ability to meet on-going governance requirements. One in four (25%) senior decision makers in companies with 50 employees or less believe that the knowledge of the business on both pensions and pensions regulation is poor, with an even greater number (28%) considering their own knowledge to be of an equally low standard.
Levels of confidence also vary between the genders with 40% of male business decision makers in SMEs rating their grasp of pensions and pensions regulation as good or excellent, compared to only 29% of females. The cumulative effect is that only just over half (55%) who are yet to enroll have the confidence that they can meet all the on-going legal obligations of the process.
The research also finds that most businesses draw on assistance when navigating auto enrolment, with three quarters of businesses who have staged (75%) engaging in some form of external support to help implement the process.
Petaurum Solutions’ Comment
It is encouraging to see so many businesses realising the advantages of auto enrolment after implementation. While workplace pensions have clear benefits for employees, they also present an opportunity for businesses to use them as a tool for employee engagement, and we are increasingly seeing businesses establish them as the foundation on which to build a broader benefits package.
However, while businesses are becoming increasingly positive towards auto enrolment, it is important that they approach the process correctly. We have seen how easy it is for all decision makers to underestimate the complexity of the process and the time it takes.
Complying with complex Auto Enrolment obligations can be a daunting prospect for many small and micro-sized business. Choosing a cost effective, long-term implementation solution is critical for these businesses to ensure they do not become swamped with the processing requirements and responsibilities that Auto Enrolment can bring. Therefore, for businesses considering their solution, focus should not only be on the pension scheme, but also on how it will be administered, methods to communicate, impacts on systems and data collection processes along with any HR and Legal changes may you need to make.
Our Defaqto 5* quality Carey Master Trust Pension Scheme, comes with best in class assessment and communication software and is part of our SME specific, competitively priced end-to-end solution that will take care of the above, leaving you free to manage your business safe in the knowledge that your Auto Enrolment obligations are in professional hands. Want to know more? Then feel free to download our info pack here, or contact us to secure your PAE future.
This information is intended as a general overview and discussion of the subjects dealt with. The information provided here was accurate as of the day it was posted; however, the law may have changed since that date. This information is not intended to be, and should not be used as, a substitute for taking legal, HR or benefits advice in any specific situation. Petaurum Solutions is not responsible for any actions taken or not taken on the basis of this information. Please refer to the full terms and conditions on our website.