Sweeping changes to UK pension scheme will affect every UK employer and employee
Do you meet the minimum requirements set? Sign up for our 2012 health check
Even if we see a change of government before 2012, all parties have given their support to what is considered much needed change.
While the full proposal includes reforming the State Pension to cope with a massive shortfall in savings for retirement and make it easier for individuals to save, it puts a massive obligation on the employer. Employers will have to automatically enrol all employees including agency workers, fixed-term and part-time contract workers and anyone who undertakes work in the UK in the Government’s Personal Account scheme or your own scheme if it meets certain criteria.
Employers will then have to contribute a minimum of 3% of each employee’s eligible earnings to encourage the employee to add their own minimum 5% contribution to this.
Whether you have a pension scheme already or are thinking of getting one, you need to know whether you’ll meet minimum requirements that will allow you to ignore personal accounts legislation.
Why not sign up for Chesterford’s 2012 Health Check now?
We can help you plan ahead.
Advent of Personal Accounts means big change for employers and employees
Personal Accounts is the name of a legal requirement set out in the 2008 Pensions Act coming into play in 2012. It’s a new government-backed initiative for a national pension plan to top up the current state system and will mean big changes for employers and their eligible employees.
It will force many workers to save for their retirement for the first time and force their employers to contribute too, meaning greater operating costs for each business. There is no escape and each employer will be faced with auto-enrolment requirements.
We are finding that most employers are not yet aware of what’s going to be imposed on them from 2012 onwards and would advise that the sooner it’s addressed the more financial planning can be done in preparation for the event.