If you run a business, there are a number of things you need to take into consideration as well as ‘simply’ the business itself. If, for example, you employ anyone, there are the salaries and benefits to think about. One of those benefits is the workplace pension, something that all employers should be able to provide for their employees, assuming they meet certain criteria. This can be a complicated subject, but it is important to work through the confusion and come to the right conclusion about exactly what to do and how to do it. Read on for your short guide on how to get started.
The Right Software
Before you can really begin to provide workplace pensions, you need to have the right software in place. You are going to need something that automates the payments, ensuring that each employee’s retirement account is paid with the correct amount on a regular (usually monthly) basis. This will often go hand in hand with your payroll systems, as all payments, benefits, and deductions can be done together.
Ideally, you will want a system that automates as much of the process as possible. The system at peoplexcd.com does exactly this, meaning you don’t have to concern yourself with the math involved; once it is set up, you can let it work through the process itself.
Give Your Employees Information
You can’t simply enroll your employees into a pension plan and not give them any information about it – they have to be given as much detail as possible, including:
- The date of the enrollment
- The name of the pension plan
- How much you are contributing, and how much they need to contribute
- Whether or not they can opt out and how to do so
It is entirely down to the employee whether or not they are happy to make contributions, but if they decide to opt out of the plan, this needs to be done formally with the request in writing.
Sometimes pensions change, and plans shut down or evolve in some way so they aren’t the same plans you enrolled your employees in to begin with. Even if they are actually better and provide a more valuable service, you will still need to communicate all changes to your employees. They will then have the right to decide whether or not to continue with the plan or opt out.
As an employer, it not your place to try to persuade any employee on this matter. They need to come to their own conclusion about whether or not they would like to be involved in the workplace pension. If they already have a private pension, or they are expecting a pension from another body such as the military or police because they once worked there, they may feel they don’t want to sign up to another one, since it will reduce the amount of money they take home each month. Conversely, they may feel that it is a good idea to have a number of pensions ready for their retirement.
You simply need to listen to their answers on the matter and ensure your HR software is programmed correctly.