Nine out of ten small businesses not ready for automatic enrolment
New study by IRIS finds that almost 90% of small to medium businesses are not prepared for workplace pension reforms being implemented across the UK
Industry experts are urging businesses to start preparing for automatic enrolment 18 months before their staging date, but despite this it seems that for many businesses this is the last thing on their mind. A recent study by IRIS Software Group – market leader in accountancy and payroll solutions – found that 59% of businesses surveyed felt unprepared for automatic enrolment, with this figure increasing to almost 90% when looking at smaller businesses (0-100 employees).
Automatic enrolment – the key component of the workplace pension reform – will mean that all businesses in the UK will eventually have to automatically enrol their staff into a qualifying pension scheme. Some larger companies have already begun complying with the change, with smaller companies having to follow suit over the coming months and years.
The date at which employers need to begin complying with automatic enrolment is known as a staging date and is based on figures taken from the employers’ largest PAYE scheme. The study from IRIS found that 53% of the small to medium businesses who took part had no knowledge of their staging date.
Mark Paraskeva, CEO of IRIS payroll division, commented on the results: “These figures are quite worrying, with such a lack of knowledge and preparation for such a huge change. We get the impression that many smaller businesses think automatic enrolment will not affect them or that they don’t need to worry about it yet. Experts are suggesting that employers start preparing 18 months before your staging date however, so a large proportion of employers may already be past this deadline and not even aware of it.
“There are a number of steps employers need to take in preparing for automatic enrolment, but the first of these is to find out your staging date. This is a vital step so you know how much time you have and can plan accordingly. The main piece of advice we are giving businesses is to educate themselves on the legislation, why it is being introduced and the effects it will have on their operations.
“IRIS is developing a complete solution to help businesses prepare, with training, guides and regular updates already being available. Our Earnie IQ product is already fully compliant for automatic enrolment and all other IRIS payroll software will be ready in the Autumn updates ahead of the first staging dates.”