From today, workforces with fewer than 30 employees will start to be phased into the Government’s automatic enrolment scheme, which was set up amid fears that people are living for longer but are not putting enough money aside for their old age.
Around 14,000 small and micro businesses will be reaching their staging dates to automatically enrol their employees in a workplace pension scheme.in June, with tens of thousands more coming on board over the next two years, according to the Pensions Regulator.
Smaller firms such as hairdressers and grocers will be included as the scheme rolls out. In some cases, people may be employing just one person such as a nanny or a carer. Employers persistently ignoring their auto-enrolment duties could ultimately face fines.
The scheme started in autumn 2012, with the largest companies, which tend to have the most experience of pensions and explaining their benefits to workers, joining up first, followed by medium-sized companies.
More than five million employees have already been placed into workplace pensions and eventually as many as 1.3 million employers will have automatically enrolled up to 10 million eligible workers into a workplace pension scheme.
The Federation of Small Businesses wants the Government to continue the support for small businesses to meet the challenge of auto-enrolment. Small businesses can find more information on the Pensions Regulator’s website.