Automatic enrolment 

How to help your smallest clients through staging

This article is part of
Guide to automatic enrolment

How to help your smallest clients through staging

Britain's smallest firms are going through their staging process now and, according to some respondents to this guide, this tends to be the group which needs the most help.

According to Chris Daems, director for Cervello Financial Planning, says there are "specific factors" in helping smaller employers comply with auto-enrolment, as these are the employers which are less likely to have sophisticated payroll, HR or accountancy resources in-house.

Mr Daems says: "The first is to ensure everyone involved in auto-enrolment is clear on the tasks they need to complete."

Motivating employers to do their duty is also an imperative, says Andy Agathangelou, founding chairman of the Transparency Task Force. 

He comments: "The most important thing to do is to motivate employers to take action in a timely way, and that will often need robust communication which makes it clear what the consequences of non-compliance are."

Moreover, according to Glynn Jones, divisional director for group savings and investments at LEBC, many financial advisers have "mostly exited" auto-enrolment, which means employers without in-house payroll and HR functions will need the very best information available to help get them through the staging process.

He says: "A few [advisers] remain and are set up to advise on a wide scale, through introducers such as accountants and payroll bureau, but many schemes are set up without advice from a financial adviser."

Automation and information

Technology is the big factor at play for any employer going through staging but especially so for the smallest employers, who may not be able to pay for independent advice.

Natanje Holt, retirement expert for Bravura Solutions, says: "Technology automation is the only answer, as smaller employers simply do not have the money to pay for the service, whereas advisers need scale in order to make it profitable."

Mr Daems agrees: "Automate as much of the process as possible. This usually includes using the most appropriate payroll software and sometimes project management tools to support the employer and the professionals with whom he has chosen to work."

Martin Olive, strategic partnership manager for Now:Pensions, says: "Inevitably, for most small to micro employers, auto-enrolment is a time-consuming burden and an administrative nightmare, especially since these employers do not always have the time, money or available resource to set up a suitable and compliant workplace pension scheme.

"Therefore, it is easy for directors of firms to bury their heads in the sand."

While Robin Armer, senior business development manager for NEST, agrees advisers need to do a thorough check to ensure the recommended provider will deliver the best outcomes, and has the appropriate badges of quality, he says there is more to look for.

He comments: "With a number of schemes attaining all or many of these badges of quality, we need to dig deeper.