Most company employees unsure about auto-enrolment

More than half of workers find the term auto-enrolment confusing and could not say what it relates to, research finds.

A further one in four people (27 per cent) are still in the dark about what the changes mean for them and their retirement, according to a study conducted by Sage.

A quarter (25 per cent) have not received any information from their boss on the changes to workplace pensions, equating to as many as 300,000 UK businesses.

With around 11 million people in the UK to be automatically enrolled onto a workplace pension, the survey suggests as many as 6.1 million are confused about auto-enrolment.

Automatic enrolment was introduced in 2012 and is the government’s flagship legislation to solve the UK’s £28 billion pension black hole. It requires employees to automatically enrol all eligible employees into a pension scheme requiring contributions from both employer and employee.

For 225,000 firms this will be the first time they will have offered a workplace pension scheme.

When workplace pensions and auto-enrolment were explained to respondents, more than three quarters (76 per cent) stated they agreed with the changes being introduced.

However, 35 per cent indicated they wished their employer had provided them with more information.

Lee Perkins, managing director of the start-up and small business division at Sage UKI says, ‘The way we save for retirement has transformed in recent years, but the lack of awareness about the change is a major concern.

‘The fact that there is such confusion and ambiguity surrounding the term auto-enrolment means the language surrounding workplace pensions needs to be looked at and considered carefully.’

In 2014, businesses with between 60 and 350 employees will reach their staging date and begin to automatically enrol any eligible jobholders meaning as many as 50,000 firms will enrol their employees.

Progressively smaller and smaller businesses will then be required to offer a workplace pension to their employees in a phased rollout known as staging.

Further reading on auto-enrolment

Ben Lobel

Ben Lobel

Ben Lobel was the editor of from 2010 to 2018. He specialises in writing for start-up and scale-up companies in the areas of finance, marketing and HR.

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