THE CLOCK IS TICKING .From October 2012, the UK Government will implem...
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National Employee Savings Trust (NEST) - Employer Information

NEST - Employer Information and Support
Published on: Mar 3, 2016
Published in: Business      

Transcripts - National Employee Savings Trust (NEST) - Employer Information

  • 1. THE CLOCK IS TICKING .From October 2012, the UK Government will implement its So what is best for your business, an exempted scheme ornew pension initiative to the UK as part of its overall pen- NEST? Points you should consider:sion’s reform strategy. National Employment Savings Trust(NEST) previously known as “personal accounts”. The pro- -The maximum contribution to a NEST is £3,600pa whichposals will require all employers to contribute to a pension means that higher paid staff or those wishing to make largescheme for each member of staff. pension contributions are unlikely to be fully catered for, resulting in an increased admin burden, as two schemesEmployees would be automatically enrolled into a ‘qualifying would need to be run side by side.pension scheme’; the enrolment will be phased in over 4years based upon a company’s size. The larger employers -It is likely that 2% of every contribution paid into the schemewill begin the process, with smaller employers eventually is going to pay for NEST scheme start-up costs, plus an an-joining from 2014. nual management charge. This is broadly similar with the cost of setting up a Group Personal Pension Scheme (GPP).Where employers have existing pension arrangements inplace that are equal to or better than the contributions and -If you only contribute to a pension scheme because you areterms of the NEST arrangement, they will be excluded from forced to, it will give the impression to staff that it was not partNEST. of your benefits strategy, making it a negative gesture rather than a positive intervention. Consider implementing changesEmployers therefore need to start making decisions now, as before the provisions are forced upon your what type of scheme best suits them and their em-ployee’s and when to implement a scheme. -The fact that NEST will be on total earnings could create extra admin work, if staff are paid on a variable basis i.e. withCurrently a gradual approach for most employers has been a bonus, commissions or overtime.adopted by implementing a scheme early and thereforefactoring in pay increases with a contribution to a pension -NEST will offer very few investment choices, unlike a GPPscheme. scheme and also who will provide advice to staff on NEST?You should now be deciding if you are going to adopt the CONTACT US:NEST scheme or implement an alternate pensionscheme. This will allow you to gradually phase in these Email andyselway@yourhrconsultancy.comrequirements or assess if your current scheme is orcould be exempt from NEST. Tel 020 8953 9485If you would like further advice and guidance around this Mob 07958 471021issue, please do not hesitate to contact us. WWW.YOURHRCONSULTANCY.COM

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