The auto-enrolment pension’s legislation means that every employer in the UK must set up and contribute to their staff’s pension. All qualifying employees will automatically be enrolled in the schemes unless they choose to opt out, and non-compliance by employers can result in hefty fines and even prison sentences.
The deadline to set up a pension’s scheme is February 2018, but despite the hefty penalties for non-compliance, a staggering 35% of small business owners are still in the dark about the legislation. A recent survey, commissioned by online local services marketplace Bidvine.com found that a third of small business owners did not know what the auto-enrolment scheme was, with more than two fifths stating that the extra expense would affect the hiring of new staff in the future.
The survey polled 2,300 British small businesses and asked, ‘has your business already complied with pension auto-enrolment?’ more than a third (35%) of participants stated they didn’t know what auto-enrolment was, while a third (33%) answered that they had not set a scheme up yet.
43% of the small businesses polled also said that the added expense of contributing to their staff pensions would affect their ability to hire new staff in the future. Bidvine also asked participants if they thought there had been enough support and information about auto-enrolment, with two thirds answering no there had not been.
Many UK businesses are already signed up to the auto-enrolment scheme and are actively contributing to their staff pension pots, but more worryingly is the fact that many small business owners still do not know about the legislation and could face penalties when the deadline to sign up ends in February 2018.
Bidvine.com co-founder, Russ Morgan said,
“We wanted to get insight into what small businesses think about auto-enrolment seeing as it’s going to affect every employer in the UK. We were astonished to discover that many didn’t even know what it is!
“We were pleased to see that most business owners agree that auto-enrolment is a good idea, however it is slightly worrying that 43% said the extra cost will affect hiring new employees – something the government may have to consider in the future as it may affect employment.”