New Work Pension

hugonellie

As part of my employment contract I was allowed to sign up to our works private scheme, which entitled me to put in 3% and work matched that after one years service. I have been doing that successfully for around 11 years now - its with Standard Life and I get a statement for it every year.

With the new government pension scheme coming into play my work have only JUST realised that this is going to cost them more money. They are suggesting that I get rid of my old pension and merge it with this new one (she even suggested my old one was worthless and I had stupidly been paying into it when I was going to get nothing back out of it) and I simply pay the new 0.8% as the company cannot afford any more. She started mentioning figures that it would cost them 8k more a year and they couldn't afford it. I am unsure where she's got this figure from as there is only 8 of us here and other than the directors I am paid the most at 30k a year - which I believe means I pay around £16 and they pay slightly less. I'd be slightly concerned if they can't afford sub £200 in my case for this - I know they are doing well, our profits are up.

We have an accountancy firm that deals with this for us and I queried the pension pots being merged and he's told me that they will be separate - so I signed up immediately. I've mentioned this to my director who wasn't very happy and said the accounts ARE going to be merged and that she is going to speak to the accountancy firm.

Is she allowed to do this? Surely she can't just change my contract without me agreeing to it first?

Rachel_Pierson

hugonellie wrote: »

As part of my employment contract I was allowed to sign up to our works private scheme, which entitled me to put in 3% and work matched that after one years service. I have been doing that successfully for around 11 years now - its with Standard Life and I get a statement for it every year.

With the new government pension scheme coming into play my work have only JUST realised that this is going to cost them more money. They are suggesting that I get rid of my old pension and merge it with this new one (she even suggested my old one was worthless and I had stupidly been paying into it when I was going to get nothing back out of it) and I simply pay the new 0.8% as the company cannot afford any more. She started mentioning figures that it would cost them 8k more a year and they couldn't afford it. I am unsure where she's got this figure from as there is only 8 of us here and other than the directors I am paid the most at 30k a year - which I believe means I pay around £16 and they pay slightly less. I'd be slightly concerned if they can't afford sub £200 in my case for this - I know they are doing well, our profits are up.

We have an accountancy firm that deals with this for us and I queried the pension pots being merged and he's told me that they will be separate - so I signed up immediately. I've mentioned this to my director who wasn't very happy and said the accounts ARE going to be merged and that she is going to speak to the accountancy firm.

Is she allowed to do this? Surely she can't just change my contract without me agreeing to it first?

Once you have people being auto-enrolled into workplace pensions they didn't ask for in the first place, it's inevitable that more liberties will be taken. Try getting your company's accountancy firm to put in writing the advice they gave you that the pots will not be merged. But it's doubtful they will, because they're working in the company's interests and not yours at the end of the day.

xylophone

Is your firm closing the existing pension arrangement and opening a new auto-enrolment plan?

https://www.gov.uk/workplace-pensions/what-you-your-employer-and-the-government-pay

Employer contributions will have to rise over the next couple of years see above.

hugonellie

Rachel_Pierson wrote: »

Once you have people being auto-enrolled into workplace pensions they didn't ask for in the first place, it's inevitable that more liberties will be taken. Try getting your company's accountancy firm to put in writing the advice they gave you that the pots will not be merged. But it's doubtful they will, because they're working in the company's interests and not yours at the end of the day.

I have it in writing from the accountancy firm that I will have two pots. It's my immediate manager - soon to become director - who disagrees with our accountancy firm.

xylophone wrote: »

Is your firm closing the existing pension arrangement and opening a new auto-enrolment plan?

https://www.gov.uk/workplace-pensions/what-you-your-employer-and-the-government-pay

Employer contributions will have to rise over the next couple of years see above.

Not as far as I am aware - there's been no mentioning of it in the correspondence I have received from anyone. Ideally I would like to keep both pots open - but I'm worried they are going to remove my 3% one and replace with this new one.

Can they do that without my agreement? Is it possible to run two concurrently? She's saying its not - but our accountants are saying it is. Is it worth ringing Standard life to ask if its possible or if they can shed any further light?

edited to add: I've just read that link - thanks for that! looks like they can do whatever they want providing they meet the min requirements

hyubh

hugonellie wrote: »

With the new government pension scheme coming into play my work have only JUST realised that this is going to cost them more money.

Out of interest, in terms of admin/setup costs, or having to enrol more staff, sooner? If they are already paying 3% into your pension, that's already above the current AE minimum:

http://www.thepensionsregulator.gov.uk/en/employers/duties-checker/outcomes/i-am-an-employer-who-has-to-provide-a-pension/choose-a-pension-scheme-or-check-your-existing-one/understanding-your-costs/making-contributions-to-your-pension-scheme

she even suggested my old one was worthless and I had stupidly been paying into it when I was going to get nothing back out of it

Sounds a rather silly thing to say. Taken seriously, it suggests the company completely messed up in picking a rather rouge pension provider before. In reality I'd imagine the Standard Life plan is pretty standard with standard defaults however.

I simply pay the new 0.8% as the company cannot afford any more.

Why does she think the rate you pay as the employee affects the company? 0.8% after basic rate tax is just the minimum employee contribution required under AE.

I'd be slightly concerned if they can't afford sub £200 in my case for this - I know they are doing well, our profits are up.

Quite, sounds a fair bit of huffing and puffing over not much, notwithstanding the fact AE is a bit of a hassle.

hugonellie

I'm starting to think she's just ranting about it to anyone who will listen, so I've started speaking directly to Standard Life and the accountancy firm. I'm just not going to speak to my work about it anymore, mainly in the hope she'll forget about it and they'll pay both my pots like the accountants have said - fingers and toes crossed!

Thanks everyone, I think I was just slightly miffed at her rants so had my own on here