Work Pension - General Advice

hugonellie

I've been apart of my works scheme now for approx 12-13 years - I pay min 3% and they match this. Back in November 2017 (I got a pay rise) I discovered that my pension deduction from my payslip didn't increase. I then checked all the previous years and previous pay rises and it had been the same figure for some time. I queried this with my Director (we have a small company, there's less than 10 of us, she's my immediate boss) and she said she'd speak to our accountants (they sort out wages / payslips etc out). The accountants say they thought it was a fixed figure and not a percentage and no one from my work had told them the amount should of changed. My contract definitely says %age - my Director has only been here 4/5 years so has inherited this problem. Since Nov 2017 the deduction figure has been correct.

Basically, I've been underpaying and they've been underpaying for some time, but no one wants to take responsibility on a) who was to blame and b) who should calculate the error so it's put right. They've admitted it that it is 'wrong' but I'm not getting anywhere fast with this....is there anything I can do to move things along without annoying my Director? My worry is that my funds have improved in this time, should I be asking for that money paid into my pension also?

I'm aware I will have to make up 'my' side of the shortfall and I am happy to do this. I've always paid above my standard 3% so I imagine this will cause issues when trying to work out whatwe both SHOULD of been paying into it. I don't think its a vast amount of money....I imagine other members of staff have also suffered the same issue. I kinda just want it sorted out as its been going on 10 months now

xylophone

Try TPAS for assistance.
https://www.pensionsadvisoryservice.org.uk/

hugonellie

Thank you! I've spoken to them and they basically said I need to be put back into the position I would of been had this mistake of not happened. I might have to pay my shortfall and my employer pay their's, plus any growth on the fund over the years.

He said to speak to ACAS to see if there was a way to get them to hurry this along. Not sure I want to push that hard with what I think will amount to about £1k. I would just rather it be sorted out now, so the money is in my fund, gaining any growth - and so we can all draw a line under it.

Can I go to my boss and maybe suggest they stick £1k (with some explanation of how I worked that out) into my Standard Life Fund and sign a piece of paper so that's the end of it? I know my director doesn't want the hassle of this, but not sure if that's legal or fair?

ex-pat_scot

hugonellie wrote: »

Can I go to my boss and maybe suggest they stick £1k (with some explanation of how I worked that out) into my Standard Life Fund and sign a piece of paper so that's the end of it? I know my director doesn't want the hassle of this, but not sure if that's legal or fair?

If they didnt give you a payrise for years, whilst telling you that they had done, would you still be pondering whether it was legal or fair - then what would you do?


The company contributions into your pension are part of your salary (the deferred compensation element). Your view should be the same whether it is salary or pension that has been underpaid.


As a separate conversation, you might want to take a look at how much overall is going into your pension. If you are contributing 3%, that's not terribly much.

atush

I agree, you need to pay in more.

Try and tell the director in a letter how you came to the 1K figure. In the meantime, pay in the amount that you should have done over time.

Lastly, your company NEEDS a new accountant. Perhaps your director can claim from his professional liability insurance to cover the mistake?

Brynsam

atush wrote: »

Lastly, your company NEEDS a new accountant.

Not if the accountants were given duff instructions about the amount which should have been contributed...

hugonellie

Thanks for the replies so far....I have always paid over and above my 3% into this Standard Life Pension - I think I now pay 9% after upping it again on my last pay rise. On top of this I also now pay into my Nest pension, as do they with the min contributions. I'm currently trying to pay my mortgage off with any other spare cash I have floating around - I realise this might not be the best in terms of rates / savings however I want to get rid of that debt as a priority - whilst also trying to save for my future.

The accountants say the Standard Life payment was always done on a fixed amount as they don't do %ages (the Standard Life platform that is, you can only input a fixed amount) - so as my director has inherited this job from the previous lady who done it - this piece of information has been left out / lost and they are arguing between themselves over who's fault it is. I don't think either of them want the responsibility for fixing it in case there's recourse from all members of staff or further issues. The accountants we use now had a pension arm attached to their company - they set this up originally and gave us advice when setting the pension up at the start of our service - I remember them asking things like my attitude to risk, so they could set up my account properly. This arm of their branch has now dissolved and they simply do our finance for us now, invoicing / tax / payroll etc.

After this is all fixed, I want to seek further advice on where my funds are invested, I have no idea if they are in the correct place for my needs. I have changed my Nest funds over to NEST Sharia Fund as this seems to be a better performing fund than the basic one they were in - there's only £1k in there at present as any other funds go to over payment of my mortgage. There's 42k in My Standard Life fund and they are in a Lifestyle Profile: 3BALANCED UNIVERSAL. Does that help any further?

dunstonh

The accountants say the Standard Life payment was always done on a fixed amount as they don't do %ages (the Standard Life platform that is, you can only input a fixed amount)

That is correct for the Standard Life platforms (Std Life Elevate and Std Life wrap). However, neither of these are auto-enrolment compliant. As this is an auto-enrolment scheme then its likely it is not the platform products but the insurance company group personal pension. That can do percentages as salary is input.

Thank you! I've spoken to them and they basically said I need to be put back into the position I would of been had this mistake of not happened. I might have to pay my shortfall and my employer pay their's, plus any growth on the fund over the years.

That is the normal expectation. You only get the employer bit if you do your bit.

squirrelpie

As this is an auto-enrolment scheme

I think you missed that there are two pensions - an old one with Standard Life and a new auto-enrolment one with Nest.

squirrelpie

@hugonellie it sounds like a good idea to me for you to work out how much extra you think both you and your employer should have put into the Standard Life scheme over the years, and how much growth those contributions would have made, based on the growth of the existing funds. If you feel comfortable doing that, then do it so you have a good idea of what needs to happen.


From what you've said, it seems likely that you will already have paid in your portion, since you've been 'overpaying' so it will just be a contribution from them that is needed. Again, if you feel comfortable then I think presenting that number to your director and asking them to pay it in and have done with it is a good idea. Quite what process they will want to follow and what paperwork they may want to file away will probably depend on what their lawyers tell them, unless they trust you or TPAS/ACAS to tell them what they have to do.

atush

Brynsam wrote: »

Not if the accountants were given duff instructions about the amount which should have been contributed...

Any decent acct would know about autoenrollment pensions, and the fact that they are a % of salary.