Salary > Pension contribution. Is a 2-3 week delay normal?

Dazed_and_C0nfused

Cobbler_tone said:

Not a question, more an observation. I have 'challenged' my employer as the timing of contribution vs when they deduct it from me is all over the place and getting worse.
I get paid on the 11th and normally see it land on the 18th-21st of the month with L&G.
One went in the 18th Feb, the next on 4th April (due to a split payment of salary and bonus on the 11th and 30th) and this months went in this morning after 11th April contribution.
Either the employer or L&G are not doing what they were doing as quickly as they were. Judging by the delay after the salary/bonus I suspect it is the employer.
I just don't the idea of my money sitting in no mans land for 2-3 weeks. Someone is benefitting! 

Are you sure the money added on the 18-21st isn't from the previous month's deduction?

Cobbler_tone

Dazed_and_C0nfused said:

Cobbler_tone said:

Not a question, more an observation. I have 'challenged' my employer as the timing of contribution vs when they deduct it from me is all over the place and getting worse.
I get paid on the 11th and normally see it land on the 18th-21st of the month with L&G.
One went in the 18th Feb, the next on 4th April (due to a split payment of salary and bonus on the 11th and 30th) and this months went in this morning after 11th April contribution.
Either the employer or L&G are not doing what they were doing as quickly as they were. Judging by the delay after the salary/bonus I suspect it is the employer.
I just don't the idea of my money sitting in no mans land for 2-3 weeks. Someone is benefitting! 

Are you sure the money added on the 18-21st isn't from the previous month's deduction?

It is 100% the most recent pay run…i.e. the 11th gets paid in the 18th, albeit now taking longer. I can see that as I’ve changed my contribution rate several times.
Judging by your question you will say that is really quick. The fact remains that something has changed to delay it.

Silvertabby

scaashiana said:

Hi

My salary is paid to me on the last working day of each month.  My pension contribution is made through my salary at the same time.

My DC (I edited this to DC from DB previously, my error, it is DC) pension is with L&G and checking there, my pension contributions are normally received around the middle of the following month (i.e. 2-3 weeks after salary).  This delay seems excessive to me, given that payment transfers today are normally fairly instant.  There could be good reason for this and, before I start prodding and poking people at work, I thought I'd ask here.  Is this normal?  Where is that money during those 2-3 weeks?

I work for a large multi-national company. If you multiply my pension contribution by the c4000 people employed, that's a lot of money in a 'black hole' somewhere for several months every year (rough maths I know, not everyone contributes the same as I, but you get what I mean).

Your company is unlikely to send 4000 individual pension contributions on the last working day of the month. 

Much more likely that they will send a single payment for the total amount, with a list of all the individual amounts by name and NI number.  This list will take a while to collate and check then, on receipt by L&G, they will have to allocate the right amount to the right name.  

Cobbler_tone

Silvertabby said:

scaashiana said:

Hi

My salary is paid to me on the last working day of each month.  My pension contribution is made through my salary at the same time.

My DC (I edited this to DC from DB previously, my error, it is DC) pension is with L&G and checking there, my pension contributions are normally received around the middle of the following month (i.e. 2-3 weeks after salary).  This delay seems excessive to me, given that payment transfers today are normally fairly instant.  There could be good reason for this and, before I start prodding and poking people at work, I thought I'd ask here.  Is this normal?  Where is that money during those 2-3 weeks?

I work for a large multi-national company. If you multiply my pension contribution by the c4000 people employed, that's a lot of money in a 'black hole' somewhere for several months every year (rough maths I know, not everyone contributes the same as I, but you get what I mean).

Your company is unlikely to send 4000 individual pension contributions on the last working day of the month. 

Much more likely that they will send a single payment for the total amount, with a list of all the individual amounts by name and NI number.  This list will take a while to collate and check then, on receipt by L&G, they will have to allocate the right amount to the right name.  

I'd hope that in 2025 this is from an integrated upload and not someone manually checking and punching numbers into a spreadsheet!

Silvertabby

Cobbler_tone said:

Silvertabby said:

scaashiana said:

Hi

My salary is paid to me on the last working day of each month.  My pension contribution is made through my salary at the same time.

My DC (I edited this to DC from DB previously, my error, it is DC) pension is with L&G and checking there, my pension contributions are normally received around the middle of the following month (i.e. 2-3 weeks after salary).  This delay seems excessive to me, given that payment transfers today are normally fairly instant.  There could be good reason for this and, before I start prodding and poking people at work, I thought I'd ask here.  Is this normal?  Where is that money during those 2-3 weeks?

I work for a large multi-national company. If you multiply my pension contribution by the c4000 people employed, that's a lot of money in a 'black hole' somewhere for several months every year (rough maths I know, not everyone contributes the same as I, but you get what I mean).

Your company is unlikely to send 4000 individual pension contributions on the last working day of the month. 

Much more likely that they will send a single payment for the total amount, with a list of all the individual amounts by name and NI number.  This list will take a while to collate and check then, on receipt by L&G, they will have to allocate the right amount to the right name.  

I'd hope that in 2025 this is from an integrated upload and not someone manually checking and punching numbers into a spreadsheet!

Integrated upload yes, but there must be some form of checking procedure, even if only a random selection out of the 4000 and a final 'reasonability' check of the total amount.  With that amount of money, a hiccupped extra zero or wandering decimal point could be......interesting.

JoeCrystal

Well, in my case, AEGON still haven't got around to crediting the pension contributions from October 2024 payslips that the employer collected and sent!. AEGON haven't bothered getting back to me regarding that and my employer got an email saying that they having trouble crediting contributions into pension plans since then!!! So it could be much worse!

We are pretty much six or seven months behind! Our employer was not only one affected by this issue apparently. Funny enough, I just did some googling and there was a response from Aegon that they "having some issues allocating these to the plans in the scheme." Which matches that my employer told me few weeks ago.

Hoenir

Cobbler_tone said:

Silvertabby said:

scaashiana said:

Hi

My salary is paid to me on the last working day of each month.  My pension contribution is made through my salary at the same time.

My DC (I edited this to DC from DB previously, my error, it is DC) pension is with L&G and checking there, my pension contributions are normally received around the middle of the following month (i.e. 2-3 weeks after salary).  This delay seems excessive to me, given that payment transfers today are normally fairly instant.  There could be good reason for this and, before I start prodding and poking people at work, I thought I'd ask here.  Is this normal?  Where is that money during those 2-3 weeks?

I work for a large multi-national company. If you multiply my pension contribution by the c4000 people employed, that's a lot of money in a 'black hole' somewhere for several months every year (rough maths I know, not everyone contributes the same as I, but you get what I mean).

Your company is unlikely to send 4000 individual pension contributions on the last working day of the month. 

Much more likely that they will send a single payment for the total amount, with a list of all the individual amounts by name and NI number.  This list will take a while to collate and check then, on receipt by L&G, they will have to allocate the right amount to the right name.  

I'd hope that in 2025 this is from an integrated upload and not someone manually checking and punching numbers into a spreadsheet!

There'll be a reconciliation performed to account for starters, leavers and changes in contributions. This will be double checked.  Passed through to the finance team that will have their internal payment proccesses to follow. The BACS payment will take 3 days alone. Might take a few days for the month's return to be processed at the receiving end. 

Far too simplistic to assume that your deduction is simply paid over just like tht. Organisations will have defined segregation of duties assigned to roles.  There'll be numerous checks and balances. To block any collusion between connected partes and stop fraud. 

Should add that payroll departments have all manner of deductions to deal with. Here's food for thought. Why your payroll department are always busy. 

1. Tax Deductions

2. National Insurance Contributions

3. Pension Contributions

4. Student Loan Repayments

5. Union Membership Fees

6. Voluntary Deductions

7. Deductions for employee benefits

8. Deductions for absences

9. Court-Ordered Deductions - attachment to earnings, child maintenance etc

10. Deductions to correct overpaid wages

11. Deductions for Company Loans

12. Deductions for Cycle to Work Schemes

13. Deductions for Car Leasing Schemes

14. Deductions for company share schemes

Farside71

Silvertabby sai

Integrated upload yes, but there must be some form of checking procedure, even if only a random selection out of the 4000 and a final 'reasonability' check of the total amount.  With that amount of money, a hiccupped extra zero or wandering decimal point could be......interesting.

Every month there is a significant amount of issues from matching contributions to members, dealing with all the non standard activity such as joiners and leavers and just general issues in the data such as name changes or other oddities so you are absolutely correct that automated data transfers only go so far.  Money typically goes into a suspense account and needs to be matched back out again. Having seen this all go wrong from the systems side of things I totally understand why all providers seem to take roughly the same amount of time to apply the contributions 

2nd_time_buyer

JoeCrystal said:

Well, in my case, AEGON still haven't got around to crediting the pension contributions from October 2024 payslips that the employer collected and sent!. AEGON haven't bothered getting back to me regarding that and my employer got an email saying that they having trouble crediting contributions into pension plans since then!!! So it could be much worse!

We are pretty much six or seven months behind! Our employer was not only one affected by this issue apparently. Funny enough, I just did some googling and there was a response from Aegon that they "having some issues allocating these to the plans in the scheme." Which matches that my employer told me few weeks ago.

@JoeCrystal did you make any headway with this? I notice my wife's pension with Aegon had not been credited for over a month. Presumably your money has not been invested since October. Which might not be a bad thing with the market. It sounds pretty outrageous to me.  Has it been escalated to the FCA?

penners324

Penguin_ said:

It does take a bit of work to prepare, check & submit monthly contributions for some employers. They have to upload new starters, wait for them to be verified etc & then upload the monthly contributions. 

Only some. Most payroll systems link directly to pension schemes to do this automatically.