Employer pension contributions delay

Acasia571

I get paid on 28th of each month.
10% gets deducted for my pension contribution
However - this does not get added to my pension until 17th of the following month
So it looks like for years someone, either my employer, or the pension provider has been holding on to my pension money for an extra 3 weeks - during which time it is not accruing interest in the pension pot.
This smells like another one of the many financial tricks these organisations have of taking small amounts from many people - which individually isn't noticeable, but for the organisation probably adds up to a significant sum.
It's an anachronism in these days of digital financial transfers taking seconds, not weeks. The days of banks hanging on to your money while it 'clears' are long gone.   

How can I find about any regulations concerning this?

TheMilkmansDad

Google?

After you’re paid, your employer must usually pass your contribution to your pension scheme by the 22nd of the following month, or 19th if they pay by cheque. 

MEM62

From the .GOV website

When you’re enrolled into their pension scheme, your employer must:

• pay at least the minimum contributions to the pension scheme on time - usually by 22nd of each month

So it looks like they are meeting their obligations.  Bear in mind also that there will be some delay between the pension administrator receiving funds from your employer and crediting your pension.     

dunstonh

I get paid on 28th of each month.
10% gets deducted for my pension contribution
However - this does not get added to my pension until 17th of the following month

That is within the allowed timescale.

So it looks like for years someone, either my employer, or the pension provider has been holding on to my pension money for an extra 3 weeks - during which time it is not accruing interest in the pension pot.

The pension provider applies it within 24 hours of receiving it.   Your employer is the one delaying it.

This smells like another one of the many financial tricks these organisations have of taking small amounts from many people - which individually isn't noticeable, but for the organisation probably adds up to a significant sum.

You would need to make your views known to your employer.

It's an anachronism in these days of digital financial transfers taking seconds, not weeks. The days of banks hanging on to your money while it 'clears' are long gone.   

Actually, they are not.  BACs is still frequently used at a commercial level.   

In the case of auto enrolment though, it is nearly always direct debit with the payroll team selecting a date for collection and the pension provider getting it 3 days later and clearing 7 days from collection.  Most pension providers would apply it on the third day.    Some may pre-fund it (using their own money - the complete opposite of what you claim).

How can I find about any regulations concerning this?

Google, AI engines, and the legislation itself.

However, as said, it is within the allowed timescale.

Cobbler_tone

We asked the same question, although ours only takes 10-12 days. It needs to be manually checked by payroll for errors before being sent to the pension company. We can also change our contributions every month which may complicate the checks.
You can then see it has arrived, as for 24 hours or so the providers portal says that a transaction is being processed.

vacheron

I've never had an employer who hasn't milked this 19th / 22nd rule for all it is worth. 
I have also had employers who used to frequently overstep the limits by a few days. 

A quick e-mail to the finance director reminding them that they are commiting a criminal offence and mention of the pensions regulator usually seemed to snap them back into line pretty quick! 

Exodi

Acasia571 said:

holding on to my pension money for an extra 3 weeks - during which time it is not accruing interest in the pension pot.

Sorry, this is somewhat of a pet peeve of mine.

To be clear, the money would not be accruing interest in your pension pot (well I mean technically it's possible if they were paying into a SIPP and your instructions were to not automatically invest the money, but for most people the money is automatically invested in their chosen fund when deposited).

You could argue that you have lost out on potential investment returns by having the money out of the market for 3 weeks, but expect a counter-argument that you have also avoided potential investment losses also during market downturns.

Regardless, it's not an unreasonably long delay. FWIW, when I was with HL, their DD only took money on the 7th with the trades made on the 10th - despite the money being available to take from the employer whenever.

Acasia571 said:

This smells like another one of the many financial tricks these organisations have of taking small amounts from many people - which individually isn't noticeable, but for the organisation probably adds up to a significant sum.

A tinfoil hat theory I'm afraid.

Marcon

Acasia571 said:

I get paid on 28th of each month.
10% gets deducted for my pension contribution
However - this does not get added to my pension until 17th of the following month
So it looks like for years someone, either my employer, or the pension provider has been holding on to my pension money for an extra 3 weeks - during which time it is not accruing interest in the pension pot.
This smells like another one of the many financial tricks these organisations have of taking small amounts from many people - which individually isn't noticeable, but for the organisation probably adds up to a significant sum.
It's an anachronism in these days of digital financial transfers taking seconds, not weeks. The days of banks hanging on to your money while it 'clears' are long gone.   

How can I find about any regulations concerning this?

A quick Google would have got you straight to details of the relevant regulations, avoiding the need for a lengthy post based wholly on nothing more sinister than your lack of understanding. You are far from alone, but hopefully you are now better informed and reassured that there is nothing untoward going on.

penners324

Cobbler_tone said:

We asked the same question, although ours only takes 10-12 days. It needs to be manually checked by payroll for errors before being sent to the pension company. We can also change our contributions every month which may complicate the checks.
You can then see it has arrived, as for 24 hours or so the providers portal says that a transaction is being processed.

It'll be checked before they complete payroll. 

penners324

Most payroll systems automatically send pension data across to the pension company.

Assuming it's set up correctly.

LHW99

And as you are investing the pension for retirement, 3 weeks is neither here nor there in the scheme of things, as it's going to remain invested for years (hopefully).