The Association of Convenience Stores (ACS) has responded to the Work and Pensions Select Committee into the pension auto enrolment process, stating that it is concerned over the cost of pension auto enrolment for its members.
The association is the voice of 33,500 local shops in the UK, lobbying the government on issues that affect these small and often family-run businesses. Since launching in 2012, required start dates for auto enrolment have been staggered based on the number of employees; implementation for smaller businesses such as convenience stores will begin in June 2015.
Under auto enrolment law, businesses are required to pay the equivalent of 1% of each employee's annual salary into their pension, rising to 3% by 2018.
However, it is not only this direct cost that is of concern to the ACS. It believes smaller businesses, lacking the in-house payroll and HR expertise of large companies, will struggle to cope with managing the scheme and dealing with compliance. The Pensions Regulator recently issued fines of £400 to three small businesses that had failed to meet their duties in this respect, emphasising the potential added costs of implementation.
ACS Chief Executive James Lowman commented:
"Auto enrolment has the potential to be a significant operational and financial burden on small retailers, and we are keen to work with the Department of Work and Pensions to minimise the costs of implementation whilst ensuring that all retailers are aware of what is required of them."
Help with auto enrolment implementation
Many businesses have enlisted an interim payroll consultant or pensions administrator to assist them in auto enrolment implementation. With extensive background knowledge of pensions legislation, and often with experience of implementing schemes, they can ensure the transition is smooth and fully compliant. However, by only being employed on a temporary basis, costs can be kept to a minimum.
For advice on hiring a temporary payroll specialist, call our recruitment team on 020 7247 9455.