Employers’ pension obligations – September 2012 update

Employer pension duties

September 2012 introduces new duties for employers regarding pensions. This summary (prepared by Active Solutions HR Consultants) gives you the basics so that you can consider what professional help you need.

UK Pensions Situation

As the UK population is living longer and the pension pot is becoming more stretched, the government is encouraging people to take more personal responsibility for saving. From September 2012 large employers are expected to automatically enrol certain employees into a pension scheme and make a contribution. Over the next few years all businesses will be required to comply with this change in law.

When the 2012 pension changes affect you

This depends on how many people you employed on 1st April 2012. Employers with fewer than 30 staff will be affected between September 2016 and April 2017; those with 62-89 staff 1st May 2014; and those with 62 to 89 staff will be affected on 1st July 2014. The Pensions Regulator will contact you between 6 and 12 months before the date your business will be affected.

What employer pension duties will be

You must:

  • Provide a qualifying pension scheme
  • automatically enrol all eligible employees
  • make a contribution
  • tell all eligible employees scheme details
  • register certain details of the scheme with the Pensions Regulator

You must NOT:

  • encourage staff to opt out
  • bias your recruitment so potential staff agree to opt out
  • treat workers unfairly or put them at a disadvantage because of automatic enrolment

Who this applies to (eligible workers)

Workers who:

  • Earn more than the minimum earnings threshold (currently £5,564)
  • Are aged between 22 and state pensions age and
  • Work in the UK

What contributions will be expected

Ultimately you will be expected to contribute at least 3% of their earnings and you can pay more if you wish. The worker will also be expected to contribute a total minimum contribution of 8%. Initially employer contributions will be 1%. The time scale for increases will be confirmed nearer the time.

If you already have a pension scheme

Your current pension scheme may already qualify. Find further details here

If your current scheme does not qualify then the advice of a financial adviser is recommended.

Useful links:

Active Solutions HR Consultants

The Pensions Advisory Service: www.pensionsadvisoryservice.org.uk

Financial Services Authority: www.moneymadeclear.fsa.gov.uk

Department for Work and Pensions: www.dwp.gov.uk/policy/pensions-reform

Dealing with failure

The word ‘failure’ can be very emotive, and in a business context can be quite debilitating. I was recently asked to do a short workshop of about 45 minutes on the subject of failure and thought that I would share it with you.

Aims of the ‘failure’ workshop

  • to explore what the word means to you
  • to discover your current strategy for failing
  • to leave with a modified strategy that may be more effective

The workshop runs in two sections – the ‘process’ part and the emotional / human part.

Take a minute and to yourself what the subject of failure triggers in your mind, and what failure means to you. Is it ever useful? Is it emotional? Is it alien as a concept? Our group came up with a board full of words, almost all related to emotion rather than pure fact or logic. The factual words we got were ‘outcome’ and ‘goals’.

Perhaps if we had to come up with an emotion-free definition of failure it may be:

‘something that results in an outcome that you did not want, and / or does not result in the outcome that you wanted.’

Setting good outcomes or goals

We discussed a number of formulae for setting good outcomes or goals and, without exploring each one in detail, wondered if we could emphasise two components and also add two more steps to most of the models.

It’s worth emphasising:

  • evidence – make sure that you know what success will look like to avoid a false perception of lack of success
  • control – be very aware of what you have control over before setting a definite goal. If there is something significant that you cannot control, it is unrealistic to expect success all of the time.

What we could add:

  • acceptable tolerances – they exist in engineering, so why do other business settings get encouraged to pin everything down to a specific value rather than an acceptable range?
  • potential side-effects or by-products. Often if an outcome is not achieved there is consolation in the form of lessons learned or other benefits. Why not consider there in advance so that their existence is seen more as  as benefit than spin for something going wrong?

The overall recommendation is to avoid being so specific in your original aims that success or failure balances on a knife edge. This reduces underlying stress and the burst of disappointment, which dissipates as the events fit into perspective.

Reflecting on how we would approach something which could go wrong, we noticed what a more flexible and realistic approach to setting goals could be like.

This ended the ‘process’ part of the workshop.

Emotional reaction to failure

We started the part of the workshop that deals with individual reactions by considering how we would coach a colleague or client through a setback or failure. With that in mind, we contrasted it with the way that we reflect on our own setbacks, and in general found that we offered others more understanding and tolerance than ourselves – even though we were not being insincere or condescending to them.

One of the most common emotions expressed was fear about what might happen, and we will probably follow-up with a workshop on this, because fear of the new or unknown can definitely rectrict business growth and personal development.

For now, the lesson was to treat ourselves at least as well as we do our colleagues to get a more useful reaction to setbacks.

The new strategy

Having gained an appreciation of some practical elements of our processes and some more helpful insights into our own reactions it was time to consider an amended way of approaching important tasks. The steps we considered follow – you can of course expand and fill in stages that you personally find useful:

  • set appropriate goals that you have control over and which make it clear what will have been achieved
    • add acceptable tolerances to some of the figures
    • add a ‘bail-out’ condition, i.e. if things are not working, when is it wise and acceptable to stop
    • be aware of any useful side-effects (including learning and improving) that add to the overall value of the experience
  • monitor your progress
  • review both planned and unplanned benefits and setbacks
  • reconsider your tolerances in the light of your experience – you can probably tighten them a little for next time

Summary

The concept of failure is such a personal that I can’t give a definitive guide in a manageable blog post or even a group workshop. However, here are some of the key points that people found useful:

  • with practise you can replace the word ‘failure’ with more useful ones or focus only on the learning points. This can be useful as long as you appreciate that for many people failure is a real word that triggers real emotions which need to be considered. The well-worn phrase ‘there is no failure, only feedback’ is valid only if it is sincere and acknowledges personal disappointment or frustrations
  • there is a scale between ‘success’ and ‘failure’, with many useful outcomes in between
  • setting useful goals is vital – both to know when you have achieved something and to be aware of what lies along the scale towards total success. Goals can include tolerances, acceptable lessons and the odd surprise
  • the concept of tolerance is not a cop-out. Sometimes second and third place are OK when they lead to first
  • business involves people and people have emotions. It takes skill and practice to work with both emotion and logic, and it is key to recognise which one is influencing the decision process at any one time

So, enjoy tweaking the way that you go about things in order to recognise how far towards the success line your actions are. Failure will still exist, but it may be a place that you are aware of rather than frightened of, and one which you rarely visit.

Opening of Camping Pods at Two Hoots campsite

Today I had one of the occasions which anyone in the coaching world loves – an invitation to the opening of a new business, them launching a new product or a new product or service.

This time the invite came form Caz and Dave, who run the Two Hoots campsite near Alresford in Hampshire. They were opening their new camping pods, washing block and kitchen area.

Having had the vision when they acquired the campsite, they have been working on the plans for well over a year. I helped them with their business planning and finances, which benefited hugely from the support of a LEADER grant from the Fieldfare area. All credit to the Fieldfare team, especially Ken Brown and Eloise Appleby for their support in making this happen.

What now? Well, with bookings ahead of the budget and superb facilities, Caz and Dave will be working on the presence of Two Hoots campsite in a many places as possible, and of course making sure that their visitors get the best experience from their stay. I wish them the very best in building on their success so far.


Find the site at www.twohootscampsite.co.uk.