The compulsory “Workplace Pension” is already changing how employers and employees deal with pensions.
The law requires that all employers set up a pension scheme into which their employees and the employer have to contribute. It is a worthwhile effort to get people planning for their post-retirement financial security. This process is already in place for the largest employers in the UK and over the next three years, the process will gradually work its way down (based upon the number of employees) until it reaches those employers with only a very few staff.
This is something of a return to the past where employers had good pension schemes and employees had no real choice about joining. Those schemes generally provided a reasonable pension at retirement age. The Workplace Pension is nowhere as good but it is a step in the right direction. Note: The Workplace Pension changes do not apply to the self-employed or one-man limited companies.
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