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Pension reform is coming. The government is set to introduce compulsory workplace pensions from 2012 and vast numbers of employers, from the largest to the smallest, will be affected.
Initially, smaller businesses with fewer staff need not to worry, because the reform be carried out in stages.Only employers with over 30,000 staff will be forced by law to offer their workers a company pension scheme in 2012.
However, by 2013 any employer with more than 350 staff on its books will be obliged to set up and contribute into workplace plan for its employees.And between 2014 and 2016, those employers with less than 350 staff will be subject to the same rules.
Employees will be auto-enrolled and can expect their company to put a minimum 3% of any earnings between £5,035 and £3,540 into each worker's fund.
To help, the government is introducing NEST – National Employment Savings Trust – which will be provide a state-led alternative for any employer wishing to use it.
With the pensions crisis in full swing, experts believe reform has become urgently necessary. And companies have a key role to play if the funding condundrum is to be solved.According to Ian Bird, senior partner at Foster Denovo, the sooner Britain's companies start preparing for 2012's changes, the better.
There are 7 key steps for employers to consider as the reform deadline approaches.
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