I understand that all UK legal employers will soon have a legal obligation to enrol employees into a pension scheme. How can I prepare?

Historically, pension scheme take-up in the retail sector has been low and for many employees the reforms will bring about their first experience of workplace pension saving. Chris Crighton, a pensions specialist at law firm TLT, says retailers need to assess the impact auto-enrolment will have on their business. By 2017, employers and employees will have to make contributions of 3% and 4% respectively of an employee’s gross qualifying earnings. To prepare for these changes, retailers are given their own ‘staging date’, between October 2012 and 2016, when their obligations to enroll employees on a qualifying pension scheme will commence. It is essential that retailers find out when their staging date is and to put the necessary measures in place.

“This includes telling employees that they have been enrolled onto a scheme as well as giving them the right to opt-out. They must register details of the qualifying scheme with the Pensions Regulator,” says Crighton. “If retailers already have a pension scheme they should check whether it meets the requirements for a qualifying scheme and if not, consider whether to use the Government’s newly created workplace pension scheme.”

Crighton says retailers cannot induce workers to opt-out of pension scheme or make job offers conditional on opting out but may be able to take steps to reduce the impact of auto-enrolment. “Retailers may want to consider offering certain workers fixed-term contracts of periods no longer than three months. Given the potential for employee unfair dismissal or discrimination claims arising from auto-enrolment, employers should seek specialist legal advice to ensure compliance.”