Star Payroll Auto Enrolment Client Survey
Star Payroll provides payroll software to hundreds of Payroll Service Providers. We recently asked them how successful their Auto Enrolment services have been as the demand has grown over the past couple of years. We had 118 responses giving an insight into the delivery of Auto Enrolment for Pensions. Such a fascinating insight, we wanted to publish the findings.
These results are a reflection on the high quality of service delivery which we believe is echoed across the payroll industry and a new dynamic for payroll. Payroll teams have met the challenge and upskilled, often with minimal resource to take on the increased workload. Payroll bureau and accountancy practices have embraced AE as a new revenue generating service, helping to promote payroll front and centre as a key business critical facility.
How do these results compare with your own payroll team?
1.What sort of service is being provided to clients? A massive 96% are assessing employee eligibility and 98% are producing reports or feeds for the pension providers. Plus 80% are also creating worker notices – that’s still much higher than we imagined.
2.How are workers notices distributed? The vast majority consider worker notices the employers’ responsibility for distribution with 83% passing the letters directly to the employer. There are just 25% who post them straight to employees. This possibly reflects additional time and cost for the volume of letters being handled as too much for an already strained payroll department.
3. How many clients do you provide AE services to? Star customers are on an average providing an Auto Enrolment service to 80 clients each, with many commenting they could see a sharp increase coming in 2017. On average, they are providing payroll services to 225 clients, so staged companies are a significant proportion already.
4. How are pension feeds sent to the provider? A very healthy 26% upload directly to the pension providers as their only service and 68% use a combination of uploads and emailing feeds to the clients.
5. How are Opt-out notices received? Almost the same level of responses for both client notified and direct from the pension provider at around 75% each. An enlightened 10% download as a dynamic interface. This number will surely grow as workloads continue to increase. Only a limited number of pension providers offer the facility too.
6. Which are the most often used pension companies? Well no surprises that NEST comes out top of the list, closely followed by The Peoples Pension. The remainder of the replies were spread evenly across L&G, Smart, Aviva, Scottish Widows, Creative and AEGON and others.
In conclusion, what we can see here is the dramatic impact of the new reality of Payroll Services provision post-Auto Enrolment. Workplace pensions has had a far-reaching impact on employers in terms of costs and compliance. The responsibility for delivery though has landed squarely with Payroll professionals who have to advance or get left behind. In terms of client retention, Auto Enrolment fits the outsourcing model perfectly improving the stickiness of services and elevating the value of payroll to businesses in the UK.