Auto enrolment - 5 steps to bureau success
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Auto Enrolment - 5 Steps to Bureau Success by Paul Byrne with guest speaker Henry Cobbe from Trust Pensions. For more information visit www.brightpay.co.uk
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Auto enrolment - 5 steps to bureau success
- 1. The webinar will begin shortly... Auto Enrolment - Five Steps to Bureau Success How to choose a quality scheme and not get lost trying to navigate the auto-enrolment jungle By Paul Byrne By Henry Cobbe
- 2. By Paul Byrne Auto Enrolment - Five Steps to Bureau Success
- 3. By Henry Cobbe How to choose a quality scheme and not get lost trying to navigate the auto enrolment jungle.
- 4. Q&A Session Questions Tab or #BPWebinars Competition Two BrightPay 2015/16 bureau licences On Demand This session is being recorded REC Q&A WIN
- 5. Auto Enrolment - Five Steps to Bureau Success
- 6. • Accountancy Practice for 20 Years • Payroll software development • Expanded into the UK – BrightPay & Bright Contracts • 80,000 employers across the UK & Ireland use our products Paul Byrne
- 7. • UK Payroll Landscape • Small Employers & Auto Enrolment • Lack of understanding surrounding Auto Enrolment • Auto Enrolment Penalties • Profit from Auto Enrolment • Are you Open for Business? Agenda
- 9. Entitled Workers Non Eligible Jobholders Eligible Jobholders Auto Enrolment Overview
- 10. Eligible Jobholders • Aged between 22 and State Pension age • Earn more that £10,000 per year • Work, or ordinarily work, in the UK Auto Enrolment Overview
- 11. 1. Set up a pension scheme 2. Assess employees 3. Communications 4. Ongoing duties 5. Declaration of Compliance Auto Enrolment Responsibilities
- 12. Small Employers and Auto Enrolment
- 13. Small Employers and Auto Enrolment 60,861 employers completed declaration of compliance 1.8 million yet to reach their staging date
- 15. Lack of Understanding Surrounding AE
- 16. Lack of Understanding • Large and medium employers: HR personnel to help with auto enrolment • Small and micro employers: lack of in-house expertise • Majority of employers yet to stage will not have the knowledge or experience to make informed AE decisions
- 17. Lack of Understanding • Information overload - confused, bewildered and overwhelmed • Expected that 78% of these will turn to an accountant, bookkeeper, or payroll bureau for advice and counsel • Gift wrapped business opportunity
- 19. Auto Enrolment Penalties • Further non compliance may result in court action. • Responsibility for AE compliance rests with the employer. • If employers don’t comply, enforcement action starts with statutory notices and is followed by penalty notices
- 20. Auto Enrolment Penalties 3,782 Total automatic enrolment cases closed to date 2,248 Compliance Notices Issued 582 Fixed Penalty Notices Issued
- 21. Are you open for business?
- 22. • Are you ready or prepared to take on auto enrolment business? • What level of support / information will you offer? • Are you prepared for employers coming to you last minute? Auto Enrolment – A Chargeable Service
- 23. • Payroll bureaus must predict the evolutionary need of their clients • Establish yourself as a proactive rather than a reactive AE advisor • Necessary level of service for an initial set up fee plus a monthly retainer Auto Enrolment – A Chargeable Service
- 24. • By offering a complete end to end solution, bureaus can generate income and enhance client relationships. • If you offer other services, auto enrolment will provide a new platform to reach and upsell to. • Employers will be happier to consolidate all their outsourced services to one person or advisor. Auto Enrolment – A Chargeable Service
- 25. Value Proposition for your Clients 1. Time saving 2. Cost saving 3. Focus on core areas 4. Expertise
- 26. Profit from Auto Enrolment
- 27. Opportunity for Profit • Considerable opportunity – Gain new business – Retain client base – Increase profits • Perfect platform to acquire new clients while building a long term, sustainable business.
- 28. 1. Engage your clients 2. Avoid Penalties 3. Open for Business 4. Increase Revenue 5. Software Solutions 5 Steps to Bureau Success
- 29. 1. Engage your clients 2. Avoid Penalties 3. Open for Business 4. Increase Revenue 5. Software Solutions 5 Steps to Bureau Success
- 30. • Engage with clients who have not yet staged • Find out clients’ staging date – http://bit.ly/1EuooiJ • Be proactive – let clients know that you are open for AE business • Communicate AE service offering & pricing • Risk of losing some or all of your payroll clients 1. Engage with your Clients
- 31. 1. Engage your clients 2. Avoid Penalties 3. Open for Business 4. Increase Revenue 5. Software Solutions 5 Steps to Bureau Success
- 32. • The Pensions Regulator continues to enforce fines and penalties for non- compliance • Not allowing enough time to plan could lead to your clients being fined 2. Avoid Penalties
- 33. 1. Engage your clients 2. Avoid Penalties 3. Open for Business 4. Increase Revenue 5. Software Solutions 5 Steps to Bureau Success
- 34. • Bureaus can position themselves as available for AE business • Clients outsource to you because you have the know-how and it saves them time and money. • Trusting you as a payroll professional to make sure they are fully AE compliant with the law. 3. Open for Business
- 35. 1. Engage your clients 2. Avoid Penalties 3. Open for Business 4. Increase Revenue 5. Software Solutions 5 Steps to Bureau Success
- 36. • A number of advantages to offering AE as a Service. • By offering AE as a chargeable service, bureaus can: – Enhance client relationships – Add additional revenue streams – Provide added value to your existing clients – Bring new clients on board – Benefit from a competitive edge 4. Increase Revenue
- 37. 1. Engage your clients 2. Avoid Penalties 3. Open for Business 4. Increase Revenue 5. Software Solutions 5 Steps to Bureau Success
- 38. 5. Software Solutions • Ensure the software supports the requirements of AE and will correctly perform tasks • Without appropriate systems in place, additional time and resources will be required • Payroll software can automate employer admin tasks, e.g. Assessing employees • The Pensions Regulator urges bureaus and employers to check with their payroll provider
- 39. • Modern innovative solutions exist that can automate AE duties • BrightPay – integrated payroll and auto enrolment solution • Designed to take all the grunt work out of auto enrolment • Allow you to streamline auto enrolment, saving time and money Streamline Auto Enrolment
- 42. Key Take Aways
- 43. 1. Engage your clients 2. Avoid Penalties 3. Open for Business 4. Increase Revenue 5. Software Solutions 5 Steps to Bureau Success
- 44. 1. Engage your clients 2. Avoid Penalties 3. Open for Business 4. Increase Revenue 5. Software Solutions 5 Steps to Bureau Success
- 45. 1. Engage your clients 2. Avoid Penalties 3. Open for Business 4. Increase Revenue 5. Software Solutions 5 Steps to Bureau Success
- 46. 1. Engage your clients 2. Avoid Penalties 3. Open for Business 4. Increase Revenue 5. Software Solutions 5 Steps to Bureau Success
- 47. 1. Engage your clients 2. Avoid Penalties 3. Open for Business 4. Increase Revenue 5. Software Solutions 5 Steps to Bureau Success
- 48. 1. Engage your Clients 2. Avoid Penalties 3. Open for Business 4. Increase Revenue 5. Software Solutions 5 Steps to Bureau Success
- 49. By Henry Cobbe How to choose a quality scheme and not get lost trying to navigate the auto enrolment jungle.
- 51. Tuesday 24th November @ 10.00 am https://www.brightpay.co.uk/events/1038/ CPD Accredited: Auto Enrolment Training for Payroll Bureaus By Paul Byrne & Victoria Clarke
- 52. * Offer applies to new customers who switch to BrightPay from another payroll software provider for the first year subscription only. This offer applies to BrightPay 2015/16 bureau licence only and does not work in conjunction with any other offer.
- 53. 99.3% Customer satisfaction rate 99.5% Describe interface as user friendly 98.8% Would recommend BrightPay 98.5% Satisfied with Customer Support
- 55. Accredited by ICB - Read here “The BrightPay user interface is superb and makes data capture painless.” “The language used is easy to understand and minimises the use of payroll jargon.“
Hinweis der Redaktion
- Hi everyone and thank you for joining us today. Just a small bit about myself to start off…
- My background is as a practising accountant. I started my own practice back in the 80s and eventually grew it to a 3 partner practice with 10 staff. While in practice, I provided payroll bureau services for a good number of clients so I have some idea what it is like in the front line. In 1992, I got into payroll software development - A large part of my reasoning for this was to make better software than what I was using at the time. Eventually, I began working in software development full time, allowing us to focus on a wider range of software packages and in particular our UK payroll software. Today, 80,000 employers across the UK and Ireland use our products, a figure that we are improving on every year.
- So, here is the agenda for my slot today which I hope you will find useful and give you plenty of food for thought. When talking I will often refer to Auto Enrolment or Automatic Enrolment simply as AE. For those of you who have tuned in to any of our previous webinars, apologies if I end up repeating some of the points previously made. Unfortunately, this is unavoidable.
- You can’t argue that the UK's payroll landscape has changed forever. The introduction of auto enrolment has brought and is bringing employers kicking and screaming into participating in a workplace pension scheme.
- What auto enrolment actually means for an employer is that, from their staging date (or from their deferred date if they are using postponement), all eligible jobholders must be automatically enrolled and the employer must make contributions to their pension. All employees must be assessed to determine whether they are eligible jobholders, non eligible employers or entitled workers.
- Eligible Jobholders Eligible jobholders are those who: are aged between 22 and State pension age, earn above the earnings threshold (currently £10,000) and work in the UK. All other employees are either non eligible jobholders or entitled workers and they can choose to join the workplace pension scheme. Eligible jobholders can opt out after being enrolled. In summary, auto enrolment is something that is optional for the employee but mandatory for the employer.
- With auto enrolment comes a number of employer responsibilities: A pension scheme must be set up with a qualifying pension provider and this should be done in advance of your staging date. This should not require a great deal of time to complete. If you have no eligible jobholders, you can hold off registering with a pension scheme until you need to enrol someone. This is the latest TPR guidance. Next, the workforce must be assessed at your clients staging date and all eligible jobholders must be automatically enrolled into a workplace pension scheme, unless they are using postponement. All employees must receive communications within 6 weeks of the staging date, not just those who hove been enrolled. You must notify eligible jobholders, non eligible jobholders, and entitled workers including those who have been postponed of AE and how they have been affected. Apparently, some employers believe that if they choose to postpone all employees for 3 months at their staging date, then nothing needs to be done in that 3 month period. This is not the case as all employees must receive a communication within 6 weeks of the staging date relating to the postponement and explaining when they will be enrolled. If this communication is not issued then the postponement effectively never happened and enrolment must be completed retrospectively back to the staging date which will in itself be a nightmare. There are also a number of ongoing employer responsibilities such as handling opt outs (and opt ins), making deductions and contributions, monitoring employees each pay period, and sending a contribution file to the pension provider. Employers, or you on their behalf, must complete a Declaration of Compliance within 5 months of the staging date to notify the Pensions Regulator that they have complied with AE.
- Auto enrolment is being rolled out in stages across all employers, and started with the larger employers in October 2012. By October 2018 all employers will be required to offer workplace pension schemes to eligible workers. By the end of September this year, over 60,000 large and medium sized employers had completed their declaration of compliance, enrolling 5.4 million eligible jobholders into a workplace pensions scheme. The Pensions Regulator estimates that, over the next three years, around 1.8 million small and micro employers will need to act as a result of auto enrolment.
- You will see from the slide that January 2016 is when the bulk of small and micro employers start to stage. This is the start of the so called tsunami and things will definitely get very interesting from there on.
- A lot of the companies staging before now will probably have had their own HR people or in house accountant to help them through the enrolment process. The vast majority of those staging from January 2016 will have no in-house expertise. The majority of these employers will not have the knowledge or experience to make informed decisions when it comes to their AE obligations.
- With the vast quantity of information available, employers are fast becoming confused, bewildered and overwhelmed. The Pension’s Regulator estimates that 78% of SMEs will turn to an accountant, bookkeeper, or payroll bureau. So, you have a gift wrapped business opportunity! And this is business you don’t have to go chasing. These clients will require help understanding the implications for them, their employees and their business.
- The responsibility for complying with the employer duties rests with the employer. If employers don’t comply, they will face enforcement action in line with the Pensions Regulator’s risk-based approach. TPR will investigate breaches of the law in a fair and objective manner. Enforcement action starts with statutory notices and is followed by penalty notices. Further non compliance may result in court action. The risk based approach uses information from 3 sources: No declaration of compliance Reports from pension providers about none or late payments Whistleblowing by employees
- There has been a total of 3,782 AE cases closed to date. This includes 2248 Compliance notices and 582 Fixed penalty notices. A full breakdown can be seen on the pensions regulator’s website. You can be rest assured that these numbers will explode once the small employers enter the fray.
- Payroll bureaus need to decide if they are ready to take on AE business. With many shying away from offering this as an extra service, bureaus will need to determine what kind of information and support they will offer to help their clients comply with these new AE duties. Advisors will find that a large portion of employers will contact them very close to or even after their staging date. If a client does contact you after their staging date and has done nothing, if their staging date has passed by less than 6 weeks, get them to issue postponement letters to all employees immediately. Otherwise they will need to backdate AE back to the staging date.
- Payroll bureaus that want to succeed in this competitive industry will need to predict the evolutionary needs of their clients. Clients will have an expectation that their payroll adviser will present AE advice in a way that is easy to understand, relevant and actionable. You need to establish yourself as a proactive rather that a reactive AE advisor. Bureaus will naturally increase their income by providing this service in exchange for an initial set up fee plus a monthly retainer to manage the on-going AE duties or an increased price per payslip. One bureau client mentioned to me that for a 15 employee client, they had charged £400 for handling staging and upped the price per payslip by 50% to cover ongoing monitoring and assessment. Apparently, the client was delighted. I have often heard accountants say that they can’t really charge for AE because their clients wouldn’t accept it. Just remember, it’s not your fault that AE is coming in and if you are to take on the responsibility for AE for them then it is perfectly acceptable that you charge for it.
- By offering a complete end to end solution, bureaus can generate income and enhance client relationships. If bureaus offer other services such as bookkeeping, tax returns, audits, management accounts, etc. they will have a new platform to reach and upsell to this new audience. You will find that employers will be happier to consolidate all their outsourcing services to one person or advisor.
- There are a number of benefits for your clients who outsource to you for auto enrolment: Time There will be significant time savings for your payroll clients. By outsourcing AE to a payroll professional, your client can avoid investing huge amounts of time researching how to comply with AE. The implementation of AE could also be very time consuming if your client doesn’t have the correct technology or software in place to automate a lot of the AE admin tasks. Cost Time is money as the saying goes. Without your help your payroll clients might choose payroll software that doesn’t have AE functionality. Even if it does some payroll providers are charging an additional charge for AE functionality and a further charge to support your clients through the process. With a bureau your client can avoid costly mistakes and save time that otherwise would have been taken out of their normal working week. Focus on Core Areas Especially for small and micro employers their time is extremely precious. Time away from their business is money. Outsourcing AE to a payroll professional frees up their energies and enables them to focus on the core areas of running their business. Expertise Implementing AE may require skills that staff do not possess. Outsourcing will provide a level of continuity to the company while reducing the risk of possible non compliance.
- As employers begin to tackle the complexities of AE, many will lack the know-how, experience and resources required to deal with their obligations properly. There’s little doubt, employers are going to need professional help complying and familiarising themselves with their new responsibilities and legal requirements. That’s where their accountant, bookkeeper or payroll bureau can step in.
- Auto Enrolment is offering a considerable opportunity to gain new business, retain clients and increase profits. For those strategic bureaus who will offer AE services they will certainly have the perfect platform to acquire new clients while simultaneously building a long term, sustainable business.
- If you have payroll clients, there are five important steps which will allow you to improve profits: engage with your clients, avoid penalties, be open for auto enrolment business, increase revenue and have suitable software in place.
- Step one – engage with your clients
- Engage with your Clients Advisors will find that a large proportion of their clients will contact them very close to or even after their staging date. It is important to engage with small and micro employers that have not yet staged to help reduce the number of latecomers. The first thing to do is to find out your clients’ staging date in order to start planning accordingly. It is possible to look up your clients staging date on The Pensions Regulator's website, if you have their PAYE employer number. You need to be proactive and notify these clients that you are open for AE business. Communicate your service offering and price it with your clients so that they know who will be responsible for each task. It would be a good idea to send you clients an overview of what auto enrolment will look like at the time of staging. In a few minutes we will show you a free pre-assessment tool that shows you each employees work category and gives the client general information about the assessment process. Be aware, that if you decide not to process AE, there will be a risk that you will lose some or all of your payroll clients.
- Step 2 – avoid penalties
- Avoid Penalties The impact of AE will affect your clients business now and for the foreseeable future. The Pensions Regulator continues to enforce fines and penalties for non-compliance. Not allowing enough time to plan could lead to your clients being fined. AE penalties range from £50 to £10,000 depending on how many employees your client has. By planning ahead, it will allow you, on behalf of your clients, to avoid hefty penalty fines.
- Step 3 – be open for auto enrolment business
- Expertise You do not need to have an in depth knowledge of AE. However, by understanding employer AE obligations, a bureau can position themselves as an authority figure who is open for AE business. Employers outsource their payroll processes to you because you have the know-how and it saves them time and money. Today, with AE, it is not only about cutting costs for employers but trusting you as a payroll professional to make sure they are fully AE compliant. Furthermore, some employers may not have the competency, time or know-how to handle AE themselves.
- Step 4 – increase revenue
- Increase Revenue AE is presenting bureaus with a unique platform to increase profits. There are a huge number of small and micro employers due to stage between now and 2018. It will be important to capitalise on this window of opportunity. By offering AE as a chargeable service, bureaus can add additional revenue streams, provide added value to existing clients and increase the possibility of bringing new clients on board. It further provides a competitive edge to you over other bureaus that refuse to provide AE as a service to their clients.
- Step 5 – have suitable software solutions in place
- Payroll software will play a vital role in ensuring the success of AE. Ensure the software supports the requirements of Auto Enrolment. Without the appropriate systems, bureaus will need additional time and resources to cope with AE. You will need to know which employees need to be automatically enrolled and which employees have the option to opt in. Payroll software can access employee pay and other information so as to establish who will be eligible, non eligible or entitled. The Regulator further urges bureaus and employers to check with their payroll provider to ensure that it will correctly identify the duty you have for each employee and to see if the system will support the requirements of AE.
- Fortunately, modern innovative solutions exist that can automate AE chores. Armed with the employer staging date, bureaus can now simply enter the date to assess each employee’s eligibility for AE at the staging date. Good payroll software will further handle all employee AE communications based on each employee’s individual eligibility. For example, BrightPay is an integrated payroll and AE software solution that is designed to take all of the grunt work out of AE. It will allows you to streamline your clients auto enrolment duties, saving you both time and money
- With BrightPay you can benefit from unlimited employers, unlimited employees, auto enrolment functionality, and free phone and email support, all for just £199 plus vat per tax year. You can also benefit from a 60 day free trial which has no limitations to the software.
- I would now like to hand you over to Vicky for a quick demo showing you just how easy auto enrolment can be with BrightPay. In this example we are assuming that the employer (or you on their behalf) has already registered with a pension provider, in this case NEST. Thank You Vicky.
- Thank you Vicky So to summarise..
- The five important steps to bureau success include engaging with your clients, avoiding penalties, being open for auto enrolment business, increasing revenue and having suitable software in place.
- The five important steps to bureau success include engaging with your clients, avoiding penalties, being open for auto enrolment business, increasing revenue and having suitable software in place.
- The five important steps to bureau success include engaging with your clients, avoiding penalties, being open for auto enrolment business, increasing revenue and having suitable software in place.
- The five important steps to bureau success include engaging with your clients, avoiding penalties, being open for auto enrolment business, increasing revenue and having suitable software in place.
- The five important steps to bureau success include engaging with your clients, avoiding penalties, being open for auto enrolment business, increasing revenue and having suitable software in place.
- The five important steps to bureau success include engaging with your clients, avoiding penalties, being open for auto enrolment business, increasing revenue and having suitable software in place.
- As Rachel mentioned earlier, due to unforeseen circumstances Henry is unable to join us today so I will now pass you back to Rachel.
- Here are a few interesting statistics from a recent customer survey.
- Here are a few interesting statistics from a recent customer survey.