Workplace pensions for internal and temporary workers – what you need to know

Are you saving for retirement?

We all know that having something in the pot for retirement is important, but not all of us have our pension arrangements completely sorted out. This is especially the case for freelancers, one-person business owners and some temporary workers – namely, those who don’t contribute regularly to a workplace pension.

You might think you have lots of time before you need to start thinking about retirement, but it is never too early to start. The sooner your private or workplace pension is set up and being regularly added to, the less you need to worry about it.

Automatic enrolment

The good news is that the government is making a concerted effort to help people prepare for retirement, with the launch of its workplace pension automatic enrolment scheme. You may have seen this advertised on TV and in the media with the “Workplace Pensions – We’re All In” tagline.

The aim is to encourage all employers, starting with large companies and eventually working down to smaller businesses, to provide their employees with a workplace pension. Certain workers will be automatically enrolled by their employers, such as those who:

• Don’t already have a pension
• Are over 22 and under the State Pension age
• Work in the UK
• Earn over £10,000 a year

The great thing about the automatic enrolment scheme is that not only does the employer pay in when you pay in, but the government does too through tax relief. So, if you put in £30, your employer puts in £40 and the government adds £10 in tax relief, so your pension pot receives double the money.

The scheme is being rolled out gradually, so you might not be automatically enrolled until a couple of years’ time. The Government’s pensions website has a very handy tool to help people work out when they can expect to be automatically enrolled – why not give it a go?

How does this affect temporary and internal workers?

If you are a temporary worker or an internal employee, you might be concerned that you may not be eligible for automatic enrolment – but don’t worry! The Government has said that every employer has to enrol every eligible jobholder in the scheme, which includes some people in temporary positions or on non-permanent contracts.

If you are a temporary worker and your employment is handled by a recruitment firm, this is who will be managing your pension. Recruitment specialists like SOLOS Consultants work closely with pensions experts to ensure that everyone who is eligible for a workplace pension, and whose employer is obliged to join the scheme at this time, is enrolled when they should be.

If you have any concerns or questions about your pension, you can head to the Pensions Regulator website or speak to whoever manages your employment contract.