Auto-enrolment – working out who does what.

The hard part in establishing a process to stage auto enrolment and manage it each payroll period is not working out what needs to be done. Process maps exist that will help you understand the scope and complexity of the task.

It’s the decision “who does what” that is likely to cause most friction and if it these decisions are not taken and properly communicated, there are likely to be gaps through which people and their contributions will fall.

One thing is clear, though the rules handed down to us by Government are the same for all and the process maps pretty similar too, there will be little consistency in application.

This is because of the variety of business solutions employed by large , medium and small companies. It is possible to think of infinite permutations between in-house and outsourced payroll, HR and pension functions not just between companies but between business units within companies.

To expect a one size fits all solution is naive and is likely to only breed complacency.

Part of the problem is that only a handful of people can properly understand the whole picture. Pension, payroll and HR systems people tend to work in operational silos and while generalists may be able to look at the big picture, operationally there needs to be a significant bashing of heads together. It’s not clear that enough of this is going on.

If sensible solutions cannot be found by the existing service providers,it is likely that we will see new providers taking on the job, organisations that can provide an outsourced integrated solutions. Companies will look at these solutions (often described as middleware) with suspicion since they not only introduce a new level of cost, but a new level of risk. Data cannot flow through middlemen without cost and risk.

While pension people go about cleaning up the pension schemes companies have organised for themselves and payroll people wait to be told what they are supposed to be up to, the problem of implementing staging  and managing ongoing payments does not get sorted.

Those who manage the payroll processing need to have a clear ide of what they are expected to be doing and this brief needs to be established by an organisations operational director. Larger companies that have HR departments and even pension departments may have the capacity to work all this out for themselves (though they’d probably do best to check with their advisers as they go along). Small companies and larger companies where the bulk of the HR and payroll servicing is outsourced need to be talking with their external partners and not expecting a magic bullet to take this problem away.

It is likely that the source for solutions in this area rests with those who manage payroll. They hold the data. Those who write the code that powers the payroll software, those who train the payroll managers in how to use the software and those who process payrolls all need to get auto-enrolment. Auto-enrolment at the operational end is not easy but it is not impossible,

What may be the hardest thing for companies to do, is to establish who does what as this question seems to be least discussed, considered and answered.

If you would like to discuss the structure and capabilities  of your back office service teams and what they will need to do to manage these processes, I suggest you start looking for someone to help you. That may be a challenge in itself! If you get stuck henry.tapper@firstactuarial.co.uk may help.

About henry tapper

Founder of the Pension PlayPen, Director of First Actuarial, partner of Stella, father of Olly . I am the Pension Plowman
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3 Responses to Auto-enrolment – working out who does what.

  1. Pingback: Why First Actuarial focuses on Payroll | Henrytapper's Blog

  2. When you say ‘who does what’ will probably create the friction, you mean internally in the company? I am sure your knowledge on the topic will be valuable at an upcoming webinar on Auto-enrolment.
    Full webinar details: bit.ly/Premier_Pensions_Agenda
    Registration link: bit.ly/Premier_Pensions_Registration

    Thanks,
    Angelos

  3. Pingback: Payroll folk and Pensions should be friends | Henrytapper's Blog

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