Beauty company nails AE with just one opt-out from 175

Speaking at the National Association of Pension Funds' annual conference in Liverpool today, Purdey Wildey, financial controller for Nails Inc, said the company became aware of auto-enrolment 18 months before its staging date and budgeted as it saw fit.  

In the first couple of months there were a lot of calls just asking what these deductions were in their salaries

Purdey Wildey, Nails Inc

However, it did little more to prepare until three months before its staging date, Wildey said. This led to challenges when approaching providers and advisers.

"We were told they would prefer people who had more time rather than less time," said Wildey.

The company, which enrolled 175 staff 10 months ago, received several enquiries from concerned employees.

“In the first couple of months there were a lot of calls just asking what these deductions were in their salaries,” she said. “But once it was all explained to them they were very happy.”

However, due to the seasonal nature of much of the company’s workforce, Wildey expressed concern that a number of employees may find themselves being auto-enrolled after the Christmas period only to opt out in January, placing a strain on scheme administration.

The company is hoping to minimise opt-out rates by matching the pension provision on offer to the needs of the membership.

"I wanted to make sure it was as beneficial to our employees as possible," said Wildey. "And I think the key to that is knowing the staff and knowing the business so you know what they would find a benefit and what they’d want to opt in to. Or, if they automatically opted into something, what would keep them there.”

Dedicated provider contact

Wildey credited part of the company’s success to having a dedicated contact at its provider.

“We’ve been enrolled 10 months and have had the same manager,” she said.

Despite this, other employers found having a single provider created communication problems.

David Coveney, director at web development company Interconnect IT, said: “The key contact we had at the provider left, so we were emailing and not hearing anything back.”

He added: “A centralised system would allow providers to improve their communication and smooth the process.”

The disparate nature of Nails Inc’s workforce presented a communication challenge, Wildey said.

“Something I could have done sooner was adopt electronic payslips, which meant I would have had all of their email addresses so that the communications could then go out,” she said. “I did have, at the beginning, maybe 30 or 40 communications that came back to me, that I then had to try and post out or email out to them.”

While both Nails Inc and Interconnect IT had no pension scheme prior to their auto-enrolment preparations, Valerie Allen, commercial director for General Welding Supplies, said its two existing pension schemes complicated its auto-enrolment experience.

“The advisers told us that neither of our schemes supported auto-enrolment, so I contacted the schemes to ask them if they could be adapted to support it. Basically they told me it’s up to me to find out whether they do support it or not… I’m seeking more advice on whether we can continue with these schemes. I hope we can because I don’t want to have three pension schemes at one time,” said Allen.