Salary sacrifice for pensions ignored by many employers

Many UK employers either don’t consider using salary sacrifice in pension plans or ignore it, claims actuarial consultancy Punter Southall, following a survey of more than 300 UK organisations ranging from charities to manufacturers.

It found that 29% of respondents had rejected the idea of offering salary sacrifice deals in pension plans, 28% had never considered it, and 43% had used the option.

The poll also found that 82% felt that the benefits they offered “were appreciated by at least some of the workforce”, but only 10% had canvassed the opinions of their staff about the benefits they offer.

Finally, only 38% of respondents said they thought Personal Accounts pensions will be a “positive change”, though 50% felt they will have a positive impact on retirement savings. About 7% of those polled had not heard of Personal Accounts, including some companies with more than 500 employees.

Meanwhile, logistics company Schenker cut its benefits spend and raised staff participation in its pension fund after third-party provider Jelf Group helped promote it.

Jelf helped Schenker roll three defined contributions pension schemes into one Group Personal Pension Plan and, after a communications programme, raised staff participation from 150 a year ago to about 300.

Schenker also said it saved about £48,000 annually on its life assurance and private health cover benefits after Jelf re-brokered deals.

HR director Andre Roux said: “Cost reduction is a vital part of my work but it is equally important for the company to ensure benefits recognise the importance and value of employees to our business.”

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