Over 90% of small employers those with 249 or fewer workers want to delay their in auto-enrolment duties until ongoing pension reforms are completed, an Association of Consulting Actuaries poll has found.
In a survey of 414 smaller firms, the ACA found that 62% of employers with ten or more employees are now clear about when they must auto-enrol eligible employees into a defined contribution pension scheme. However, among employers with very small workforces - nine people or fewer - less than half (46%) had identified their staging date.
ACA chair David Fairs said he was not surprised at the number of smaller firms that wanted to setback their staging date, due to the many pension reforms being squeezed into a short time-frame.
Currently, three-quarters of firms with four or fewer employees offer no pension scheme, but would be required to auto-enrol their employees into a defined contribution pension scheme over the period 2014 to 2017, with a minimum of 1% from the employer plus 1% from the employee, noted the firms ACA 2014 smaller firms' pension survey.
And by October 2018 these contributions must be the equivalent of 8% of employee 'band earnings', with a minimum of 3% from the employer plus 4% from the employee.
Fairs said this added a lot of pressure on smaller firms 'at a time when average pay increases are likely to be well below these figures'.
'In a three year period from the middle of this year, over one million small employers will have to meet the auto-enrolment challenge,' he said.
'Yes, it is right that pension provision should be available to employees in even the smallest firms, but with so many pension reforms being squeezed into a short time-frame, it cannot be surprising that smaller employers are calling for a delay in auto-enrolment.
'We believe that there could be some sense in pausing the dates when employers with fewer than 50 employees are due to auto-enrol - namely those due to auto-enrol from June 1 2015 onwards.'
He said this would give all of the political parties the opportunity in the run-up to the General Election to outline what financial measurers they are proposing so the scheduled higher minimum pension contributions from October 2018 do not undermine take-up or, employment levels.
Elsewhere the survey found that almost two-thirds (60%) of smaller firms are supportive of the budget reforms, with just one in ten opposed.
Also, 'face-to-face' meetings are seen as the most popular channel for the ‘guidance guarantee’ by employers, followed by web-based tools and then telephone guidance.
And over half (56%) of employers said they supported further changes that targeted current levels of pension tax on those with lower incomes, with a third saying that reliefs should be further restricted for those on higher incomes.