More than half (53%) of respondents offer a savings scheme to staff where deductions are made via payroll, according to research by the Chartered Institute of Payroll Professionals (CIPP).
Its Policy research paper – saving through payroll, which surveyed employers as well as representatives from the payroll industry, found that 41% of respondents do not offer such a scheme.
Of those organisations that do offer a savings scheme via payroll, more than two-thirds (70%) do so via a credit union.
Some 60% of respondents also offer a loan facility through their scheme, with some including mortgage lending.
The main reasons employers offer a savings scheme through payroll included:
- To help staff budget more effectively.
- To help employees with seasonal savings.
- To help employees avoid payday loans.
- To assist with employee wellbeing and to help staff save for the future.
Concerns about the administrative burden were high on the list of worries among those organisations that do not currently offer a scheme.
Lindsay Melvin (pictured), chief executive officer at the CIPP, said: “Auto-enrolment has shown that the government’s strategy of using inertia has so far been fairly successful.
“While the CIPP is not suggesting employers automatically enrol people into a savings scheme, the CIPP can help employers to try and encourage employees to save.
“Evidence suggests that when monies are taken from pay, employees tend not to miss it, whereas when they receive their net pay and have to save manually they find it more difficult.
“There is more the payroll industry can do to encourage saving through payroll.
“This is an opportunity for payroll departments across the UK to help their employer with their corporate social responsibility, recruitment and retention, absence rates and, of course, to offer facilities to their employees.”
