Ove Arup and Partners International has taken a number of steps to engage and encourage its employees to save for their retirement since closing its defined benefit (DB) pension scheme in 2010, and more recently in the run-up to auto-enrolment, which will begin to be introduced next month.
Pension roadshows, run in conjunction with BlackRock, the organisation’s pensions administrator, have offered employees advice and assistance to manage their retirement fund.
One of the main objectives of this campaign was to ensure that former DB scheme members who were transferring into Ove Arup’s replacement group personal pension (GPP) understood that the investment risk was being shifted from the organisation to themselves.
Evan Davidge, associate head of reward, programmes and data management at Ove Arup, which is part of global engineering business Arup Group, says: “The big challenge for the company with the GPP was getting people to realise that [investment] is something they need to self-manage. There was quite a hangover from the UK’s DB scheme [environment], where people were spoon-fed. Suddenly they realise that the risk is with them and not with the company and they need to take more active management of their individual pension funds.”
The organisation is now considering whether to introduce a wealth projection tool to help employees understand the impact of medium-and long-term savings and how to actively manage their accumulation of future wealth. It may also introduce financial advice clinics.
Ove Arup is also trying to ascertain the savings plans of employees who are not members of the pension scheme and the reasons why they have not yet joined the GPP in the run-up to the organisation’s auto-enrolment staging date in July 2013. A newly-established HR and pensions committee will co-ordinate the communication of issues such as auto-enrolment, which affect benefits.
The employer hopes that the alignment of the enrolment windows for its GPP and flexible benefits scheme will make employee communications easier to organise.
Currently, 92% of the organisation’s 3,250 employees are members of the GPP, which offers employer contributions ranging from 6% to 12%. Ove Arup will contribute 4% to the funds of employees who contribute 2% of pay and 12% for employees who contribute 6%, enabling employees to receive a maximum total contribution of 18%.
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