Auto-enrolment has significantly increased workplace pension participation, yet many employees still face the risk of insufficient income in retirement.
To improve outcomes for pension savers, the government has strengthened oversight by making pension schemes conduct value-for-money assessments and is encouraging the adoption of collective defined contribution schemes.
In summer 2025, the Pensions Commission was reinstated to evaluate whether current pension arrangements provide adequate support and an independent review of the state pension age was launched, with potential increases under consideration to ease financial pressures.
But despite these positive steps, employees may need to raise their own contributions especially in the 54% of large organisations constrained by salary sacrifice limits that restrict further tax-efficient saving, according to a recent employee benefits survey conducted In November 2025 on behalf of the Chartered Institute of Personnel and Development (CIPD) and Everywhen. Taken together with rising life expectancy and increasing concerns about the affordability of retirement, many workers will have to save more and remain in employment for longer to achieve financial security.
So, what steps can employers take to prepare their employees for working longer? I suggest reward and HR professionals review the following areas. First, employee health and wellbeing. By focusing on employee physical and mental health, employers will be able to help their employees not only remain in the workplace for longer but also ensure they remain productive.
Second, how jobs and tasks are designed. By ensuring that work is designed to support healthy ageing not only can this help employees remain in their jobs for longer, it will also ensure that they are productive.
Third, reward: explore if what’s rewarded, how, and why supports the needs of both the business and an ageing workforce. This includes: how pay or bonus decisions are made; staff benefits that support health and wellbeing; and flexible working opportunities.
And financial awareness: spell out to employees what decisions they must take if they would like to retire early, such as contributing a little extra and taking a little more investment risk when they are young.
By reviewing these areas now, employers can ensure their workforce is equipped to work longer and retire with greater financial resilience.
Charles Cotton is senior reward adviser at the Chartered Institute of Personnel and Development (CIPD)
