EXCLUSIVE: 16% of employees reduced pension contribution levels due to Covid-19

16% of employees reduced pension contribution levels during Covid-19

One-sixth (16%) of employees reduced their pension contribution levels, while 7% stopped their contributions altogether as a result of the Covid-19 (Coronavirus) pandemic, according to research by Employee Benefits.

The Employee Benefits Pensions research 2020, which surveyed 94 pension strategy decision-makers, also found that a further 15% chose to come out of their workplace pension scheme. However, nearly a quarter (22%) sought access to financial advice in order to gain a better understanding of their pension during this time, and 6% increased their contributions.

The pandemic has also affected employees’ retirement plans: 4% have delayed their retirement date due to the impact that Covid-19 has had on the value of their pot, but conversely 4% have taken early retirement. Some employees (3%) had to access cash from their pension pot early.

Many employers (47%) took no action with regards to their pension scheme in response to Covid-19, however, others introduced support for employees in the way of education and advice. A quarter (26%) introduced additional pensions communications and 11% introduced pensions education sessions for all staff. A further 11% introduced support for those employees nearing retirement. Some respondents (4%) funded access to financial advice for all employees, and 4% funded it for those specifically near their retirement date.

How Covid-19 has impacted employees’ behaviour around pensions

Sign up to our newsletters

Receive news and guidance on a range of HR issues direct to your inbox

OptOut
This field is for validation purposes and should be left unchanged.

The action respondents’ organisations have taken around pensions in light of the Covid-19 pandemic

Click to download the Employee Benefits Pensions research 2020.