At some point, most businesses will have at least a few international and/or transient employees.
Our latest insight looks at the unique needs these employees have, and what workplace pension providers are doing to make sure their systems can identify and support them.
A wide variety of businesses are reliant on transient and international employees. Agricultural businesses often bring large numbers of workers from overseas during the harvest period. Catering and leisure businesses often rely heavily on transient workers to cover busy periods. Construction contractors will often predominantly use contractors for most of their on-site skilled and unskilled work.
However, a transient workforce may also be present within many businesses who may not be geared up to support their needs. There may be agency workers employed for cleaning and security services. There may be zero-hours or casual workers working less desired shifts that are likely to soon move on. It is also important not to forget that non-executive directors, present in all PLCs, are deemed to be transient workers.
Even in companies where there is little to no transient workforce, there may be employees for whom English is not their first language and/or are working from overseas.
So what are workplace pension providers doing to help employers ensure these workers are catered for when it comes to their pensions?
Our data shows that three-quarters of workplace pension provider systems can identify and support a transient workforce. The providers that cannot are Legal & General, Legal & General Master Trust, Mercer Master Trust Scottish Widows, Scottish Widows GSIPP, and Scottish Widows Master Trust.
Chart 1: Which of the following transient workers can your system identify and support?
A transient workforce is defined by high employee turnover. Our data shows that 63% of workplace pension providers have no restrictions in place in relation to accepting a scheme based on the staff turnover of the employer firm.
Chart 2: Restrictions to accepting a scheme based on the staff turnover
Fidelity, Fidelity Master Trust, Mercer Master trust Scottish Widows, Scottish Widows, Scottish Widows GSIPP and Scottish Widows Master Trust will not accept a firm with high staff turnover, but will accept a scheme with a medium staff turnover ie 11-39% per year.
Hargreaves Lansdown will only accept a scheme with a low staff turnover, i.e. less than 10% staff turnover per year.
With transient workers often working variable hours, our data shows that workplace pension provider systems can all monitor employee earnings and enrol them once they meet the automatic enrolment contribution threshold. All do this automatically and also automatically produce the appropriate communications to alert the employer and employee of this.
Language barriers can also provide challenges for transient workers.
With the nature of business becoming increasingly international, it is also increasingly common for even smaller employers to have workers that are either temporarily or permanently based overseas.
However, our data shows that few workplace pension providers have the full ability to cope with overseas elements of employer firms. Only Fidelity, Fidelity Master Trust, Standard Life and Standard Life DC Master Trust have systems that are able to cope with accessibility through different dates and timelines, offer international security, and can cope with language and currency differences.
Legal & General, Royal London, Scottish Widows and True Potential do not currently support different languages and currencies.
Chart 3: Operating in multiple languages and currencies
Overall, whilst most workplace pension providers can offer some form of support for a transient workforce, there is still much work to be done especially when it comes to workers based overseas.
It is worth noting that the systems from Legal & General, Legal & General Master Trust, Mercer Master Trust Scottish Widows, Scottish Widows GSIPP, and Scottish Widows Master Trust are not able to identify and support a transient workforce.
It is also worth noting that Hargreaves Lansdown will only accept a scheme with a low staff turnover, i.e. less than 10% staff turnover per year.
Therefore, these providers may not be as suitable for employers who work in sectors where a significant proportion of their workforce is made up with agency, temporary, zero-hours, and contract workers.