The Chartered Institute of Payroll Professionals
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• there is a consistent pattern of practical supports provided by employers, alongside paid leave, suggesting that their budget is being shared between other offerings – such as coaching, care, phased returns – and the leave itself The report also explores what’s coming in the future and what employers should do next. Read the full report, here.
Benchmarking can help enhance an organisations approach on policies and procedures and make a positive impact on the workforce. Keep a look out for the CIPP’s Benchmarking Report 2023, due to be published later this year.
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Nest Insight: opt-out payroll savings Published: 28 September 2023 Emailed: 4 October 2023
Nest Insight has released the report ‘ Opt- out autosave at work’ . Since November 2021, Nest Insight has been working with large UK employers on real-world trials of opt-out approaches to payroll-linked saving. It has been found that in all three live trials, taking an opt-out approach is dramatically boosting saving participation. The report has been published which supports the case for widespread use of opt-out payroll savings approaches in UK workplaces to help boost financial resilience. In an opt-out payroll autosave model, employees automatically start saving into their own accessible savings account through regular payroll contributions unless they choose not to. If they want to start saving, they don’t need to do anything - everything i s done for them. Only people who don’t want to save have to take action. An opt-out payroll autosave approach preserves individual choice while also making it easier for people to get started with short-term saving. It has been reported that a significant proportion of UK workers have little or no money put aside for emergencies. One quarter of adults in the UK have less than £100 in savings leaving them vulnerable to financial shocks. Some households are left with no choice but to turn to high-cost credit or loans. In November 2021, Nest Insight began trialling opt-out approaches to payroll-linked saving. It was found that in all three trials, the opt-out approach is dramatically boosting saving participation and workers say they like the scheme (>93%), whether or not they themselves choose to save. Nest Insight believe the nudge is both powerful and popular, suggesting that wider adoption of opt-out payroll autosave would help millions more to build a savings buffer.
Nest Insight has been trialling two ways that opt-out payroll saving can be set up by workplaces:
• new worker trial - since November 2021, Nest Insight have been working with UK employer SUEZ recycling and recovery UK on a trial where for all new employees the employer has set up payroll autosave into a savings account with the credit union TransaveUK • benefits app user trials - since October 2022, Nest Insight have been collaborating with the financial wellbeing app Wagestream, where two of Wagestream’s employer clients: Bupa Care Services and the Co -operative Group, have had payroll autosave offered to their employees through the Wagestream app. Emma Stockdale, Research Trials Manager at Nest Insight, said: “The results of these trials are extraordinary. Savings participation is dramatically increased by using opt -out approaches, bringing it much more in line with the proportion of employees who say they want and need to save – somewhere between 40% and 70%, depending on the workplace context and provider. People are building meaningful savings buffers over time, and they’re actively using their accounts by withdrawing money when they need it. Knowing that they’re saving also gives people greater peace of mind and confidence, supporting financial wellbeing to improve over time. The current data from these trials give us no reason to believe other areas of people’s finances, including pension saving through auto enrolment, are negatively impacted. The results are really positive. People want to save, and many can save, it sometime s just takes a bit of help to get started.”
Read the full report and press release, here.
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