Small Firms Must Set Up Pension Schemes

Small businesses that employ fewer than 30 people will be asked to enrol their staff in a company pension scheme from Monday.

The new regulations cover companies that employ anyone over the age of 22 who earns more than £10,000 a year, as well as people with a single employee such as a nanny.

Each employer will be given a deadline for putting plans in place and 14,000 will be affected by the first phase, which starts this week.

It is part of the Government's automatic enrolment scheme, which was established amid fears people were not putting enough money aside for their old age.

By the end of October 2017, as many as 1.3 million small businesses will be signed up, enrolling 10 million workers into a pension scheme.

But it will not be easy for everyone.

Liesl Smith from the Federation of Small Businesses said: "Often they get bogged down in running the business and so they don't necessarily have time to think about the actual human resource part of the business… so I think it's a real challenge particularly for smaller businesses."

Smaller companies such as hairdressers and grocers will be included as the scheme rolls out.

In some cases, people might be employing just one person, such as a nanny or a carer.

Employers could ultimately be fined if they ignore their auto-enrolment duties.

Sky News visited a jewellers in Birmingham where they are preparing to introduce a pension scheme.

It is going to cost £4,000 to set up by their deadline of February 2017.

Owner Adam Bicknell told Sky News: "We haven't really got any choice, we just have to get on with it.

"I think because we've got another 18 months we are a little bit less knowledgeable at the moment but I'm sure when we are getting closer, we will start really pushing forward."

His staff are delighted with the news.

Sales assistant Kirk Field said: "It's got its pluses and its minuses I'm sure for businesses. For me it's going to be a plus because I can control how much I put into it, as much as possible really."