Companies are looking at ways of signing all their employees up to existing occupational pension schemes rather than engaging with the new auto-enrolment scheme.
The sectors with the strongest occupational pension coverage currently are pharmaceuticals and technology where participation rates can be as high as 90 per cent, helped in part by a strong multinational presence. Shane O’Farrell, director of corporate partnerships at Irish Life, said 98 per cent of the companies it spoke to had some form of pension gap – employees who are not currently covered. This can be for a number of reasons, including that they might by serving common waiting periods before they can access such schemes.
“The definition of an employee in the legislation is so wide that inevitably almost all companies, even those who assume they have no issue, will find that they have gaps,” said Mr O’Farrell. As currently framed, he said, the legislation could even force companies to sign their non-executive directors into a workplace pension scheme.
A third option being examined is for employers to draft all staff into their existing schemes on a mandatory basis, initially with only the employer making any contribution. That is seen as fulfilling the requirements of the auto-enrolment legislation currently going through the Oireachtas.