Automatic enrolment (AE) could result in reduced or no pay rises for the workforce,18% of employers, pension providers and payroll software developers have said in a survey six months following the launch of AE.

Three per cent more respondents now share this view, increasing from 15% in 2012 to 18% in 2013, according to the Chartered Institute of Payroll Professionals’ (CIPP) survey of 95 respondents.

Those who said they would potentially cut the workforce also grew in the aftermath of the launch to 6% in 2013 – a 5% rise on 2012’s pre-AE survey results.

However, employers appear more prepared for AE than in 2012. Sixty-two per cent said they had a qualifying pension scheme in place, up from last year’s 50%, but most employers expect less than 25% of their workforce needing to be automatically enrolled. The same is expected of opt-out rates.

The majority are set to stage in 2013 while 39% had a staging date in 2014.

In addition, employers have carried out workforce assessments, meaning they will be better equipped to understand the implications of AE on their business; and a majority are aware of their software capability, despite that a higher percentage of those who use a part or fully outsourced service are yet to discuss their service level agreements.

CIPP associate director of policy, research and strategic visibility Karen Thomson said: “2013 is the year for the payroll and pensions industry with automatic enrolment underway and the imminent introduction of real time information (RTI) reporting.

“It is also positive to see that more organisations have carried out workforce assessments and are thus better equipped to understand the implications on their business. Additionally, the report has revealed that payroll software providers are now taking more of a leading role in advising and providing services to clients to help them with the automatic enrolment process.”

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