A third of employees (33%) believe their pensions knowledge is limited or non-existent, according to the UK Employee Benefits – State of the Nation 2017 report from HR and employee benefits platform Hibob.
The survey of more than 4,000 employees and 500 benefit decision makers found that 33% of workers have little to no knowledge of pensions. However, more than half (54%) said a pension is the most important workplace benefit to them.
Nathan Long, senior pensions analyst for Hargreaves Lansdown, told HR magazine that employers could be doing more to help staff.
“The amount spent on the workplace pension makes it the most costly benefit offered by most companies,” he said. “The news that half of employees rank their employer’s scheme as the most important benefit will bring some cheer, but there is so much more that can be done. Firms that help their staff understand how they can retire with a higher income, more flexibility, or earlier than anticipated will see the appreciation of the pension benefit soar even higher.
“With a third of employees ranking their knowledge at rock bottom the opportunity to improve understanding is clearly there to be grasped," he added.
The report also found a lack of alignment between the views of employers and employees. Two-thirds of decision makers (66%) said they were only contributing the minimum required to meet legal obligations. However, half (51%) of employees reported that a pension is an important or essential factor when choosing their current job, and two-thirds (67%) agreed that it is an important part of their overall rewards package.
Ronni Zehavi, CEO of Hibob, said that the research shows not all employers understand their workers as well as they think. “Employees are saying they want to be ready for the future – the demand for pensions is strong. However, the majority of employers underestimate how important the pension is to workers,” he said. “We hope this report offers business leaders some additional insight to help them engage with and meet the needs of their workers.”
Barbara Judge, chairman of Hibob and ex-chair of the Pension Protection Fund, reiterated the importance of organisations offering the right benefits mix. “In our competitive work landscape where attracting and retaining talent can be life or death for a company, ensuring that your business offers the benefits that are important to employees is key,” she said.