New research reveals 98% of HR and pension managers with defined-contribution schemes think employers should have a say in pension communications but 57% feel ‘constrained' in doing so by the law.
The report from the National Association of Pension Funds (NAPF), launched at its Annual Conference in a session in partnership with HR magazine, found 83% of employers were comfortable to give new joiners information about pensions, but this figure dropped to 67% when respondents were asked if they were comfortable talking to staff about contribution levels.
In fact, employers are more comfortable talking about shares (68%), life assurance (73%) and ISAs (73%) than they are talking about pension contributions.
The report found two thirds of employers surveyed feared rules from the Financial Services Authority (FSA) forbidding people who are not trained to give staff advice about finances as opposed to education. And almost half (48%) are unaware what they are allowed to tell staff, by law, and what they are not.
Every respondent to the survey was worried that staff could perceive financial education around pensions as one-to-one financial advice and 69% would like to see a legal indemnity to protect them from prosecution if they are accused of giving financial advice unwittingly.
Commenting on the findings, Faith Dickson, a partner at law firm Sacker & Partners, said: "As HR people you are not allowed to give staff advice on what you think they should do with their money because you don't know their individual financial circumstances. But you must ensure you make staff aware of how they can get the best solution possible from the employee benefits you offer.
"Don't tell people what to do or make recommendations, but encourage awareness of what you offer."
