Warburtons sees 2.3% opt-out after comms drive

The bakery implemented a multimedia communications campaign prior to its staging date, emphasising that joining the scheme would result in receiving more money from the employer.

“With 1,800 employees to auto-enrol, it was important our communications resulted in a good level of engagement, so that our opt-out rate was low and employees understood the importance of saving for their retirement,” said pensions manager Anne Hunt at the National Association of Pension Funds annual conference. 

The company’s staging process saw it enrol employees from 26 sites across the country.

“The [rate] doesn’t demonstrate the level of our member engagement because with auto-enrolment there was a certain level of inertia which took place,” she said.

She added: “A member of our pensions team did speak to all our employees requesting an opt-out form. So for all those employees requesting an opt-out form, not all opted-out.”

Hunt said the true measure of success was the engagement of employees after auto-enrolment. The company found 400 of the 1,800 enrolled made a contribution choice above the minimum level.  

“Within that group, the average level of contribution, employee and employer, was 11 per cent going into their pension pots," Hunt said. The average contribution of all those auto-enrolled was 6 per cent.  

“We have had almost 350 employees who have made an investment choice. When you consider these employees had previously decided not to join a pension scheme and were disengaged with pensions, these figures demonstrate our communications strategy improved engagement, with employees making contribution and investment choices," Hunt added. 

The major theme of the communications was “getting more money from your employer”, said assistant pensions manager Graeme Mearns. 

The company used a multi-media communication strategy to communicate with non-members. “We created an automated computer desktop wallpaper for all computers screens across the business for a period of two weeks prior to the staging date,” said Mearns.

However, only 20 per cent of employees had access to a computer, so a two-stage poster campaign was used. The bakery also nominated a "pensions champion" at each site. 

Pre-staging planning

Warburtons decided to use its current defined contribution plan to ensure all its employees were in the same scheme. 

The project team spoke with Fidelity, their DC provider, as they wanted to make changes to the current  arrangement which was to be used for auto-enrolment.

Hunt recommended that schemes talk to their plan provider early in the planning process. “With so many companies going through staging they will have a tight window if you need to make any changes,” she said. 

In November 2012, the company introduced its salary sacrifice scheme PensionsWise, which provided National Insurance savings to the company and employees.

The company changed the definition of pensionable earnings and also introduced a new tier of contributions of 1 per cent from the employee and 2 per cent from the employer, with all employees given the option to pay more under the plan rules.

It also reviewed the default fund and replaced some of the self-select funds. "With the focus on improving member understanding of investment choices and giving greater flexibility to the trustees, we introduced white-labelling and also reviewed annual management charges," said Hunt.