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Aon Hewitt survey confirms that few organisations expect to use NEST
London
NYSE: AON

LONDON, 15 December 2011 – Aon Hewitt, the global human resource consulting and outsourcing business of Aon Corporation (NYSE:AON), has announced the results of a survey covering planned actions connected with the introduction of auto-enrolment. The survey, which covered 110 of Aon Hewitt's clients across a broad range of industry sectors with sizes ranging from under 100 to over 30,000 employees, shows that only 2% of respondents plan to use NEST as their vehicle for auto-enrolment.

James Patten, benefits design specialist at Aon Hewitt, said:
"Our survey confirms many of the views expressed to us in conversations with clients. In our experience relatively few organisations of more than around 100 employees are expecting to adopt NEST for auto-enrolment purposes.  It seems that, where possible, many companies prefer to use existing vehicles to limit the amount of change required."

Aon Hewitt's survey also covered respondents' plans for Defined Contribution (DC) scheme design for employees who are being auto-enrolled into pension arrangements.

James Patten said:
"From a contributions perspective, none of the organisations surveyed expects to reduce DC contribution rates for existing pension savers, although some have yet to reach a decision on this issue. More good news is that almost all respondents that have reached a decision on the matter expect to give new hires access to the same DC contribution structures as existing pension savers, as long as they are prepared to make the necessary member contributions to save for retirement.

"A significant majority of those that have reached a view on their likely contribution structure are intending to use their existing DC contribution scales for auto-enrolling all employees. This may again be to limit the amount of work required to prepare for auto-enrolment.  However, it could lead to the risk of substantially higher costs to the employer, compared with if they had set up an introductory contribution scale for those being auto-enrolled at the minimum employer contribution rate of 1% of qualifying earnings - which will not increase before October 2016 at the earliest."

Aon Hewitt's survey also found that around 67% of respondents have yet to consider the implementation challenges of auto-enrolment in any detail, with only 4% likely to have made significant progress.

James Patten added:
"Many employers with less than 3,000 employees will be hoping for a breather as a result of the revised staging dates expected to be confirmed by government in the New Year. For larger employers, 2012 will clearly be a very busy year in preparing for the significant implementation challenges.  Many may look to outsource much of this work in order that they can focus on broader business challenges in what will undoubtedly be a very difficult year."

 A summary of Aon Hewitt's survey will be available early in the New Year. It can be obtained by emailing James Patten directly (james.patten@aonhewitt.com).


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About Aon Hewitt
Aon Hewitt is the global leader in human capital consulting and outsourcing solutions.  The company partners with organisations to solve their most complex benefits, talent and related financial challenges, and improve business performance.  Aon Hewitt designs, implements, communicates and administers a wide range of human capital, retirement, investment management, health care, compensation and talent management strategies.  With more than 29,000 professionals in 90 countries, Aon Hewitt makes the world a better place to work for clients and their employees.  For more information on Aon Hewitt, please visit www.aonhewitt.com.


About Aon
Aon Corporation (NYSE:AON) is the leading global provider of risk management, insurance and reinsurance brokerage, and human resources solutions and outsourcing services. Through its more than 61,000 colleagues worldwide, Aon unites to empower results for clients in over 120 countries via innovative and effective risk and people solutions and through industry-leading global resources and technical expertise. Aon has been named repeatedly as the world's best broker, best insurance intermediary, reinsurance intermediary, captives manager and best employee benefits consulting firm by multiple industry sources. Visit http://www.aon.com for more information on Aon and http://www.aon.com/manchesterunited to learn about Aon's global partnership and shirt sponsorship with Manchester United.

Media Contacts:
Colin Mayes
Aon Hewitt
01372 733689
colin.mayes@aonhewitt.com

Quintin Keanie
Capital MSL
020 7255 5154
quintin.keanie@capitalmsl.com

 

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