Choosing the right workplace pension scheme

To start with, you’ll need to consider which kind of pension arrangement suits your client’s needs, size and governance preferences.

• Contract-based (GPP / Group SIPP): These can be quick to set up, with easy online tools and many fund choices, and are worth considering for small to large companies wanting simple and flexible plans.
• Master trust: With independent trustees to manage them, master trust schemes benefit from size and strong rules. Potentially a good match for medium to large companies or those who want independent trustee control.
• Own-rules trust: Something to consider for clients who want their own trustee group and a custom plan, but needs more management and rules. 

When weighing up your options, keep these things in mind to help you compare providers.

• Reliability and reputation: Think about the provider’s size, support services, service quality and regulator status. As an adviser, you’ll need to consider how well the provider will support you and enable you to deliver for your client. 

• Costs and value: As well as checking if a provider offers value for members with their charges, consider whether they’re transparent about their fees up front or if it’s hard work to get to the details.  

• Investments: Check the quality of a provider’s main investment choice, as well as the range of self-select funds and other options like ESG, Shariah-compliant funds and risk-level funds.

• Payroll and admin: Find plans that work well with payroll systems, checks data carefully and use automated checks and messages as much as possible. 

• Employee engagement and support: Look for signs that a provider values the member experience. Apps, websites, education and retirement options that keep members interested and involved can all be good indicators.

You can help your client choose a new pension provider, but some companies must consult with their staff first. If this applies to your client, plan the steps, messages and paperwork needed well ahead of time.

Here are a few talking points to help your client understand what makes up the costs of a workplace pension.

• Minimum contributions: The total minimum contribution is 8% of qualifying earnings. Employers must pay at least 3% (though they can pay more). Employees are then required to top up to the minimum total level required. They can do this through direct employee contributions, or as salary sacrifice, where the employer pays a contribution in place of part of the employee's salary. Salary sacrifice must be voluntary, though it can be a default option.

• Qualifying earnings band: For 2026/27, this is £6,240 To £50,270 but should be checked each year. Many employers pay on full pay rather than the banded level. See what suits your client, and note the scheme terms may differ depending on the expected level of contributions.

• Other costs: Clients will need to budget for provider fees, payroll and software costs, and adviser fees if needed.

A strong default investment strategy that matches both workforce needs and employer risk appetite is essential. Meanwhile, additional simple fund choices, such as ESG or Shariah‑compliant options, help meet diverse member preferences without overcomplicating the scheme.

Try to keep an eye on the following common mistakes:

• Late or wrong assessments, especially for variable hours. Automating with payroll and checking every pay period can help here.
• Missing important messages or using wrong templates can happen, but happens less when using a provider’s tools and official TPR forms.
• Wrong tax-relief methods compared to payroll setup. Check this early and test thoroughly before going live.
• Skipping re-enrolment or filing late. Add dates to calendars during set-up to keep on track.
• Misunderstanding pension pot transfers. Remind clients that employees’ existing pension pots don’t automatically move across when changing provider. Helping your client and their employees understand how they can move any existing pension funds is valuable service clients will appreciate.