Caterers criticised over staff pension planning

The Government has singled out employers in the hospitality industry as the worst offenders as regards failing to set up stakeholder pension schemes for their employees.

The Department for Work and Pensions has identified a high proportion of restaurant and hotel businesses among the 14,000 firms that have failed to set up a stakeholder pension scheme since it became a legal requirement in October 2001.

Businesses with more than five employees are required to set up a stakeholder scheme that allows staff pension contributions to be made through payroll. Employers are not required to pay into their employees' pensions but can be fined as much as £50,000 for failing to make a scheme available to staff.

The Conservatives and the Liberal Democrats are both calling on the Occupational Pensions Regulatory Authority (OPRA), the body that oversees workplace pensions, to get tough with firms that don't set up such schemes, but OPRA says it will write to businesses again before fining them.

LibDem work and pensions spokesman Steve Webb said: "Setting up a stakeholder is not an onerous requirement - a few high-profile penalties would shake employers into action."

OPRA communications director Nick Edmans said: "We did detect a higher incidence of non-compliance in the hotel and restaurant industry. Many hospitality firms we spoke to thought they only had to ask members whether they wanted a stakeholder scheme - they didn't realise they had to set up the scheme even if the employees didn't want to join it."

\* Tell us your views. Are you one of those employers the Government is criticising? How easy did you find setting up a stakeholder pension scheme for your employees? E-mail chot@rbi.co.uk, or write to the usual Caterer address.

Source: Caterer & Hotelkeeper magazine, 23-29 January 2003