Helen Morrissey wonders if the recent Uber decision will prompt new discussion on helping the self-employed save for retirement.
It is interesting times over at Uber after an employment tribunal found the firm's drivers have worker status and are not self-employed.
This is a decision that could have very real ramifications. If upheld, Uber drivers will be eligible for paid holiday, the national minimum wage and possibly pension benefits.
According to Royal London's policy director Steve Webb, the cost of auto-enrolling Uber's estimated 42,000 drivers could be up to £3m a year. This is at the current minimum of 1% of qualifying earnings so it will rise still further in line with increases in mandatory employer pension contributions.
The government is currently focusing on smaller employers going through the AE staging process. However, as the numbers of self-employed people continue to grow it is vitally important that some kind of support is put in place for them.
While the potential numbers are enough to make many such employers wince this story highlights a very real problem that exists in the pensions market.
So far auto-enrolment (AE) has been a real success. A huge proportion of those targeted by AE have chosen to stay in and build up a retirement pot.
However, this ignores many millions of people, including the self-employed, who currently have no entitlement to AE and so are less likely to save for their retirement.
The government is currently focusing on smaller employers going through the AE staging process. However, as the numbers of self-employed people continue to grow, it is vitally important that some kind of support is put in place for them. This is something that needs to be looked at as a matter of urgency.
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