What do companies need to know to communicate pensions effectively? Reward canvassed communications experts and HR directors to find out


According to the Institute of Internal Communication, pensions are not the hardest subject to communicate. Members say concepts such as ‘raising awareness of organisational objects’ (36%) and ‘change programmes’ (26%) are more likely to keep them awake at night.

And yet consistently, HR professionals still regard pensions as a thorny subject to explain. Maybe it accounts for why a staggering 30% of companies don’t offer any pensions communication at all, as revealed in Aviva’s recent Working Lives 2012 report. It finds 24% of HRDs leave it to their trustees or pensions providers, while only 8% offer it as part of regular line manager-to-staff communications. But with four in ten firms changing their pensions this year according to the CIPD, and auto-enrolment seeing more changes to staff pensions than ever before, HRDs will have to bite the communications bullet.

Know your workforce

Two factors have a significant impact on the approach that cosmetics firm L’Oreal takes to its communication programme: the average age of its employees (a relatively young 35), and the fact that 2,200 of its 3,000 UK workforce are spread out geographically, working as counter staff in department stores. These workers have limited interaction with head office and this is reflected in the fact that while take-up of pensions is 30% among all staff overall, it’s just 15% amongst counter staff.

“Last year we ran an awareness campaign aimed at younger employees, for whom claiming a pension might be perceived as a distant reality,” says its HR director Isabelle Minneci. Rather than stodgy information, the company produced much more interactive solutions. “After asking staff about their attitudes to pensions we developed a short film offering advice from experts, and we have made it easier for employees at any stage in their career to find simple information on our intranet, or to join the scheme.”

She adds: “We’ve been very clear about making pensions more relevant to people’s lives. Uptake is something we’re keen to improve on. We believe that writing in a better way – with more of a personal touch – will make the biggest difference. As a responsible employer we aim to ensure that our employees are aware of the benefits we provide for them and how we can help them plan for their retirement.”

Think about the content/words

It sounds obvious, but according to Jerry Edmonson, head of benefit communications at JLT Benefit Solutions, wording should now take on almost tactical consideration. “Firms need a more journalist style, rather than talking about the mechanics,” he says. As a former NLP student he argues certain ‘halo’ words (such as ‘warm’) have a disproportionate impact on people’s behaviours, without staff feeling like they’ve been coerced.

“I’m not saying we should call pensions ‘warm’, but there are ways to encourage people to make good decisions. For example, when talking about DC risk options, avoid using extremes,” he says. “People see them as exactly this – extremes, and will tend to react to them accordingly. Listing them alphabetically will ensure people give them more considered attention.”

A worry, he argues, is that auto-enrolment could cause reduced effort in pension communication –  especially as low take-up may well suit smaller firms, for whom providing pension contributions will be a new cost burden. “The overriding priority is that you don’t want to have people in the box labelled ‘disgruntled’,” when it comes to pensions, he says. “Use words that treat people like ‘people’ rather than as ‘members’.”


“Employees [who are not in a scheme already] typically fall into one of two groups – those who don’t know anything about pensions, or those who’ve specifically decided not to join a pension, for one reason or another,” says Peter McInulty, CEO of Rubicon Communications, which provides pension communications for the likes of Stagecoach and Dow. “With many having their own preconceived ideas, the key is making pensions personal to people.” As such, McInulty is an advocate of pension ‘sliders’ and online planning tools that allow people to input their own salaries, contributions and levels of investment risk. Staff can see for themselves what difference changes to their contributions, or investment choices makes to their pension pots.

“Most people don’t have a grasp of what they need to be saving – even the basics, such as the fact that a £100,000 pension pot only translates to around a £5,000 pa annuity. Planning tools show the effect of savings starkly, as well as the impact of what age they start saving. Many Gen Y’s still think you don’t need to start saving for a pension till their 30s or 40s,” he says.

Be channel and frequency savvy

“More than a third of employees we spoke to wanted instant access to information about their pension or workplace benefits,” says Graham Boffey, managing director of corporate benefits at Aviva, commenting on the findings of recent research into communications. However, he also advises caution. Aviva found some 19% of staff wanted to hear about workplace savings once a year, yet an almost identical 18% wanted information on a regular basis, with 17% wanting it on a secure intranet. Dealing with mixed groups of preferences makes it even more important that firms concentrate on what he calls “communicating the right type of information, in a relevant and timely fashion”.

Multi-channel options can mean more expense, though. Consistency is also key – “Make sure employees receive the same quality of comms,” says Jon Pearce, managing director, employee communications at consultancy Ferrier Pearce. This only reiterates the importance of knowing the audience, adds Johanna Lennon, communications consultant, Aon Hewitt. “There’s an assumption people will be happy reading work-related stuff on their private tools such as iPads and iPhones,” she says. “But I don’t think this is the case in pensions communications. Stick to what people want or can access at work.” 

Face-to-face communication

According to Sandra Parsons, HR director at the Institution of Civil Engineers (ICE), the old maxim that only 7% of communication is words, and that the majority (55%) is visual (body language and tone and pitch) has never been truer when it comes to pensions. “Of all the things we’ve recently done, face-to-face communication has really changed people’s view of their pensions,” she says, recounting ICE’s dramatic transformation in fortunes since 2008, when pension uptake was only 49%.

“Every member of our staff – some 320 people – has since been given one-to-one advice, including information about taking their pension through salary sacrifice. The realisation that pensions are a valuable benefit has gone through the roof.” According to Parsons, membership of its pension scheme has increased by 25%, and not only that, 88% of people from its old DC scheme (members of which were transferred into ICE’s new, replacement, company-wide scheme), actually increased their contributions.

Today, some 67% of members are on course to meet income targets – those set in their face-to-face meetings. At the start of the process, only 24% of members’ income ambitions would have been met. Mark Bingham, partner at consultancy Secondsight, which provided the face-to-face meetings, says: “People can’t value something they don’t understand. Communication was not based on how pensions worked, but simply how to take people to the next stage of the signing up process. It asked what minimum incomes people would like, giving them control. That way people soon realised that what they could gain from ICE was something they could be really grateful for.” He concludes: “We find most people simply want to be led through a process, by someone who they feel knows what they’re talking about.”

Dotting the i’s and crossing the (legal) t’s

Planning an effective communications strategy is not helped by what some describe as antiquated legislation, which determines that employers may only give ‘guidance’ but not ‘advice’ – with the interpretation on this still subjective. “Occupational pensions disclosure regulations date from 1987, and were last updated in 1996,” says Katie Frost, director at Shilling Communication. “The world of pensions has moved on greatly, and the regulation just isn’t clear enough. Ideally employers need to be able to say that younger people in particular should consider equities as part of their investment choice; but you can’t say that. You have to couch it in terms like ‘other people your age have equities as part of their mix’.”

Pensions lawyer Matthew Giles of Squire Sanders says HRDs should stick to communicating about auto-enrolment and pensions as a benefit on its own, and not mixed in with anything else, in order to remain on the right side of auto-enrolment legislation. “It’s not a good idea to talk about other excellent benefits in the same piece of communication,” he says. “It could be seen as providing inducements towards not taking out a pension.”

Outsourcing or in-house?

What do you want to achieve with your pensions communications? Can you do that on an ongoing basis? Is the skill-set of the people responsible for communication in your company up to the job? If not, what training is needed to get them up to speed? Are these people the right influencers in the business? Are you confident they can deliver the key messages? Start listing out these questions, and according to Johanna Lennon, communications consultant, Aon Hewitt, it’s little wonder that outsourcing communications could be an attractive option.

“However, people think it’s either/or [in terms of outsourcing] – but it’s not,” she argues. “Agencies are more willing to share the workload than they were a few years ago, allowing firms to keep what they think they can do best and outsource the rest.” She argues outsourcing gives smaller firms economies on elements like printing and materials, as well as access to professional copywriters and legal teams. They are also removed from the day-to-day internal machinations of companies, which can sometimes fog communications.

Full outsourcing, however, is not cheap. “Depending on the channels used, bank on £30,000 being set aside,” Lennon says. “It’s worth it, though. Companies doing it in-house often fall into the trap of thinking what they’ve done is brilliant. One company I visited thought just this. They had done a lot of work using online channels, thinking it would save them money. However, focus groups found out that what most people valued most were small, portable wallet-style cards that its mobile workers (drivers, and those not internet-enabled) could refer to when they had a moment.”

In May NEST, the government-sponsored workplace pension scheme, launched its own ‘8 Golden Rules’ for communicating auto enrolment to a new generation of savers. These are:


Use examples people can relate to and avoid abstract concepts.


Tell people what they’re entitled to, not what they should be doing


Make pensions relevant to their lives now and don’t focus on the details of retirement

  •   ONE FOR ALL 

Make it clear automatic enrolment is happening to most workers, not just them


Present the facts and avoid ‘spin’. People want to make up their own minds


(even if they don’t use it):

Tell people about their choices and not that everything’s done for them


Give people access to information that matches their knowledge and interest. Be constructive


Not problems or scare stories