Approximately 20,000 maritime employees, fishermen and oil rig workers will qualify for the Government’s auto-enrolment scheme. In a draft legislation set out by the Department for Work and Pensions (DWP), seafarers and offshore workers will be included in the pensions auto-enrolment.

This is the Government’s flagship policy through which they hope to solve the failing pensions saving problem that has engulfed the UK. The scheme is part of the Coalitions work to reform pensions, changes which employees have fought against.

UK employee classification

Under the plan each employer will be required to provide a pension for all their staff, unless the employee opts out of the scheme. The scheme will be phased in, with the largest companies having to introduce the plan from October. After which progressively smaller companies will be required to introduce the scheme into their working practice.

Initially seafarers and offshore employees were not a part of the initiative, the problem was whether they could be classed as UK employees since they were so mobile. In a change of plan, the DWP revealed that these workers would now be a part of auto-enrolment. This was provided that they worked in UK territorial waters, on the UK Continental Shelf or in the UK sector of a cross-boundary field.

The change to the plan has meant that approximately 17,000 seafarers and 9,000 offshore employees will qualify for pensions. Despite having almost 20,000 workers eligible for the scheme it is expected that 6,000 of them will choose to opt out, this will involve employees making voluntary contributions with their employers.

The modification to the legislation does not include any people who are in the Royal Navy, this is because they have already been enrolled into the Ministry of Defence’s scheme.

In the current economic climate with inflation hitting the finances of households hard, it is expected that a many will choose to opt out of the auto-enrolment scheme. The lack of financial strength has meant that everyday Britons are finding it a struggle to set money aside for their retirement years, with only the state pension as their form of income.

Complication

One problem that might complicate the introduction of the scheme to these workers is the fact that around half of British seafarers work on non-British registered ships. While half of those working on British ships are not from other countries.

“We welcome the concept of including seafarers in pension auto-enrolment as traditionally they have been excluded from all sorts of social and welfare provisions,” said Andrew Linington, director of campaigns and communication at Nautilus International a union for maritime workers.

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