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Herbert Smith Freehills has today become the first law firm to be accredited as a Living Pension employer. In doing so the firm has committed to help employees build pension savings designed to provide an adequate income in retirement.
"The cost-of-living crisis has highlighted the stark difficulties faced by far too many individuals who struggle to manage financially on a daily basis. The problem is magnified with many potentially unable to save for their future. Being a responsible employer is about more than ensuring staff are looked after whilst they work for you; it is about recognising that providing employees with stability and security in retirement is just as important," says Alison Brown, executive partner at Herbert Smith Freehills.
Research undertaken by the Resolution Foundation recently revealed that four in five workers, or 16 million, in defined contribution schemes - and 95% of those on low pay - are not saving at a level likely to reach an acceptable standard of living in retirement.
As a result, Herbert Smith Freehills will be enrolling new employees at a higher employer and member contribution rate to help them achieve the savings level required to meet basic everyday needs, once they stop working. Existing employees will also be encouraged to opt-up to help them save more and to benefit from higher employer contributions. As part of its commitment Herbert Smith Freehills will also work with suppliers in an effort to ensure every worker connected to the firm will be able to benefit.
Developed by the Living Wage Foundation, the Living Pension savings target is independently calculated using a basket of household goods and services. It draws on the Minimum Income Standard and takes into account different family types, circumstances and areas of residency.
"Working lives are long and individuals' priorities and commitments shift and adapt over time, with the result that planning for the future is something many people put off until tomorrow. We recognise that there will be points in time where financial planning may need adjustment so the scheme will retain flexibility, enabling participants to voluntarily increase or reduce contributions as needed. Employees already have access to a range of benefits which help in the short-term and we are delighted to be able to support them during their life at HSF and with what follows," adds Brown.
As well as leading the way for long-term financial planning within the legal sector, Herbert Smith Freehills has also provided pro bono support to the Living Wage Foundation to help launch this new employer accreditation. This has included providing technical advice on the development of the Living Pension Standards and drafting the employer licence agreements.
"We are proud to have been able to support the Living Wage Foundation in launching this important initiative, which will hopefully benefit hundreds of thousands of workers around the UK, including our own," Brown concludes.
The firm's Living Pension accreditation has been awarded just over 10 years since it became an accredited Living Wage employer.
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