Pensions administrators have had to adapt to home working in record time, and the relatively smooth change has been praised as one of the industry’s great successes. This week, some staff are returning to the office, but is the biggest change yet to come? 

 

As the UK went into lockdown in March, the Pensions Regulator followed up with guidance for pension schemes that required them to continue to perform the most crucial functions such as pension payments and processing retirements but allowed them to suspend transfers. 

 

During that time, many schemes asked members to only contact administrators if they absolutely needed to, some noting the reduced telephone capacity of their administrator. 

 

Now, some are acknowledging the return to business as usual. The Sainsbury’s pension scheme is informing members that “normal service resumes” at its administrator Willis Towers Watson: “We’re delighted to let you know that Willis Towers Watson has resumed a full administration service for Scheme members, after the initial disruption caused by the coronavirus pandemic.” 

 

Other schemes also reported reduced service from Willis Towers Watson during the lockdown; the GSK Pension Plan and its sister schemes told members that “Willis Towers Watson have advised that they will place priority focus on critical processes". 

 

Kevin Howard, head of operations for pension administration business at Willis Towers Watson, said the company plans for about 20% of staff to return to the office*. “We've prioritised based on colleagues’ needs not business needs,” he said, stressing how well the team has responded to lockdown.  

 

“We are absolutely supporting the ability to work from home,” he added, as the company is “mindful” of regional lockdowns in the UK, where it has offices in Redhill, Leeds and Welwyn Garden City, as well as using offshore centres in Manila and Mumbai. 

 

Howard explained that the administration business has changed significantly since March. "If we look pre-Covid we were a 98% office-centred business model,” he said. “Within days, we shifted 1,000 heads in three countries”, which included buying 500 laptops.  

 

This overnight shift to remote working has been an opportunity as well, he noted, as clients and members were equally moving to digital, accelerating a trend administrators had wanted to see for years. 

 

While productivity has been very good during home working, training and recruitment were interrupted initially, an issue that has been dealt with since. The company is now able to handle large volumes of member requests, he said. “We're now at a point where membership demand is in line with what was anticipated prior to Covid."

 

But what about the longer-term? “I don’t think our operating model will ever go back to where it was this time last year... We expect to see much more of a balance between home and office working,” he said.  

 

This will ultimately also provide an opportunity to recruit from a wider geographical pool he observed, as it avoids the need for a particular skill set to be in a particular location; still, he does not expect a big move away from having office hubs and places. Howard denies that the ability to recruit anywhere will push down salaries, and ultimately prices: "We're not looking at flexibility as a cost arbitrage.” 

 

The company already uses offshore hubs, a fact he said was useful during this period. “While we were managing the [lockdown restrictions in the] UK ,we were able to do offshore; when Mumbai went into a challenging situation, we were able to flex work there,” he said. 

 

 

Others however point to challenges presented by offshore working in an environment such as this, including ensuring data protection.  

 

“Location does make a difference. Administrators working in the UK have only had to deal with lockdown measures in our own country. Those who offshored had to deal with different restrictions and data security issues,” said Daniel Taylor, client director at Trafalgar House Pensions Administration. In offshore locations, “most of their data security protocols are based on physical restriction and access to laptops. You can't overnight tell them to take laptops out of those locations,” he added. 

 

However, the sudden move to home working has also sparked interest in change at Trafalgar House. “We are fundamentally reconsidering our long-term technology strategy, on the basis that the whole of our business is moving to a remote first basis, ensuring everyone is remote enabled, rather than just pockets of people,” he said. 

 

This means the company is seeing this as an opportunity as “to become location agnostic really enables you to consider service provision not from a single location” but to hire people remotely, he said. “It opens up the whole of the UK as a potential employee base." 

 

But it seems the office will still form part of the future for Trafalgar House as well. Last week, the administrator opened its Farnborough office, while the London office is reopening this week, mainly for the service delivery teams. Staff will work one week in the office and one remotely. “We'll probably maintain that until the end of the year,” said Taylor. 

 

 

A full move to home working for administrators could be difficult, said Michael Clark, managing director at trustee firm CBC Pension Services, as administration staff tend to be younger. “If you’re living with mum and dad or in a flat share you’d be going stir crazy,” he said, adding that younger people might miss seeing colleagues and having informal chats. 

 

But he agreed administrators have responded well to the crisis, and as a result, there is greater acceptance that administrators can work successfully from home - and that many will probably continue to do so in future. 

 

While there is currently a move back to the office across some admin firms, these are still relatively small numbers, consisting mainly of those who want to work in an office, agreed Ian McQuade, director at governance specialists Muse Advisory. 

  

“In almost all cases we have heard about, the people going back are those who would prefer to be in the office due to the working environment – whether that be due to them being in shared flats, or living at home with parents, they feel that [they] will be more productive in an office,” he said. 

 

McQuade said while he expects to see small increases in numbers of people working from the office as each month passes, many firms are “fairly confident in their working from home protocols and are therefore more relaxed about members continuing to work from home at least into next year”.