For any business there are good reasons to focus on this now. A buoyant jobs market means every employer will have to compete to attract and retain the best people. Meanwhile, the impact of pay freezes and inflation on the standard of living means that squeezed employees will be more likely to look elsewhere to improve their situation.
What this means is that every employer should start thinking strategically about whether their reward mix is delivering what their current and prospective employees want. Although employees inevitably focus on take-home pay it is with employee benefits where employers can make a substantial difference to their attractiveness as a place to work.
What’s more, by focussing on this area and making the right benefits choice, this doesn’t just put money into the pocket of employees, but can save the business money too. So what should your business be looking to do? Here are four priorities:
1. Salary sacrifice
Providing benefits through salary sacrifice is one of the best ways of saving your employees and your business money. Despite planned changes to the scheme in the future, for working parents, childcare vouchers remain a hugely attractive salary sacrifice benefit, saving employees tax and national insurance on up to £2,916 per year of their wages. Salary sacrifice schemes can cover workplace parking, the purchase of bikes and, significantly, pension contributions.
2. Voluntary benefits
It’s a misconception that employees only value employer-funded benefits. Voluntary benefits allow you to offer access to discounts on a range of things that your employees will already be paying for. A typical scheme will offer access to personal insurance such as critical illness cover, gym memberships and a wide range of retail and leisure savings. Many organisations now use voluntary benefits as an integral part of the benefits mix.
3. Non-traditional benefits
When you look at surveys where employees talk about a great place to work, top of the list of things they value is support from their employer and flexibility to manage their work life balance. The option of flexible working, compressed hours and / or the support to work remotely are extremely highly valued benefits for employees and can save substantial amounts of money in travel, childcare in addition to the lifestyle gains.
4. Health and wellbeing benefits
Sickness absence and poor health a drag on the productivity of your business. They don’t just have an impact on the employee concerned but on their colleagues and managers who have to pick up the slack. Providing benefits which protect your employees’ health and maximise their chance of a swift return to work should be a priority for every business. Health cash plans provide a great alternative to health insurance and will be of genuine value to every employee who needs to visit a doctor or a dentist.
Employee assistance programmes can also provide a great front line of support for employees who need help and advice on medical issues.
Because every organisation is different, you need to make a judgement about what kinds of benefits will suit your business best. This is about balancing the needs of the business – specifically thinking about the kind of people do you need to employ and the kind of culture you want – against the needs of the employees.
The most critical thing is to get a strategy in place for your reward mix, a process for communicating it systematically to new and existing employees and a way of regularly reviewing whether it is doing the job it should be doing.
Andy Philpott is sales and marketing director at Edenred.
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