Are your benefits clear?

Steve WrightUncategorizedLeave a Comment

Only 40% of employees appreciate their workplace benefits

“Someone is sitting in the shade today, because someone else planted a tree a long time ago.”
Warren Buffet

New research from Willis Towers Watson entitled ‘2017 Benefits Attitudes Survey’ showed that despite less than 40% of employees appreciating their benefits, 61% of employers believed they did.

There is clearly a disconnect between employee and employer attitudes to benefits, and the study found a clear correlation between benefits choice and appreciation.
72% of employees given a choice of benefits said their package met their needs, compared with 21% where no choice was offered. Given the choice, 66% of employees said they would sacrifice salary for more generous pension benefits.

The research also showed that different employee populations want different things from their benefits. For example, baby boomers are more likely to cite retirement planning as their preferred benefit than millennials, while younger workers are more likely to choose annual unpaid leave than their older counterparts

Not all benefits cost money
According to a survey carried out by Totaljobs in 2017 of nearly 7,000 workers across all sectors and age-groups, almost 60% believed flexible working hours was the most important benefit.

This compared to 54% who thought their pension was the most important benefit, 24% thinking annual leave above the statutory requirement was, 23% for annual bonuses, and 19% having the ability to work from home.

The research also found that:

  • 38% of employers offer remote working options
  • 28% of employees said they would move jobs if not allowed to work from home
  • 
46% of employees aged 18–34 would prefer to work from home, compared to 31% aged 55 or above
  • 
19% of employers thought their staff are more productive and happier working from home, compared to 21% of employees
  • 
12% of employers do not offer remote working options because they find it too difficult to manage – or don’t trust their employees!

Do your employees 
appreciate their benefits?
In order to value and appreciate the money you may be spending – or are thinking of spending on providing your employees with a benefits package – they must understand them first.

Communication is key, and this is particularly important for traditional core benefits, such as pensions and health insurance.

Do your employees understand their benefits?
Only when your employees understand the benefits you provide them will they appreciate them – maybe for the first time.

Let’s be honest, there is little point in spending money on providing benefits if they don’t.

Do your employees 
value their benefits?
Only when employees understand and appreciate the benefits they receive will they truly value them.

Eureka! The money you spend on providing benefits will then be a very worthwhile investment and achieve the objectives you set when deciding to offer a benefits package as part of your staff rewards.

We know it’s a good idea, but it costs too much
Providing benefits usually cost less than you think – for example, a group life assurance scheme may cost less than 1% of your payroll, but the perceived value is huge. If you’re an employee earning £25,000 a year, and you know your family will get £50,000 to £100,000 if you die, that has significant value in their mind.

How much do you spend on recruitment and training because people leave and need replacing? It’s probably a lot more than you spend on benefits that can help reduce your staff turnover, and therefore reduce your recruitment and training needs.

Examples of benefits

Statutory:

  • Workplace Pension Scheme – it is a legal requirement for anyone who employs people to provide a workplace pension. The minimum statutory contributions (April 2019) are 3% employer and 5% employee – 8% combined (but typical employer contribution is 6%)

Optional:

  • Group Life Assurance – a low-cost benefit with a high perceived value amongst employee
  • 
Private Medical (Health) Insurance – unlike other benefits, a P11D benefit, but greatly valued by employees and group rates. Typically one third cheaper than individual rates, and employees can add family members
  • 
Income Protection – protects the employer and employee from loss of income in the event of long-term illness or disability, until they return to work or to State Pension Age
  • 
Employee Assistance Programme – often provided free of cost when group products are purchased by the employer. Includes 24/7 advice and counselling helpline for employees with health issues, including bereavement and mental health

“If you take care of your employees, they will take care of your clients”
Richard Branson

NO PART OF THIS PRESENTATION CONSTITUTES ADVICE, AND IT IS NOT A RECOMMENDATION. ADVICE SHOULD BE SOUGHT BY A SUITABLY QUALIFIED PROFESSIONAL ADVISER AND IS BASED ON THE INDIVIDUAL NEEDS AND CIRCUMSTANCES OF THE COMPANY/EMPLOYER.

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