Flexible benefits

Make it possible for employees to vary their pay and benefits to suit their personal requirements. Either they can change the mix of benefits they receive, without affecting their pay, or adjust their pay by taking fewer or more benefits. The employer may fund all or part of the benefits.

There is no standard approach to flexible benefits. Scheme design typically uses the following components:


Flexible benefits
Flex pot/ benefit allowance/ flex account A percentage of salary which the employee must spend on a range of benefits or if permitted, take as cash.
Benefit ‘trading’ More of one benefit can be chosen by taking less of others, such as the sale of holiday entitlement to fund greater income protection cover.
Salary sacrifice

Employee gives up or ‘sacrifices’ part of their salary – in exchange the employer provides a non-cash benefit. For example, pensions, childcare vouchers or company cars.

Employer National Insurance (NI) savings can be used to offset administration costs or be returned to employees. 

Salary deduction

Employee pays for the benefit with a deduction from either their net or gross salary (dependant on the tax status of the benefit).

For further details about our flexible benefits, refer to the relevant product technical guide.

PDF file: Group life assurance and dependants' pension technical guide PDF size: 555KB  

PDF file: Group income protection technical guide PDF size: 840KB  

PDF file: Critical illness cover technical guide PDF size: 367KB  

We have bespoke technical guides for our  voluntary group life and voluntary critical illness benefits.