Providing an accessible and affordable benefits package for you and your employees
If you’re asking yourself whether you should invest more or less in benefits or, if you don’t have anything beyond an auto-enrolment pension, whether you can even afford to invest at all, ask yourself this; can you afford not to?
You only need look at recruitment websites, such as Glassdoor, to see that employee benefits matter to people; benefits even get their own review tab. And if you read a few of these reviews, you start to piece together a useful picture of an organisation’s culture, purpose and values. Benefits represent an important part of the Employee Value Proposition (EVP); in other words, everything the employer is offering to help attract and retain employees.
But don’t just take our word for it. Nearly 9 in 10 (88.7%) students said they would be more likely to apply to an organisation that is open about its commitment to supporting the mental health of its employees.*
It’s a culture thing
Benefits represent a crucial part of your wellbeing offering to employees. Not only when it comes to recruitment, but also in a wider organisational wellbeing and culture sense. People want to know that their employer cares and trust is the new employer-employee contract; now more than ever. New recruits won’t stick around for long if the reality doesn’t live up to the promise. Not only that but they’ll share their negative experiences and views publicly, impacting reputation in the process.
And a motivation thing
There’s also the question of employee motivation. Employees can’t be productive if they’re not motivated. And they won’t be motivated unless they’re enjoying a positive experience working for your organisation.
Of course, wellbeing represents just one contributor to that positive experience, but it’s an important one. It could be argued that health and happiness lay the foundation for everything else; good management practices (and managers per se!), the actual work environment, technology and communication.
Also, competitive edge
It’s also worth looking at what your peers are doing. Especially if you’re an SME in an industry where you have to compete for talent with big-name brands. And there, it’s telling that in spite of the fact that many businesses are facing financial challenges, fewer than 1 in 10 UK employers (8%) intend to cut benefits, finds Gallagher’s 2020 Benefits Strategy and Benchmarking Survey.
In fact, even though cost is highlighted as the biggest challenge to managing benefit packages, over 7 in 10 (73%) intend to enhance their benefit packages.
The report states this shows that “benefits are widely seen as a crucial element of the EVP and worthy of investment”.
Prevention, not perks
This is all fine where you have an existing benefit budget, but what if you don’t have much - or anything - beyond an auto enrolment pension and death-in-service? Here, it’s worth looking at what you spend on one-off perks. It’s probably far more than what you’d spend on a benefits programme.
Consider this. Medium sized employers (250+ employees) spend an average £1,952.70 per employee, per year on one-off perks, such as celebrations and vouchers.**
For a quarter of that spend on Legal & General’s Protect, employers could offer the foundations of an all-employee protection and wellbeing programme, with financial peace of mind in case of long-term illness or injury as standard, plus prevention, early intervention and rehabilitation benefits. Protect is a mobile-first solution for businesses with 500+ employees that brings to employees the kind of digital experience they’re used to in their everyday lives.
It provides group insurance cover for Life, Critical Illness Cover (CIC) and Income Protection (IP); either on an employer-paid or voluntary basis. Also, a range of embedded value services are included at no extra cost, from an EAP, eldercare support and Long Covid support packages to second medical opinions, nurse support services and medical concierge.
Meanwhile, if you can’t divert anything from your perks’ spend - either because you’d rather not or because it’s non-existent - there’s always the option of offering voluntary benefits to employees.
This is where you basically bring to employees valuable products at great value rates – lower than they would be able to get in the retail market – thanks to the economies of scale that comes from offering benefits on a group basis. What’s more, where premiums are paid from pre-tax income, employees benefit from a further 20% discount for basic rate taxpayers or a 40% discount for higher rate taxpayers.
In addition to the cost advantages for your people, offering voluntary benefits also removes the hassle of searching for cover in the vast retail market.
For the employer, there are also benefits in terms of everything mentioned earlier; nurturing a culture of self-care and trust, plus affording a competitive edge. For example, voluntary IP (only available from L&G) and CIC can be added at no extra cost to existing Flexible Benefit schemes, allowing for either voluntary top-ups where a core level of cover is offered or fully voluntary IP and CIC where existing budgets only run to life cover.
So, back to the initial question. With so many strong business reasons to support the health and happiness of your people, plus accessible and affordable employee benefit options available to you, can you afford not to?
* Research conducted by Delineate on behalf of Legal & General in September 2019: 1,009 students aged 18 - 26
**GRiD 2019 Employer Research