What does your benefit strategy say about your organisation?
Companies have used their benefit strategy to differentiate themselves and contribute to employee engagement for centuries; going all the way back to the likes of Cadbury building houses for its workers and creating the town of Bourneville. The introduction of flexible benefits in the 2000s was sold on the premise that benefits schemes were staid and needed changing, diversifying and greater choice, as they had been designed by white middle-aged men for white middle-aged men, which didn’t represent the workforce.
With the introduction of pension auto-enrolment it became compulsory for every company to offer at least one benefit to their employees but, beyond that, the potential list of benefits and providers and funding make the combinations you can offer almost limitless. Whether you are an organisation just offering a pension at minimum rates or a multinational offering dozens of benefits, employees will perceive the offering as a reflection of the company. And wider than that, it will be part of your employer brand for those you want to attract.
What should you be considering when looking at your benefit scheme?
The first thing you should be doing on a regular basis is assessing your scheme to check if it is fit for purpose. There is a danger that benefit schemes get put in and then aren’t re-evaluated, go stale or end up as completely inappropriate for your company.
Once you undertake the review, your company culture and core values should be at the heart of your strategy. There are some big picture questions such as what type of company are you? Are you paternalistic or more flexible with regard to choice? How you implement your scheme will provide a reflection of this.
What benefits you offer
The benefits you offer should reinforce your culture and core values, but you need to be wary of how they can be perceived.
You should have a clear reasoning for why you have put a benefit in place and what you are trying to give your employees by including it as an option (or funded). Be wary of adding fashionable benefits like debt consolidation – unless it fits with your culture – and ensure you get the messaging right so it isn’t perceived as a slight on people that they can’t manage their money, or seen as an admission a company doesn’t pay their employees enough! Something like fertility treatment or egg freezing could also be misconstrued as telling employees that having children should be put on hold otherwise it could affect their career. So, always be wary of how benefits could be perceived and get the messaging right as to why you are offering it. As an example, you offer travel insurance because you want your employees to take a break from work and travel as it enriches their lives – and it’s important they have good cover just in case.
Keeping your scheme focussed is important as well; creating a bloated benefit scheme with too many options that detract from what you are trying to achieve can dilute it.
Providers you choose for benefits also need to be considered carefully. Are they similar companies to yourself, do they provide the right price points for the salaries of your employees? And do you have the right mix of affordable benefits?
It shouldn’t just be benefits that are provided or selected, but also holiday entitlement, paternity/maternity leave and pay, sick pay and duvet days that reflect the company’s approach to supporting their employees.
Funding
What and how you fund your benefits is one of key factors influencing how your scheme will be perceived. Do you fix a core level of cover for benefits like life insurance and medical insurance because you understand the value it provides? Do you provide the same level of cover for everyone and, if so, is this clear to everyone? Because if you have a company value of ‘transparency’ but hide these differences, you could be perceived as not being true to your values.
If ‘equality’ is a value, is it right that you provide senior staff with a higher level of funding for benefits? Another interesting question is what happens with any employer National Insurance savings? Do you reinvest in the wider scheme, add it onto an employee’s contribution or does it get used elsewhere in the business?
How you offer your scheme
The way employees choose their benefits and the technology you use will reflect the importance and emphasis you place on your strategy. Employees’ expectations are set by other consumer-type experiences, so offering a slow, counter-intuitive system won’t promote your scheme the right way and will create a negative feeling.
Another area to be wary of is that often schemes can grow over the years to become overladen with options for employees that are no longer relevant. Don’t create a scheme where employees can’t see the wood for the trees.
When it next comes to the time to review your benefits and providers ensure you take the time out to really understand what you are offering – and why. Use your culture and core values as a guide to think about what your scheme says about you and I’m sure you’ll see more successful results.
The author is Alistair Dunn-Coleman, head of product, Zest Technology.
This article is provided by Zest Technology.
In partnership with Zest
Zest is the next generation platform that’s reinventing the world of employee benefits.
