What employers can do to strengthen their employee offering
Following the recent Budget announcements regarding employer National Insurance, a host of labour-intensive businesses are warning that slower pay growth and job losses are now inevitable.
So how can employers strengthen their employee offering to support recruitment, retention and engagement in an environment of increasing employment costs?
Focus on total reward
Although pay and job security were rated by employees as the two most important aspects of the employment package in an Isio study*, employees increasingly value the total reward package.
This goes beyond pay to include benefits, work-life balance, career development and recognition.
Considered holistically, there are opportunities to develop a more compelling value proposition, without solely relying on pay.
(*In conjunction with YouGov, Isio surveyed 7,674 private sector employees in June 2023 on a range of issues surrounding employee benefits and personal finance concerns. Responses for don’t know or prefer not to say answers have been removed, unless explicitly shown.)
Benefits: Tailoring benefits to meet employees’ real-world needs can significantly enhance the perceived value of the employment package – our study showed that employees whose benefits met all their requirements were 45% more likely to stay with their current employer.
Enabling flexibility and incorporating employee feedback into the benefit design can help employers deliver a more targeted and valued offering.
Further, where appropriate, approved salary sacrifice benefits such as pension and electric vehicles can be used to help mitigate the cost of increased employer NI.
Work-life balance: Flexible/hybrid working arrangements, family friendly policies and additional leave can improve employee satisfaction and productivity.
Isio’s research shows that these benefits are highly valued by employees and can help offset the impact of more limited pay budgets.
These policies can also be used to signal an employer’s values, embed trust and can be very effective in people-led organisations.
Career development: Opportunities for professional growth, such as training programs, mentorship, and clear career progression paths, can enhance employee engagement and retention.
Investing in employee development demonstrates a commitment to their long-term success.
Recognition and rewards: Implementing a robust recognition program that celebrates achievements and milestones can boost morale and motivation, and regular recognition reinforces a positive workplace culture.
Define your employee value proposition (EVP)
The EVP is the unique set of benefits and values that an employer offers.
It goes beyond the total reward package, encompassing elements such as culture, location, physical and psychological safety, and company values.
A clear and compelling EVP attracts top talent, enhances retention, builds a strong employer brand, improves engagement and productivity, and differentiates your company from competitors – it can do more than the traditional reward strategy.
By investing resources in defining your EVP – which should include understanding why your employees want to work for you, and mapping this across to your mission and values – you can create a more attractive, engaging, and successful workplace.
Invest in communication and engagement
The success of any reward strategy and/or EVP is reliant on the supporting communication and engagement tools.
Employees need to understand and engage with what the employer is providing to feel and appreciate the value being delivered.
A multi-channel approach, using personalisation and interactivity, is seen as best practice.
For example, our survey showed that total reward atatements can increase employee appreciation of benefits by 48%, so they are effective, yet they can take very different formats.
While static PDF statements get the job done, employees may not be prepared to take the time to read and digest the information.
Alternatively, an interactive statement can be used to provide headline information in an engaging manner, whilst layering the detail for those who want it.
In summary, employers can navigate the pressures of increasing costs by focusing more holistically on total reward and the employee value proposition, while investing in effective communication and engagement tools to maximize the employee experience.
In partnership with Isio
A forward-looking approach to employee benefits, creating value for today and tomorrow. Helping you and your employees get the most from their benefits.
