Why an employee bonus should not just be for Christmas
You can’t turn on the television at the moment without mention of the cost-of-living crisis. We’re living in tough times.
HR leaders face a battle to maintain and improve culture. A multi-generational workforce all have different needs, and keeping everyone happy can be a tough task. Zest has looked at what financial support employers can provide to ensure your most prized assets are looked after throughout the year.
It’s the Great Christmas Bonus conundrum. According to research by Zest, six in 10 (58%) workers aged 18-34 admit bonuses are a lifeline in the cost of living crisis. There’s no doubt it’s a timely boost.
However, of those who receive a Christmas bonus, six in 10 (61%) younger employees would prefer year-round financial support such as workplace savings schemes or discount vouchers over a one-off Christmas bonus – compared with just one-fifth (21%) of older employees.
A Christmas bonus is a wonderful gesture, but it shouldn’t define your financial wellbeing support.
1. Pension education
Pensions can be a difficult subject. It’s never easy to wave goodbye to cash you won’t see for a considerable amount of time, but a sensible approach to future savings can set you up for a financially secure retirement. That’s may seem impossible in today’s climate.
The maximum state pension for those that reach 66, as things stand, is £10,600 a year. Could you meet your entire day-to-day living costs with a weekly income of just £203.85?
Benefit experts believe employees will need roughly £300,000 to fund their future after employment. That figure might be a thing of nightmares, so financial education is just as important as the financial package you offer.
2. Wellbeing fund
It doesn’t have to be all work and no play.
Most people spend a large percentage of their time at work, and it can be an important part of our lives. But our health, wealth and self is key, and a wellbeing fund is the ideal way to help support colleagues who want to strike the perfect work/life balance.
As an employer, you could contribute, for example, £15 each month to an employee’s wellbeing fund. It enables your staff to use a pot of money to claim back cash spent on their own wellbeing. whether its gym membership, fitness classes, optical or dental check-ups, improving your wellbeing approach can help people.
3. Financial education tools
A simple way to help employees with the cost-of-living crisis is to point them in the right direction when it comes to financial education.
There’s many tools and platforms that can help colleagues stretch every penny and save a few pounds. These include:
- Financial awareness providers
- Government advice
- Free financial support from a bank/BoE education resources
- Money management providers and BBC Money Matters
4. Discounts and savings
An employee discount platform could help employees save up to £1,000 a year. Whether they’re looking to cut the cost on a trip abroad or save on the cost of the latest gadgets, providing the option to get something for less is always welcome.
Several of the offers and discounts are exclusive to the platform, with some of the UK’s most popular retailers and service providers there to save money whenever and wherever you need it.
5. Save-as-you-earn schemes
Save As You Earn (SAYE) is a monthly saving scheme that gives employees the option to buy shares in your company at the end of the scheme.
The scheme is set up by the employer and must be available to all employees who have been with the company for a certain amount of time.
Employees can save up to £500 each month while the scheme lasts – it usually runs for three or five years.
At the end of the scheme, the employee can either take the money (and any bonus or interest) as cash or use it to buy shares in the company.
The share price is set at the beginning of the scheme and can be discounted by up to 20% of the market value on that date – so, if the company does particularly well during the lifetime of the scheme, the employee could end up buying them at a lower price than their current value.
Plus, there’s no income tax payable on the sale of the shares. (The employee may be liable for Capital Gains tax)
Other options include a Workplace savings plan or a Workplace ISA.
6. Improved benefits package
While Zest research shows that ongoing financial challenges mean one-third (29%) of businesses say they’re unable to raise salaries, there is increased importance on benefits.
Half (46%) of all employees say the benefits on offer are the most important factor when considering a new role, rising to 57% among younger employees.
Benefits are key to attracting and retaining top talent. There’s no one-size-fits-all approach. A tailored package can boost motivation and productivity, and will arguably provide a more attractive proposition than a bonus incentive.
Get in touch today to see how Zest can help implement your benefits platform.
In partnership with Zest
Zest is the next generation platform that’s reinventing the world of employee benefits.
