In the first part of this two-part employee benefits mini series, we explored why it’s important to offer employee benefits and how to decide which benefits your business should provide. In this article, we explore the different employee benefits available.
Which employee benefits should you consider?
Pension schemes
Since the introduction of pensions auto-enrolment, all employers must provide a pension for their employees. Making them a vital part of any employee benefits package.
Despite being the second most expensive form of employee remuneration after base pay, research shows that many, if not most, employers provide above statutory contributions. Helping them meet their legal obligations and ensuring they’re looking after the wellbeing of their staff members and the future of our society.
With pension schemes adding at least an extra 3% of the payroll bill to your business’ costs, it’s vital to ensure you’re driving employee engagement with and value from your scheme. Key to doing this is flexibility and education:
Make pension savings flexible
Employees at different life stages will have different attitudes to saving for later life. Older employees will be more likely to embrace saving. While younger people could have competing priorities – like paying off student debt, saving to get onto the property ladder or raising their family.
Defined contribution pension plans with above statutory contributions gives employees the opportunity to flex their scheme payments. Empowering employees to use their pay in the way that works best for them.
Ensure employees are educated about pension schemes
Reducing pension payments, particularly early in someone’s career can be highly detrimental to the amount their pension pays out when they retire. Educating employees about the impact of their choices is critical. As is giving them the option to increase payments at a later date to make up any shortfall.
At the other end of the spectrum, some high earning individuals may breach the annual or lifetime contribution allowance limits. Helping people understand this will help them direct their money to alternative savings vehicles which are likely to be more tax efficient.
Time off and holidays
Your company must provide 20 days statutory holiday plus eight days bank holidays each year to full-time employees. However, many businesses offer additional holidays with some firms even providing unlimited holidays. From our work with a range of different firms, we see that it’s typical for companies to offer 23 days plus bank holidays.
This trend towards more time off can also be seen with other types of leave, from paternity and maternity to bereavement leave. Employers who want to stand out are offering above statutory pay, particularly for maternity, paternity and parental leave. Helping employees enjoy important times of life.
Wellbeing benefits
With greater focus on health and wellbeing, employees are increasingly looking to their employers to provide healthcare benefits. Some of the most common benefits include:
Health insurance.
Eye care and dental cover.
Mental health services – like employee assistance programmes, counselling and online coaching platforms.
Many employers also allow employees to expense health benefits like gym memberships, physiotherapy costs and other physical activities. And gym discount benefits are also becoming increasingly common as well as on-site yoga or massage.
Flexible Working
Less a benefit, more an expectation, particularly since Covid. Men and women of all ages – including those without children – have begun to demand increased flexibility, particularly in roles that can be carried out remotely.
Today, employees expect to be able to work from wherever they choose and have the flexibility to design a work schedule that fits around their life. This could mean starting and finishing early or late, taking longer lunch breaks or condensing hours into a few days.
Giving back
With the rise of corporate social responsibility, businesses have increasingly been expected to support their local communities. Many have chosen to do this by giving staff paid days off to volunteer, often for charities associated with the firm.
Last-minute days off and birthdays
Sometimes employees don’t know when they’ll need a break. Either because they’re struggling with their mental health or they can’t get out of bed. Mental health days and duvet days can be taken without any forewarning to give employees a break from work.
These schemes typically provide a limited number of days which can be taken each year, usually one day at a time. Extended periods of absence then fall under sickness absence or planned holiday. Birthday days off are also becoming an increasingly popular benefit.
Sabbaticals
Once upon a time it was only academics who could go on sabbatical. But today more businesses are reacting to employees’ desire for greater flexibility by allowing them to take extended periods off work. Employees are still employed by their employer and the time off can be paid, unpaid or a mixture of the two. Sabbaticals can be taken for a variety of reasons including for personal reasons (maybe to care for someone), go travelling or for personal growth.
Individual wellbeing or learning budgets
Wellbeing means different things to different people. So employers are responding by offering individuals a monthly budget to spend on their own wellbeing. This could help someone pay for a yoga class, get a massage or fund some physiotherapy.
Some companies are taking a similar approach to learning and development by giving their people money to spend on books and courses of their choice. Providing this level of freedom empowers employees to purchase the services and goods that are right for them. This is a far cry from the traditional approach to benefit provision with its fixed options for all.
Yoga, massage and more
With the recent focus on wellbeing, some firms are arranging for wellbeing providers to visit their offices and offer reflexology, yoga sessions and massages. Sometimes these benefits are offered at a reduced rate to employees with employers subsidising some or all of the cost.
On-site services
Less stressed employees means happier and more engaged employees. Which is where the idea behind this benefit comes from. Usually the domain of larger employers, some businesses aim to make their employees’ lives that little bit easier with arrangements to drop off and pick up dry cleaning, on-site creches and restaurants and even car and bike servicing. Some of these services might be discounted or subsidised by the employer.
Training and development courses
Some employers include paid qualifications in their employee benefit package. Not only does this help attract and retain employees, but it increases productivity by enhancing your workforce’s skills. And it can boost employee loyalty, keeping people with your business for longer.
These are some of the more common employee benefits we’re seeing employers offer. By understanding which benefits make sense for your business, you can decide which benefits to cost up, make the business case and roll them out. For a wide range of HR services, get in touch with Pace HR on 0208 016 3029 or at info@pace-hr.com.
