A recent survey conducted by performance consultants PM&M found that graduates were more interested in practical company benefits, such as private healthcare and tax-free childcare, than regular holidays. Almost two-thirds of the 600 respondents cited owning their own home as their number one lifestyle ambition, but only 7% cited regular holidays and just 2% said a designer wardrobe.
So how does your company view the rewards and benefits it offers to employees, and are you missing out on areas that could be attractive to new professionals? Below is a summary of the basic elements that can be offered, along with some tips on how best to communicate these benefits.
Pay, Bonuses and rewards
Cash, whether paid as a weekly or monthly salary, is the foundation of any benefits or reward package. It is often good practice to research and consult upon the level of pay offered by other companies within your sector in order to ensure that the basic package is competitive, although basic salaries can be balanced out by the other types of rewards on offer. Bonuses, performance related pay, team incentives and other forms of variable compensation can all be used in addition to basic pay levels to make a role more attractive to potential employees.
Dependent on the role, and the geography of the working environment, companies can often provide cars to certain employees as part of the perks of their employment. Through the use of fleet management, employers can offer company cars to their employees in a number of different ways, from contributions to an employee car ownership scheme or a leased company car, or even a combination of methods. There are issues of company car tax, maintenance management and even health and safety surrounding the use of company cars, so it is a good idea to check with internal or external specialists before offering this benefit.
As individuals become ever more aware of their current and future health, companies are beginning to focus on providing new and innovative healthcare packages for their workforce. Examples of healthcare elements that your company could initiate include private medical insurance, gym membership, health screening and other employee assistance programmes. Despite the costs involved, studies have shown that an intelligently planned workforce wellbeing policy will actually save your business money through decreased sick leave, and may also significantly increase employee productivity and loyalty towards your company.
Childcare and carers
In April 2007, the 2006 Work and Families Act became law in the UK, increasing the duration of both maternity and adoption leave for parents. Within the work/life balance, employees have an increasing desire to build time in for their children or other dependants. From a tax perspective, childcare vouchers can be a mutually attractive way for both parties to navigate this benefit, although there are other ways that companies can support employee families. The Work and Families act has extended the rights of adult carers to request flexible working hours, whilst emergency childcare provision and onsite nurseries within the workplace are increasing.
The allocation of company shares to valued members of the organisation is a highly effective way to increase both productivity and loyalty, in addition to the overall value of your benefits package offered. Within the UK, companies are at liberty to design their own employee share schemes, although there are four Inland Revenue approved schemes, listed below:
- Sharesave (SAYE)
- Share Incentive Plan (SIP)
- Company Share Option Plan (CSOP)
- Enterprise Management Incentive (EMI)
The above schemes are all popular because they attract tax breaks that enable the allocation of shares and share options to be conducted in a more cost effective manner.
A contributory pension scheme is a significant benefit for employees in the UK, and by 2012 all companies will have to enroll all staff into some form of pension arrangement, or use the new National Savings Pension Scheme (NPSS). A well crafted pensions plan will work for both company and employee, and benefits from a favourable income tax and National Insurance break on contributions.
Regardless of how good your company benefits and rewards are, they will count for very little if they are not properly communicated to current and future employees. An increasingly popular method of setting out employee benefits is to create what is known as a total reward statement. A total reward statement is a concise breakdown of all the various benefits offered to each employee, which can be personalized, amended and communicated both on and offline to the employees concerned. The most useful thing you can do for your employees is to simplify the benefits and rewards as much as possible, particularly with more complex aspects such as the occupational pension, and you may find that you need external assistance with this. Check out http://www.businesslink.gov.uk for further Information.
In general, email, posters, leaflets, seminars, presentations, staff meetings, line managers, text messaging, staff handbooks and magazines are all useful tools to get the detail of your benefits scheme across.