Package deal.
| Author | McEvoy, Anne-Marie |
| Position | Employee benefits management |
Benefits are costly to provide and can be seriously undervalued by employees. Flexibility is the key to redressing the balance, says Anne-Marie McEvoy, and can help companies to maximise return on their benefit investment
The obligation for employers to review pension provision, and some alarming statistics on employees' perception of the value of benefits packages, are prompting companies to take a long, hard look at how to get best value from their benefit offerings.
Today, companies provide employee benefits for a number of reasons. For most, the benefits package is an important tool for recruiting and retaining key employees and for trying to outmanoeuvre competitors. In addition, it can also support business requirements -- access to prompt healthcare for staff, for example, may help to reduce disruption caused by absence.
Benefits can be used to emphasise an organisation's culture. Companies that determine levels of holiday by grade, for example, are making very obvious statements about the role of status in the organisation.
One issue heavily influencing benefit provision is the work-life balance. Some companies are responding to employee pressure to provide a wider range of benefits that go beyond the traditional offerings to include childcare facilities, lifestyle management services, sabbatical leave and dental care.
Whatever the package on offer, the chances are that it will change over time. Employers must therefore review their benefit strategy regularly to ensure that it is competitive, supports the company culture, is aligned with business needs and meets employee aspirations.
While legislation dictates the things that must be provided as a minimum, this should not be used to determine how the benefits package is structured. Take stakeholder pensions: while it is important for employees to save for retirement, some may perceive other needs as more pressing in the short-term. Employees may decide to use other flexible tax-efficient savings vehicles to provide for their retirement, such as all-employee share plans and ISAs.
Whatever employees decide, it is important to establish their individual needs and for them to understand where their benefits fit into the total package.
Considering the amount of money employers spend on the non-salary parts of the benefits package, it is not surprising they want to ensure they get value for money. Research by William M Mercer indicates that employees underestimate the true value of their...
To continue reading
Request your trialCOPYRIGHT GALE, Cengage Learning. All rights reserved.
