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Benefits in kind don’t cut it

Increasingly, as economic conditions dictate employers are seeking alternative ways to incentivise and reward staff. The benefits need to be right for the workforce but also the communication needs to be right too. By David Walker Commercial Director, Personal Group.

Over the last few years, employee benefits have shifted from being unusual and attractive to a basic expectation. The fact that “entitlement by staff” regularly features in the top half of reasons why companies offer schemes bears this out.

It is worth considering whether you are going to start a standalone voluntary benefits scheme or if you will incorporate it into a wider employee engagement programme. This could include, for example, career mapping or health and wellbeing programmes. In terms of deciding ‘when’ to introduce a benefits programme, a more challenging consideration for HR Directors is that at any point there will be some strategic or wider issues that would justify deferment, such as reorganisation or pensions auto-enrolment.

HR Directors might think there are better times than others to get programmes up and running and it is tempting to put plans on the back burner until those bigger projects are resolved. However, smart organisations wouldn’t defer programmes for external reasons. If you don’t have a scheme in place your competitors will, so there is a risk that by deferring or waiting you could make staff less engaged than they already are. In every situation, the key to a successful programme is communication and ensuring your employees understand your message. You need to explain very clearly why the company has chosen this route and how the employee will benefit. You will need to explain the benefits, get employees registered and encourage them to actually use the programme. A scheme will only become integral if the staff are regularly using it; usage should be your end goal. If you can achieve this, staff will become advocates and influence others internally, and it is this that makes a programme successful. You may have the best programme possible but if no one knows about it or no one uses it, it has no value.

How you communicate with your staff is extremely important, and it’s useful to remember that online isn’t the only option. In a technological age, few take the time to actually talk to employees to ask how they would like to hear about their benefits.

Face-to-face remains the most effective form of communication and whilst it can be seen as time consuming, it is very worthwhile, particularly if it is the first time you have put a benefit package in place. It allows your employees to ask direct questions which they may not wish to ask in front of their peers, and it aids understanding. Face-to-face meetings can also be used to register staff and get them up and running on the programme. Numerous case studies have shown that companies who have invested heavily in a benefits scheme can achieve high levels of awareness but levels of registration and usage are often much lower. Something happens between the message being sent out and action being taken.

One of the main issues is that to use benefits to the maximum effect requires a change in behaviour. While employees may receive benefits, they need to be encouraged and motivated to use the benefits packages available to them. A small change in behaviour is all that is required in many cases, and there is a lot of value in allocating specific time to explain benefits and encourage some forward planning because it can result in significant financial savings. A mixture of online and offline communication is often the best way of encouraging these changes. For example, by changing spending habits and using a re-loadable payment card with a five percent discount available for the weekly shop, the average household can save £138 per year*. In fact, if all relevant employee benefits are fully utilised, the average household can save around £1400 per year*. To put this into perspective the average earnings for a full time worker in the UK is £26,500**, therefore applying employee benefit savings is the equivalent to 5.3 percent increase in salary. Of course, this requires effort but in a climate of pay freezes, an effective five percent increase in salary can be very attractive.

Technology is a great way to communicate benefits but it is best practice to first assess how employees use and access technology in their personal and professional lives. Emails may be a good communication tool for office based staff and social media can also help spread the word when it comes to a new benefit. Equally, if technology isn’t widely used, a well-placed poster or flyer might be just as effective. Each company is different and you need to communicate in the way that works best for your team. If you communicate well, and educate well, you have a much better chance of developing a loyal and engaged workforce.

David Walker Commercial Director
Personal Group.

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