How to create a standout employee benefits package

What are employee benefits?

Employee benefits can most easily be defined as anything an employee receives from their employer outside of pay. Employee benefits can help you to stand out as an employer. It is a delicate balance to strike between selecting benefits that are both affordable and appropriate for your organisation that employees truly want to use. As employers assess whether their current approach is working, being able to understand and explain the range of benefits on offer accurately and succinctly is crucial to delivering value to employees. Success lies in the communication.

Employee benefits at work

When it comes to defining best practice towards company benefits at work, when assessing the range of benefits on offer, employers should take the opportunity to understand the measures that generate the greatest employee engagement. Ensuring the benefits on offer are what employees actually want and use is a good starting point to refine and adjust the package on offer. Monitoring take-up rates of each benefit is a good place to start. Take the opportunity to assess whether employees are aware of the benefits available to them.

At Paydata, we believe that fair pay is a hurdle each organisation must overcome to unlock the engagement potential of the wider benefits on offer. Salary benchmarking helps employers ensure they are paying competitively for the role and sector, enabling HR to factor in experience, education, skills and location to pay calculations.

Organisations should review whether they are truly receiving the best value for their investment in the benefits provision they receive from any service, partner or broker they are working with. Deb recommended that the employee benefits package and provider should be reviewed every two years on average given the size of the task.

Innovation vs trends

Innovations and trends are two very different concepts – from unique and special things companies do to standout as an employer, to measures that reflect what everyone else is doing. Over time, a trend may become embedded and part of the HR landscape.

“At the early stage of a trend, you might feel quite quickly, actually this is not for me, this might be something happening in the industry but it’s not for my organisation; or actually, you might feel that it is part of your aspirations to exceed that trend.”

Deb Brooks, Employee Benefits Consultant

Examples of company benefits range from those that are truly innovative to those who are embracing key trends. Innovative approaches can be achieved through offering company products to staff for free or at a discount. Cook provides a 30 per cent discount and Charlie Bingham also provides their food to staff. Similarly, Bupa provides primary care access for those working in care homes and dental practices. Experiencing the product or service builds employee loyalty and pride, driving forward employee engagement directly by building affinity with the brand and what it has to offer.

Being ahead of the curve in terms of identifying additional support employees require as individuals is invaluable. Fertility treatment support, menopause support and free period products are all measures designed to help the individual and their milestones in life. Crises support such as domestic violence protection, pet rescue and miscarriage and baby loss support are also offered by some employers. Innovations around learning and development are also important to employees, with Monzo bank offering £1,000 per annum towards books, training courses and conferences, all designed to progress employees.

Key trends in employee benefits

Employee benefits trends are holistic in nature – covering a range of financial, physical and wellbeing support. Many organisations are funding healthcare cash plans and offering access to virtual GPs is extremely popular. There is a focus on sustainability with cycle to work schemes and electric vehicle schemes which is an opportunity for employers to offer benefits that directly reflect their values. With volunteers being widely required, an organisation can live its values by supporting employees to give up their time to volunteer or even become trustees of charities. Employees can also donate as they earn for selected charities.

Remote working was adopted by all organisations who could offer working from home arrangements during the pandemic. However, many companies are now encouraging employees to come back into the work premises more regularly. Organisations are seeing value in promoting their culture and values in the office together, generating more ideas and more cohesive teams.

Hybrid working is one way of enabling teams to consistently meet face to face while giving employees the freedom to work from the comfort of their own home. The recent four day working week trial demonstrates how productivity can be maintained and shows how this will suit certain companies. This also boosts the company’s sustainability credentials by cutting commuting and reducing emissions.

Employers trying to support employees through the cost of living crisis include those who are relaunching their benefits package to ensure employees are aware of the entirety of benefits available to them, providing greater communication around the range of benefits on offer. 72 per cent of respondents to our UK Reward Management Survey offer discounts on high street products and services to reduce rising costs for staff. Webinars around financial education and planning are increasingly common. More recently, out of the 237 respondents to our January Pulse Survey, 33 per cent are considering paying a lump sum non-consolidated payment in 2023, with £500 being the median amount.

Transform your employment benefits

A very powerful approach is to give employees flexibility when it comes to defining their own employee benefits package. During the webinar, we carried out a poll asking attendees about their key priorities in terms of employment benefits, garnering 118 responses. Providing cost of living support appeared highest on the priority list, in recognition of individuals facing the challenge of rising costs.

The second highest priority for benefits was the additional annual holiday entitlement. Extra birthday days and moving house days generate goodwill. Others have transformed their annual leave policy. Traditionally described as a set number of days of holiday entitlement to recharge, some employers are saying that the total number of days of annual leave includes bank holidays that employees can take whenever they like. This relatively simple approach recognises that not everyone celebrates Easter etc., so the policy is flexible and inclusive, giving employees far more choice and generating greater engagement.

The third highest priority was green car leasing – highlighting the importance of sustainability and values-led benefits. Healthcare cash plans also remain popular, given their wide remit and the harnessing of technology to make accessing GP services easy and efficiently. This was closely followed by private medical insurance given the pressures facing the NHS.

Consider wider culture

The employee value proposition and what a company promises its people compared to what it actually delivers, can be directly reflected in benefits packages. The resulting employee experience is a vital tool to drive employee engagement, going beyond the traditional benefits on offer. Giving ownership to people about their work and mapping career development drives employee motivation and loyalty.

Benefits can support this wider employee experience, with the offer of hybrid working giving people the flexibility sought by many employees. Many values-led benefits such as volunteering could also double as team building days, as the company shows its values in action with each team. It is important to recognise that the sum of benefits may vary for each and every company to accommodate different cultures and priorities.

What defines excellent benefits?

A system that accommodates what matters to employees can be achieved by trial and error. Employee benefits must be affordable for organisations, so make sure that resources are being invested in the right initiatives and do not overlap – for example Employee Assistance Programmes may overlap with similar initiatives.

For those not in a position to spend, look at the current benefits on offer and communicate these to employees. Consider what is already available that might help, for example discounts available from supermarkets through employers and salary sacrifice benefits.

Total Reward Statements are an excellent way to capture what is already being offered to employees, outlining the true value that employers are offering through tangible and intangible benefits. The pension is the biggest cost on your employee benefits balance sheet and is one of the most overlooked. Consider whether it is truly providing value that is understood by employees, which Total Reward Statements can outline at a glance, alongside other more creative benefits.

Get in touch

Talk to us today about your approach to benefits and whether you are maximising the impact that your total reward package is making as a result. With more than 160 attendees and great engagement during our ‘Employee Benefits – current innovations and trends’ webinar, we are looking to run a follow up discussion group on this topical subject – register your interest to receive updates and join our next webinar.