Not everyone is motivated by the same things, and when it comes to staff benefits it’s important to make sure that you’ve got something for everyone.
Employers are increasingly offering flexible benefits packages, giving each person a budget, often around £500, and allowing them to choose what they want, be it gym membership or an adult learning course, or offering a range of options so staff can choose what’s best for them. But money is not the only motivator and an attractive benefits package doesn’t have to cost you the earth. Here are a few ideas.
Share options
Once used on a discretionary basis as a share incentive scheme for executives, many companies now extend share ownership to all employees, and it is an increasingly popular option. In fact, the government encourages share ownership with the HM Revenue & Customs approved Share Incentive Plan (SIP) and the Save As You Earn (SAYE) share option scheme, which offer employees discounted or free shares up to a value of £9,000 per year for three to five years. A word of caution however: under relatively new regulations, companies are required to value their employee share options and include them in their accounts.
Time off
Free time is arguably the most valuable gift an employer can give. Whether in the form of extra annual leave or being able to leave early every so often when targets are hit, additional time off is a relatively low-cost perk which will be well worth it for the boost it will give to morale.The ability to buy and sell annual leave has also been around for some time, although many employers have been slow to take it up. A typical holiday policy allows the purchase or sale of between three and five days a year. The price of each day of leave is usually a set formula of salary based on the normal number of working days. Deductions are made from gross pay under a suitable salary sacrifice arrangement.
Pensions
Pension schemes are a highly popular choice. By 2012 all companies will have to offer some sort of arrangement for their staff, either privately or through the incoming personal accounts scheme, and provide a minimum contribution. There are many different pension schemes available so it’s worth doing your homework to find the one which is best for your business. Following the pension reforms, many employees have been seeking financial advice and employers can also arrange for this to be provided as a benefit, either free of charge or on a subsidised basis.
Cycle schemes
In a drive to make staff healthier, employers can team up with suppliers to provide bicycles for staff to travel to and from work. As long as no staff are excluded by the policy, there is generally no taxable benefit.
Vouchers
Employees can be issued with a discount card that is topped up with monetary value from their net pay each month. The card is used like a debit card in retail outlets. Many retailers (including major high street stores and online companies) will offer discounts of up to 15% for using the card. The discount is provided automatically at the point of sale or by adding credits to the card.
Top-ups
Recently there has been an increase in the availability of some benefits for purchase by all staff through voluntary schemes. Employees can buy additional life assurance, critical illness cover, medical or dental insurance offered by their employer at discounted rates, and often with less stringent underwriting terms.
Others
There are many other options worth looking into. These include profit-sharing, company holidays for top performers, monthly and annual awards, flexible working arrangements and childcare vouchers to help retain working parents, season ticket loans for commuters or company cars and even the provision of tea, coffee and fresh fruit. The best way to find out what benefits your staff really want is to ask them.
© Crimson Business Ltd. 2009