Future-proofing your employee benefits scheme
“Think of a corporate benefit programme as part of the foundation of a house. If it’s not in place in the correct way, the house may become unstable,” says Debra Corey, co-author of “Build It: The Rebel Playbook for Employee Engagement”.
Corey, who also has over 20 years of experience as a rewards leader and recently presented at the 2019 Lockton Global Benefits Forum in London, suggests a strategic approach to the design of a corporate benefits offering.
A frequent mistake companies make is to include in the offering what they think is right without aligning it with an overarching strategy, Corey explains.
“The strategy needs to reflect the key objectives for employee benefits,” Corey says.
A company’s strategy can revolve around the principle of including benefits that are competitive and therefore in-line with market practice. Alternatively, the strategy may reflect the company’s values or just be compliant and in-line with legislation.
“If the strategy includes the principle of treating all employees equally but then top managers are offered company cars, this does not work,” Corey explains. “The company needs to be able to explain and also justify why certain benefits are offered and sometimes are removed from the programme,” she notes.
If the strategy includes the principle of treating all employees equally but then top managers are offered company cars, this does not work.”
Corey suggests a three step process for developing your benefits strategy and offerings. It starts with an analysis that includes the benefits that are offered on the market, the various interests and needs of employees as well as prospects. It also includes researching the interests and needs of your workforce and developing your overarching benefit objectives.
In a second step, the elements of the benefits programme are selected and tested against the objectives you developed in the previous step.
Finally, the company needs to communicate the benefits offering and the objectives of the scheme to employees in a meaningful and effective way.
In the past, the objectives of benefit schemes mainly focused on being competitive, compliant, cost-effective and culturally aligned. While the first three principles are increasingly seen as a given, the focus moves towards making the programme more culturally aligned and, as a result, unique. Subsequently, the benefits programme may need to be reviewed more frequently. While in the past it was sufficient to review the offering every three to five years, a more progressive benefit scheme may need to be reviewed every year to remain aligned with your objectives and right for your ever changing workforce. Each update will involve removing elements that are unpopular or no longer aligned with the strategy and introducing new ones.
This process and any changes to the programme will need to be clearly communicated and explained to employees.
A more progressive approach may, for example, involve a flexible use of public holidays if it turns out that this option suits some employees better. Or the company may offer to help employees to pay off their debt such as student loans.
While the value of a diverse workforce for businesses in terms of innovation, creativity, talent retention and customer relations are widely appreciated, reaping its advantages requires an inclusive environment where the benefits scheme plays an important role.
“The best organisations take time to analyse the demographics of their workforce and get to grips with diversity of their needs and interests before selecting the benefits they want to offer,” says Chris Rofe, Senior Vice President Employee Benefits at Lockton.
The analysis can reveal unorthodox and innovative new benefit options that can give the company a competitive advantage by increasing the level of engagement between the employer and its staff.
For more information please contact:
Chris Rofe, Senior Vice President, Employee Benefits
+44 (0)207 933 2876