A – Z of voluntary benefits

 

Voluntary benefits have changed rapidly over the past 15 years, as benefits that employees would have traditionally bought for themselves are now more readily available.

There has been a change in what is included in workplace benefits, and also how they are offered. The traditional offerings may still be there, but the real growth has been in a different type of proposition – the voluntary benefit, which fall into two broad categories:

  • Extra benefits in a package that the employee may contribute towards;
  • Discount set-up where the individual receives some form of reward as a result of making a purchase.

The huge advantages of this type of benefit is that it offers massive choice for the staff member at a minimal cost to their employer.

Kimberley Dondo of Reward has looked at the available options and compiled an A-Z list of what employers can consider.

ANNUAL LEAVE TRADING: Annual leave trading allows employees to purchase more days or sell unwanted holiday time. It’s a fantastic scheme to offer where employers want to give employees a good work-life balance, and it’s great for morale, retention and recruitment. “Purchase-only schemes can also generate substantial financial savings for employers and, as it’s a salary sacrifice scheme, the employee can also save some tax and National Insurance on any annual leave they purchase as well,” says Julian Foster, managing director at Computershare Salary Extras.

BIKES: The cycle-to-work scheme allows employees to choose a bike, hire it for a certain amount of time and buy it for a fraction of the price. Since it a full salary-sacrifice scheme, employees can either save 32% or 42% on the cost of a bike and the necessary equipment. It is available in more than 2,000 retailers nationwide all year with interest-free credit.

CARS; As motoring costs soar, an HMRC-approved car salary sacrifice scheme can be an affordable way for staff to have a new car. By choosing low or zero emission vehicles, employees can take advantage of the tax relief and get behind the wheel with affordable monthly repayments. Plus, the employee usually gets all their running costs included in the monthly repayment – insurance, servicing, road tax, replacement tyres, maintenance, breakdown cover.

DISCOUNTS AND OFFERS: This voluntary benefit covers a vast array of discount-related vouchers, such as high street shopping, travel and restaurants. This type of benefit especially suits a diverse workforce and as long as the discounts are relevant, accessible and well-advertised, discounts can generate large savings.

EMPLOYEE ASSISTANCE PROGRAMME: Employee assistance programmes support employees in dealing with personal problems that may have an adverse impact on their work, health or wellbeing. Depending on the level of cover that an employer selects, EAPs are free for the employees to use. EAPs are growing quickly as they work both economically and socially.

FLEXIBLE WORKING: Employees with a flexible work schedule have been proven to be far more productive and healthy. Flexible work schedules can help people meet family needs, personal obligations and other responsibilities more conveniently, and help increase their feeling of personal control over their work environment. All staff have the legal right to request flexible working.

GYM: Discounted or free gym membership is popular and helps to improve physical and mental wellbeing. Recently companies have reinvented the model by offering membership for classes at different gyms in different locations.

HEALTHCARE: The need for support with everyday healthcare costs has been increasing. Services like Health Shield’s voluntary corporate plan offer access to an online portal (mywellness) that allows members to have access to a virtual GP surgery, private prescriptions, 24/7 counselling and support helpline, online health assessments, cancer screening and physiotherapy triage.

INCOME TAX SAVINGS: Staff members can save on income tax with some employee benefits. For example, with cycle-to-work and childcare voucher schemes, any deductions are taken from gross salary, which reduces the amount of income tax an employee pays.

JUSTIFICATION FOR BENEFITS: A wide-ranging benefits package will support a productive workforce and help to attract and retain employees, which will ultimately reduce recruitment and training costs. “If an employee can make their net earnings go 2-3% further in purchasing power then this is a win for the employer,” says Marcus Underhill, director of engagement and insights at Staffcare.

KIDS’ PASS: Kids’ Pass offers staff discounts to child-friendly entertainment during the school holidays. Membership supplies access to more than 5,000 attractions, including 1,600 family friendly restaurants, 450 cinema locations and a wide range of family holiday discounts with companies such as Eurocamp, Cottages.com, Butlin’s and Hoseasons.

LIFE ASSURANCE: Life assurance is a type of insurance contract that offers a lump sum to your dependants should you die while under contract of employment. Many companies will allow increased levels on a voluntary basis and deduct the cost from gross monthly salary. This can be an  extremely valuable benefit, particularly where there is a young family or if an income is lost.

QUICK WINS: “By consolidating all your benefits in one central location, it’s easier and quicker to promote new benefits, employee visibility is improved and administration is kept to a minimum – making it a quick win all round for both employer and employee,” says Computershare’s Julian Foster.

RETAIL DISCOUNTS: Prices are rising faster than wages, and employees are continuously looking for ways to stretch their money further. A retail discounts scheme enables employees to access savings not normally available on the high street and this can include many of the leading retailers. A good retail discounts scheme enables employees to make savings on everyday essentials in addition to special one-off purchases, and includes travel and days out.

SHARE PLANS: Research carried out by the National Institute of Economic and Social Research, the London School of Economics and Computershare found that employees who take part in a company share plan are absent less often, are less likely to leave the firm, and work longer hours, as well as having more job satisfaction.

TRAVEL LOANS: For those who travel to work using public transport, the cost of an annual season ticket can be much better value than paying daily or monthly. However, for most people this involves the expensive options of using a credit card or taking out a loan. In-house travel loans enable staff to borrow the cost cheaply, with repayments taken in 12 equal instalments directly from their pay.

UNRESTRICTED WINDOWS: Unrestricted benefits windows allow true flexibility by offering ‘any time’ benefits. This helps employers to ensure that they see maximum uptake of the benefits they provide, which in turn allows for a decent return on investment.

VOUCHERS: By April 2018, parents will no longer be able to register for childcare vouchers following the full introduction of the government’s new tax-free childcare system. However, parents registering before the cut-off date can continue to receive childcare vouchers until their children are 15, delivering an annual family saving of up to £1,866 – or the best part of £28,000 over 15 years.

WELLBEING: Mental health is a growing area of focus by many employers, who can address their duty of care by giving staff access to benefits ranging from providing fruit and other healthy snacks in the office to weekly 30-minute massages.

XTRAS: As most contracts with benefits providers can start from one to three years, feel free to ask them what else they can provide, or negotiate better discounts over the term of agreement.

YEARLY REVIEWS: It is important to review the benefits staff have most engaged with. It is also important to ask your workforce which benefits they used and which ones they feel are missing from what you provide.

ZZZZZ: With employees living fast-paced, high-stress lives, a lack of sleep can be a issue. Some employers have installed sleep pods or have a comfortable couch in a room so staff can take a quick nap. A study by the American Academy of Sleep Medicine found that well-rested workers are more productive, miss fewer days due to illness and could save a business up to $4,261 per employee.

As an independent employee benefits intermediary advo can guide you to the most appropriate benefits package. You can contact advo here.

 

You can see the original article first published in Reward here.

 
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