Could flexible benefits help your business?
Flexible benefits are increasingly seen as the best way to attract and retain the kind of staff a business needs, while keeping them engaged and motivated. At the same time, many UK companies are confused about what flexible benefits are and whether the cost of introducing them would be worthwhile.
What are flexible benefits?
Flexible benefits are optional in-work benefits that your employees can choose to take up, usually in return for a small cut in their take-home pay, known as ‘salary sacrifice’. Because this is taken directly from their salary before deductions, they also pay less income tax and national insurance as a result. The savings in employer’s contributions towards NI can help pay for the benefits, so they are often worth more than the amount given up.
Examples of flexible benefits include childcare vouchers, gym membership, a company car or bicycle, private medical insurance and so on. Individual employees can choose the one(s) that will most benefit them. Generally, these can be changed or renewed every 12 months, barring major life events such as marriage, retirement or the birth of a child.
What are the advantages of flexible benefits?
Employees choose from a variety of benefits that will improve their work/life balance at a lower cost than paying for them directly. Employers benefit because an attractive flex package helps with recruiting and retaining staff, especially in industries where there is a distinct skills shortage.
A flexible benefits scheme is people-focussed and recognises the diversity of needs among the workforce. It reinforces the idea of the workplace as a team, with the employer looking after its staff. Plus it improves motivation and employee engagement as a result. This should, in turn, increase productivity and reduce absence.
Read more: Financial wellbeing in the workplace: a guide for employers
How do flexible benefits work?
When establishing a scheme, you should consult your staff about the benefits they would like to see included. Alan Boswell Group can help you identify the best benefits package for your business and make sure that it’s cost-effective and compliant with current tax regulations and employment law.
The administration of a benefits package can be streamlined by using software, but an initial feasibility study is essential. A scheme can take anything from three months to a year to set up. Once the scheme is in place, it is necessary to monitor take-up and to continue to consult staff about its effectiveness.
A flexible benefit scheme if run well can be a great benefit to all concerned. Talk to us today about how we can help your business get started today.
Read more: 10 ways employee benefits can help with the cost of living
