How to choose the right employee benefits scheme in the UK
Employees are always demanding more employee benefits from their employers. But as business leaders, choosing the right employee benefits scheme in the UK can make the difference between a wasteful investment and one that boosts employee engagement, retention rate and productivity.
In this article by Pacific Prime UK, our employee benefits experts will take you through the three most important questions that will help you choose the right employee benefits scheme in the UK.
1. How old are your employees?
Different employee age groups will benefit from different employee benefits schemes. Implementing the wrong employee benefits scheme may actually do more harm than good. It can alienate your employees and make them feel unrewarded when a benefits scheme that is irrelevant to them is implemented. To prevent this from happening, let’s go through a few key examples that will help you choose the best employee benefits scheme for your company.
It is no surprise that the healthcare needs of older employees are far greater than those of younger employees. As the cost of healthcare and health insurance in the UK continue to rise, businesses have started to adopt the following employee benefits to help their employees ease the financial burden associated with healthcare costs.
Private health insurance
With the cost of private health insurance outpacing salary growth of employees in the UK, providing private health insurance coverage for employees is a highly valued benefit for older employees. This demand for better health insurance coverage in the UK is further fueled by the country’s struggling National Health Service (NHS), which experiences excruciatingly long queues and waiting lists throughout the year – especially in the year-end’s winter pressure.
In Pacific Prime’s latest 2019 report on the cost of international health insurance, the UK’s private health insurance premiums are the 8th most expensive of the 100 countries surveyed. With an average cost of USD $4,487, the UK saw its average cost of health insurance for individuals increase by up to 11% in 2019.
Retirement savings plans
Another financial issue that your veteran employees are facing is saving up for retirement. Many of them will be less than a decade away from retiring and they are starting to worry about saving up for retirement. Employee benefits schemes have evolved over the years to address this issue in the form of financial wellness programmes that include retirement saving programmes and seminars.
Ultimately, by easing the financial stress that your employees face, financial wellness programmes will help your business reduce costs. Studies have shown that financial wellness programmes can reduce healthcare costs by USD $270 per employee per year, and reduce costs associated with financial stress and absenteeism by USD $2,000 per employee per year.
Younger employees are not as worried about health-related issues as their older counterparts. This generational divide is reflected in the type of employee benefit that they value.
A 2018 survey found that millennials (born between 1981-1996) are more likely to prioritise paid vacation and overtime over health insurance when choosing an employer. As a result, a recent survey found that 2 in every 5 employees in the UK will fake a sick day if they needed to take a break from work. By providing more paid vacations, you will be able to develop a more honest relationship with your employees as they will no longer need to fake sick days throughout the year. This will, in turn, allow you to boost employee engagement at work and attract more talent to the company.
Career development programmes
Career development programmes are another employee benefit that has been proven to be effective in increasing engagement levels and retention rates among younger employees. For instance, LinkedIn’s 2018 Workplace Learning and Development Report found that up to 93% of surveyees stated that they are likely to stay at their current employer for longer if the employer invests in their long-term career development.
Young employees are ambitious individuals that are constantly looking for career advancement opportunities. For this reason, they tend to be more loyal to their employer when they feel like their employer is investing in their future career.
2. How stressful is your workplace?
Workplace stress is not only harmful to your employees, it’s also costly for your business. In the UK, the Labour Force Survey (LFS) found that in 2018, Britain faced a total of 15.4 million working days lost due to work-related stress. This amounted to a loss of GBP £13.5 million.
Employee Assistance Programmes (EAPs)
To reduce costs associated with workplace stress, employee benefits like EAPs have been shown to be effective ways to improve the wellbeing of your employees, helping them remain focused at work. The programmes can involve services such as therapeutic counselling, work-life balance seminars and an around-the-clock hotline.
From improved retention rates, increased productivity and lower absenteeism, a typical EAP will have a return on investment of USD $3 or more for every USD $1 invested in the programme, according to the Employee Assistance Trade Association.
Flexible working hours
Another cost-effective method of addressing the need to take more days off from younger employees is to implement flexible working hours in your office. This will allow employees to feel like they can work late on productive days and come into work late the next day. It will also give your employees the freedom to leave work early when they finish their tasks faster than usual.
This creates a natural reward system in your workplace that keeps employees productive and engaged throughout the day. A 2018 survey of 2,000 UK employees found that nearly three-quarters of respondents stated that they would be reluctant to leave their employer for another one that offers less flexibility when it came to working hours.
3. What are your business goals and budgets?
The final question you need to ask is what are you looking to get out of the employee benefits programmes? Whether you are aiming to attract and retain employees, improve your employees’ job performance and productivity, or lower the level of absenteeism will determine the type of employee benefits scheme that will be most suitable for your business.
From these goals, you can make data-driven decisions on what the most impactful and cost-effective employee benefits plan will be. Furthermore, your business goal and budget will determine the extensiveness of the employee benefits scheme as well as their period of implementation.
If you’d like to know more about choosing the right employee benefits in the UK, feel free to contact our experts at Pacific Prime to find the most cost-effective employee benefit plan in the country. As global health insurance brokers, Pacific Prime partners with employee benefits providers in the UK and the rest of the world to offer a wide range of plans for businesses of all sizes.
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