As an employer you offer pay and benefits to employees to entice employees to join your company and then to retain your employees.
Traditionally salaries were used to attract people to a role and benefits helped to retain them, and bonus and incentive schemes motivated employees to perform at their best. However, the way in which employers and employees think about reward has changed.
Individuals come, stay, and perform due to a range of financial and non-financial rewards, which can change over time depending on personal circumstances. In some situations, individuals may not consider the financial elements of a package that important. For instance, people at the beginning of their career may be more interested in gaining access to training and career development. Similarly, individuals may be willing to work for lower pay rates (or even volunteer) if they have a strong attachment to an organisation’s purpose.
Employers should find out what attracts, keeps, and inspires their current and future people, and explore how best they can meet these needs – as well as meet the requirements of the business within the appropriate legal and regulatory environment. When creating a reward package, it’s also important that organisations integrate the various reward elements so that they support, rather than contradict, one another, such as the factors used to increase pay and give bonuses.
Types of Benefit
Many employers offer a wide range of benefits, from traditional items such as bonus, salary increase and enhanced statutory entitlements for example increased annual leave or enhance maternity leave, however things have changed, and employers need to do much more to retain and attract the best and most talented employees. This includes both pay and benefits collectively. Some benefits employers may offer:
- Profit share
- Company car
- Income protection
- Death in service
- Benefit platform – providing employee perks and engagement apps.
- Private healthcare
- Hybrid or home working
- Recognition – team-based events, employee of the month, pizza Friday
- Lunch time finish on a Friday in the summer
- Volunteering days
When looking at benefits, you may wish to consider salary sacrifice. This will provide tax relief to your employees and enable them to tailor the benefits that suit them best at that point in their life. This allows the employee the option to pick and choose any benefits that they would like to benefit from. Some examples of benefits that you may wish to consider for salary sacrifice are:
- Cycle to work
- Electric vehicle purchase
- Childcare vouchers
- Private health care
- Dental health plan
- Additional employee pension contributions
- Gym membership
- Mobile phones, laptops, and other technology
- Buy additional annual leave
This is not an exhaustive list of benefits, please contact us directly to discuss your individual needs.
Contractual and non-contractual benefits
All benefits need to be clearly identified as either contractual or non-contractual to avoid any confusion, Non-contractual benefits are discretionary and can be withdrawn at any time without consultation.
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