London, March 2, 2017

Only 4% of employers are giving staff a flexible allowance to spend on their wellbeing: those that do see a 23% uplift in engagement rates

Most employers are falling short when it comes to supporting their employees’ health and happiness, finds the latest Employee Benefits Watch report from Thomsons Online Benefits.

The report finds that employers are struggling to transform outdated approaches to benefits and fully support workers’ financial, physical and mental wellness. Over half of employees would prefer an allowance to support their wellness needs, but only 4% of UK employers are offering this and 76% are not even considering the approach.

However, for the first time improving employee health and wellness is one of the top three positive impacts employers want to see from their benefits programmes. HR professionals can take a pivotal role in reducing health pressures by transforming their benefits schemes; de-prioritising traditional benefits and taking a more holistic approach to achieving wellness in the organisation. However, at present only 15% of businesses are aligning their benefits with their people strategy, meaning there may not be a clear focus on these outcomes.

 

What do employees need and want?

The report, which surveyed 500 UK employees and 200 UK HR professionals with a total headcount of over two million employees, highlights that many employers are struggling to transform their wellness approach to offer the flexibility and personalisation that the modern workforce needs. This is leading to a significant disconnect between the benefits employers are offering, and those employees want.

  • 90% of employers offer group life cover, yet only 5% fund initiatives to support wellbeing
  • 65% of employees want broad financial support; only 7% of employers currently offer it
  • 70% want income protection but only 35% offer this

The report finds that employers are struggling to transform their wellness approach to focus on prevention rather than cure. They are continuing to offer traditional, out of the box solutions, rather than the flexible benefits that will empower employees to make the positive lifestyle choices critical for maintaining good health. By comparison, employers forging ahead in the wellness space are taking a more holistic approach - driven by a combination of changing lifestyles and the development of technology.

Jean-Christophe Fonfreyde, Head of Reward at Wellcome Trust, explains: “At Wellcome we support employees across four wellness pillars –  physical, mental, financial and environmental.  Our approach covers every stage of employee wellness, from prevention to detection to rehabilitation, and understands that all are inextricably linked. Financial worries, for example, may have an adverse effect on an employee’s mental and physical health.

“Taking a connected approach to wellness is vital in addressing the root causes of problems, as well as symptoms. This is why at Wellcome, we aim to provide a range of benefits to meet the commitments of our wellness pillars, such as an on-site gym and access to a nutritionist, pension clinics and a network of Mental Health First Aiders.”

Matthew Gregson, ‎SVP, Data & Analytics at Thomsons Online Benefits continues; “Employers that offer the latest in wellness support will have around three times as many employees who are extremely engaged in their company. These employees will perform better, and make a greater contribution to business productivity. Therefore, aligning benefits strategy with people strategy is an absolutely critical step in giving the right package to employees and getting the most back from them.”

 

What’s the role of communications and technology?

“But it’s not just all about benefits design,” continues Gregson. “HR departments cannot forget the value of continuous communications and technology in empowering employees to get the most out of their benefits programmes. Timely, relevant communications and offering wellness tools and services via an online platform are both essential in driving engagement and achieving the best outcomes for all.”

“Analytics is also enabling HR departments to explore how their employees are behaving towards their benefits and measuring the impact of their wellness initiatives, adapting their approach as necessary. Those that are harnessing technology are reaping the rewards, being almost twice as likely to be very effective in meeting their benefits engagement objectives. Even so, less than half of companies are using technology to deliver benefits to employees, missing a key opportunity to increase engagement,” concluded Gregson.

Benefits communication is another area where Thomsons’ research reveals clear room for improvement. Two thirds of employees are keen to hear about relevant benefits at life milestones such as marriage or childbirth, but only 24% of employers are taking advantage of this.re similarly shy of the mark when it comes to communication methods. Two thirds (66%) of employees would like to receive digital communication on their benefits, but only 50% of employers prioritise this channel. This is concerning as digital communications, such as e-mails, provide click-through rates, enabling HR teams to measure their communications effectiveness. Meanwhile, organisations that use mobile apps to provide access and to share benefits communications, experience around six times as many very or extremely engaged employees – 20% compared to 3% in organisations choosing not to use mobile applications.

 

How will transforming wellness improve engagement?

Over 80% of employers cite improved employee engagement as the number one positive impact they’d like to see from their benefits programme, and taking a transformational approach to wellness can play a pivotal role in achieving this. Those employers already offering wellness pots see an average 23% uplift in engagement rates – a result likely to carry through to employee performance, client satisfaction and business productivity.

For more information on the latest trends in wellness, download our Employee Benefits Watch here.

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About Thomsons Online Benefits

Thomsons Online Benefits is a SaaS provider of global employee benefits and employee engagement software. It is a wholly owned subsidiary of Mercer, a global consulting leader in advancing health, wealth and career. Mercer is a wholly owned subsidiary of Marsh & McLennan Companies (NYSE: MMC). Thomsons' award-winning platform, Darwin™, is the global market leader for automated employee benefits administration. With over 1 million worldwide users, Darwin™ connects employees with their benefits in over 86 countries and 24 languages. By using the right combination of editions, Darwin™ provides a tailored solution to meet a variety of employee benefit and reward needs, including employee engagement, managing risk, controlling costs and streamlining benefits administration. Its ability to constantly evolve and cater for shifting workforce needs has made it the provider of choice for seven of the world’s top ten technology companies. Thomsons has received 105 industry awards, including the prestigious Brandon Hall Group gold award for Best Advance in Rewards and Recognition Technology in 2015. Mercer and Thomsons combine world class consulting and broking with innovative technology that is driving transformation in the way that benefits are designed, communicated and administered.

 

About the research

Employee Benefits Watch surveyed around 200 HR and reward professionals and 500 employees in the UK covering a headcount of nearly two million to compare their respective views on benefits and assess whether, in their current form, they are still fit for purpose.