As we enter 2017, HR and reward professionals are finding themselves at a crossroads when it comes to defining their benefits strategy, with almost half of businesses seeking to improve theirs this year. This is unsurprising considering recent, radical shifts in the benefits and business landscape. While the fallout of the Brexit vote is still to be defined, interest rates are likely to remain suppressed for the next decade, meaning insurances and pensions liabilities risk becoming ever costlier. Meanwhile, tax relief continues to be eroded, with changes to salary sacrifice and the new childcare tax relief scheme coming into effect this year.
Benefits strategies will increasingly need to reflect these changes as employers look to remove cost and risk from their programmes through the coming year. However, if employees continue to place a high priority on costly benefits, such as defined healthcare, employers are in danger of eroding the value of benefits for employees. To meet the needs of both the business and their people, the fundamental design of benefits programmes will have to change.
While cost and compliance are primary concerns for HR and reward teams, according to our recent Future of Financial Wellness report, the top three factors that influence employees’ perception of their benefits are relevance (43%), ease of access (49%) and communications (58%). These should lie at the heart of your benefits strategy, and the following five steps will help guide your approach.
1. Set a strategy that is fit for purpose
Our research shows that 80% of employers feel their benefits strategy isn’t aligned to their business strategy – yet this is a key factor to help ensure your benefits are effective. To gain greater alignment, you first need to consider your organisation’s business objectives andthink about what your employees need to better meet these. Would a healthier lifestyle make them more productive for example? Would a flexible working scheme better support working parents?
Once your goals are set, articulate your vision. Remember that your employees are the best sounding board. Requesting their feedback and acting on this will serve to improve your offering and increase their engagement in your programme.
2. Evolve your approach to wellness
Employers have a duty of care to address all aspects of employee wellness; physical, mental, financial and social. But many workforces need greater support in some areas than others.
When working out wellness priorities, it’s helpful to look at the dominant demographics in your workforce and think about the wellness benefits your employees will appreciate. Then use initiatives such as webinars or events to drip-feed information to employees on a regular basis, before measuring the effectiveness of your activity and tweaking if required.
3. Offer personalised benefits
True personalisation depends on empowering employees to select their own benefits using your funding. This ‘beyond-flex’ approach enables your strategy to align perfectly with employees individual wants and needs. For example, some people may want to join a running club, others a Zumba class – but supporting either approach will further a flexible wellness agenda.
Look at the funding you have available and how you’d like employees to access this. Having a system in place that enables employees to choose their own benefits empowers them, while highlighting the financial value of their benefits through an online total reward statement.
4. Communicating the value
Our research shows that employees want more communications more frequently and across more channels. But to avoid spamming employees, you need to ensure communications are relevant. Start by segmenting your workforce by demographic or different life stages.
Think of your communications as your marketing engine. Moving to a multi-channel approach will broaden and improve your reach, while having clear calls to action will encourage employees to engage and improve benefits take up.
5. Remove barriers to create a truly convenient experience
Finally, remember the importance of ease and access. In a world where you can order a taxi or takeaway in a matter of minutes, employees simply won’t engage with a process that isn’t accessible, quick and intuitive. Having the right online platform in place will provide a convenient experience for employees, encouraging them to interact more frequently with their benefits. Making this experience mobile will enable them to access benefits at any time in any place – giving them even less reason to check out.
The key takeaway from this is that, despite the uncertain business landscape, HR and reward professionals have reason to be cheerful. While making big, strategic changes to benefits provision may seem daunting, improvements in technology mean that you now have the tools at your fingertips to ensure the solution you choose meets organisational and employee needs – while reducing costs for the business.
If you are interested in finding more tips to strengthen your benefits programme, why not watch this webinar recording ‘How do you design a benefits scheme that stands the test of time?’.