Around £5 billion per year is being wasted on under-valued employee benefits that could be better paid as salary to younger members of staff, claims Adrian Humphreys of employee benefits administrator, WPA Protocol.
His observation follows a recent NOP World survey of 100 HR Directors/Managers amongst the top 1500 UK companies, which showed the majority (63%) of people within companies responsible for providing benefits, think that the impact of their benefits ‘offer’ on the career decisions of their junior employees, ranges from ambivalent, to not at all important.
In contrast, when asked to rank the importance of the benefits package to more experienced employees, 96% said the benefits package was either fairly or very important.
WPA Protocol says that these findings are a further nail in the coffin of the ‘one-size-fits-all’ universal benefits package and that savvy employers should be questioning the benefit, both to themselves and their existing/potential employees, of a standardised reward package. It says the research endorses that benefits need to be tailored, particularly for the highly skilled knowledge workers who will, in the next few years, form the bedrock of the UK economy. In particular, smaller, innovative companies are offering enhanced salary only packages, allowing employees to source their own portable benefits independently.
When asked which benefits they would consider cutting first if looking to reduce costs, just over a quarter of those polled said a company car, 14% said pensions and 11% said healthcare provision.
Adrian Humphreys, Chief Executive of WPA Protocol Plc, said: “Employers in the UK are at a cross-roads. Cost containment is key and with the cost of benefits escalating annually, switched-on employers are recognising the need to re-evaluate the way in which they remunerate their staff. The further we move towards a knowledge-based economy, the more important it will be for employers to know that they’ve got the right benefits package in place to motivate and retain good people.”
