Annie Hayes, HR Zone Editor spoke to Melanie Guy, HR Manager for software services outfit, Snowdrop to find out the reasons why they decided to revisit their benefits package and make some dramatic changes.
- Pension with contribution from Snowdrop.
- BUPA healthcare cover.
- BUPA dental care.
- Sight test vouchers with discounts on spectacles and sunglasses.
- Occupational maternity, adoption and paternity pay.
- Childcare voucher scheme.
- Holiday entitlement based on length of service.
- Flexible working day between 07.30 – 18.30.
- Free stress helpline.
- Free lunchtime and evening training courses.
- Voluntary benefit discounts as arranged with local suppliers.
- Non-fiscal rewards for high achievers.
Most popular benefit: BUPA dental care scheme.
Most unpopular benefit: Qualifying period for BUPA healthcare cover which has now been changed.
- Speak to employees and get them involved in structuring your benefits package.
Following some in depth workshops held last year Snowdrop, the software services provider decided it was time to revisit their benefits package and take action accordingly. The business which was founded in 1991 now has 135 staff located in Witney, Oxfordshire, Glasgow, Hampshire and Barcelona and as a growing operation needed to ensure its rewards package was in line with the competition.
Melanie Guy, HR Manager for the business told me that following the decision to review the package they decided that the most important objective was to offer benefits that would really reward everyone whilst at the same time ensuring that the costs for Snowdrop were manageable.
They looked at a number of flexible benefits schemes but found that they were all geared towards companies of over 1000 employees where the employer had the advantage of negotiating a lower price for a number of different benefits, a luxury the business didn’t have with its current size. They therefore began to consider which benefits would actually ‘benefit’ each and every employee as well as providing a significant saving every year.
Kick-starting the suite of benefits on offer is the contributory pension scheme. “We wanted to make it attractive and fair to everyone regardless of their earnings so we decided on a flat employer contribution of £50.00 per month, provided the employee contributes a minimum of £25.00 per month.”
Most schemes are based on a percentage of salary but this scheme allows everyone to save in an equitable fashion. Employees are eligible to join after one year’s service and employees can also select to contribute above the £25.00 minimum requirement.
BUPA healthcare has also been incredibly popular and even more so since the qualifying period was reduced from one year’s service to just three months.
Employees can also include their families and although their costs are not covered by the company the administration is handled by Snowdrop.
But even more popular then the healthcare scheme has been the dental cash-back plan. “This is a Cash Plan so it means that you get actual cash back for each treatment you pay for at any dentist. This policy can therefore be worth up to £800 a year on routine treatments and £5,600 for emergencies and accidents/injuries,” says Guy. And again employees can add family and benefit from having a centrally administered scheme. Guy believes that the popularity of this benefit has been the lack of available NHS dental practices in the area making any dentistry plan valuable.
Sight test vouchers are also on offer supplied via Specsavers. Employees can take advantage of reimbursed sight tests, plus £40 towards the costs of prescription glasses. “An employee was just telling me how pleased she was on the discount she got on sunglasses through the scheme,” says Guy.
The attractive benefits extend beyond healthcare, however, and with a growing age profile the business felt it was important to enhance the current provisions for those starting a family.
“From week seven in which statutory maternity pay (SMP) decreases dramatically for mothers, Snowdrop pays a percentage of salary up to week 26, supporting employees for an extra five months,” says Guy.
The scheme means that for those eligible for SMP, they are also entitled to occupational maternity pay based on years of service. For those with two or more years service employees will receive 25% of salary for weeks seven to ten leading to a sliding scale up to week 26. Whereas for those with five or more years service they will receive 50% of salary from weeks seven to ten again with a sliding scale up to the end of the six month period.
“We felt strongly that we did not want to discriminate favourably for the child bearer just because that is the norm. Therefore we offer the partners and parents of adopted children exactly the same percentage of salary (as we do for mothers) over the same number of weeks.”
With statutory paternity pay being a mere £106 per week for a maximum of two consecutive weeks the business found that many new fathers elected not to take up their right because they couldn’t afford to do so. Instead many were opting to take holiday entitlement in its place.
On reflection Snowdrop decided that the first qualifying week of paternity pay or adoption pay would be week one when the pay equals the amount of statutory maternity pay for week seven.
Childcare vouchers are also available and offer employees the chance to take advantage of them on a tax and national insurance exempt, ‘salary sacrifice’ basis.
From talking with employees, Snowdrop also discovered just how much they valued their annual holiday entitlement and therefore decided to reward employees with more paid holidays in accordance with years of service. Just having one year’s service entitles employees to an extra day’s leave while those with four or more years receive 27 days annually.
The business also took the decision to introduce sabbaticals. “We realised that some of our longer serving employees may have aspirations to travel, sit a Masters Degree or just do ‘something else’. Employees have to have at least two years service to take advantage,” she explains.
Sabbatical periods are offered for a three to 12 month period and are based on a nine month notification period. While the period of absence is unpaid, Snowdrop employees that take up this right are eligible to return to their jobs at the end of it.
“In the workshops we held in summer 2005 we identified the need to be far more flexible with customers. In doing so we also needed to be far more flexible with employees. Therefore we wanted to offer employees the opportunity to have greater flexibility within their working day,” says Guy.
The flexible working scheme is based on the premise that employees work a standard seven and a half hour day with an hours break for lunch in a whole block between 7.30 and 18.30 each day.
In line with the acknowledgement that employees have aspirations outside the working day are the free lunch time and evening courses on offer. So far employees have taken part in Spanish classes, car maintenance and nutrition. But for those that still can’t achieve an equitable work/life balance a stress busting helpline is on offer, 24 hours a day, seven days a week and it’s completely free.
On top of these suite of attractive benefits are a range of voluntary benefits. Arranged with local suppliers, employees can take advantage of discounts ranging from conveyancing work, gym membership, food at local restaurants, keys and shoe repairs, home and car insurance and car maintenance.
Asked if there is any link with productivity and the benefits on offer at the business Guy says: “We also offer a bonus scheme this is based upon ten per cent of salary and works on the team and company reaching certain objectives,” and according to this HR Manager it certainly drives performance.
Non-fiscal rewards also help. “We reward employees that go that extra mile. Line managers nominate someone from outside their team and they’re invited to go to our reward room and pick a prize – they’ve ranged from a personal shopping trip at Topshop, to a night out in stretch Limo, fancy restaurants and clay-pigeon shooting and the employee can take a colleague with them too it’s really popular and encourages great performance.”
For Guy the total success of the revised benefits package lies in finding out what employees want, involving them from the outset and being guided by their input.