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Annie Hayes

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Employee benefits: The ‘third’ way

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Explaining the advantages of voluntary benefits, Sandy Wilson, Head of Reward and Employee Relations at insurance giant, Norwich Union talked to HR Zone about reward and how his company recovered from the budget blow that signalled the end of the popular Home Computer Initiative.


Norwich Union is part of the Aviva group and as such is the biggest insurance group within the UK with a 35,000 UK-strong workforce to boot. As the Head of its Reward and Employee Relations functions, Sandy Wilson’s job is about creating a competitive employment proposition, understanding lifestyle choices and accommodating for a varied employee demographic with different needs and wants. And of course the success of this or otherwise has a very real bearing on employee retention, recruitment and productivity.

Typically anything with the word ‘voluntary’ attached tends to be viewed with caution and reticence after all if it’s not compulsory why do it? Wilson explained what benefits the voluntary way means at his organisation:

“Voluntary benefits give employees choice. Employees can either take advantage of them or leave them. The essence of our scheme has two parts. We offer voluntary benefits that are sponsored by the Government’. Ones for which the Government provides support such as was the case with the Home Computer Initiative (HCI), bikes for work and childcare vouchers.

“In addition to this we offer our employees a range of our own products and services and the opportunity to take advantage of affinity relationships we have in place with other providers.

The most popular, says Wilson of the government supported beneifts was the HCI. Under this scheme companies were allowed to loan computers to their employees as a tax free benefit. But the initiative was axed in the Chancellor’s recent budget and ceased on 6 April 2006.

“It was unfortunate timing for us because we only launched the scheme last October. A number of employees didn’t take advantage of it immediately but were planning on doing so. Thankfully we were able to react quickly to the changes and were able to get interested parties signed up before the scheme stopped. A further six hundred of our people took part.”

Wilson admits to a degree of organisational nepotism when it comes to offering discounts on its own suite of insurance products. And looking not much further then its own garden gate has paid dividends for triggering brand loyalty and tying in employees’ service to at least the life time of their discounted policies.

“The most popular of our Norwich Union voluntary benefits tend to be car, household and travel insurance,” he explains.

And the strategy of ‘keeping it in the family’ applies in part to its third-party benefit suppliers.

“We have relationships in place with people like Halfords and Empire Direct for example – retailers that we use in our business of insurance on a daily basis. Employees can get discounts on TVs, fridge freezers etc but we also have affinity partnerships with organisations and outfits in the local area. For example, Norwich Union employees can get discounts from certain restaurants and retailers in our locations as well as gym chains.”

Wilson explains that the voluntary benefits scheme which has been in place in main since last year and married to long-term existing schemes such as the discounts on its products and services is very much a bolt-on to the core benefits structure.

“We don’t offer a flexible benefits programme The strategy behind our reward policy is to maximise our employees spending power by giving them the opportunities to get more from their purchasing decisions via discounted rates,” says Wilson.

And the voluntary benefits scheme is only the start of a journey into a wider suite of choices says Wilson who plans to introduce mobile phones and car parking and retail vouchers to the list of voluntary benefits under their Allsorts scheme, later in the year.

To hear more of Norwich Union’s experiences and how they ensure that their voluntary benefits scheme remain competitive and supports retention then don’t miss Sandy Wilson’s talk, taking place at the Employee Benefits Exhibition and Conference, The Armitage Centre, Manchester from 26 – 27 April 2006. Find out more at: http://www.employeebenefits.co.uk/exhibition/

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Annie Hayes

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