In recent years ‘wellbeing’ has become a bit of a benefits buzz-word with many employers now feeling that they have some level of responsibility for looking after their employees. The reasons are varying, including factors such as commercial benefit, legislative requirements or the desire to be seen as an employer of choice. A typical wellbeing strategy could cover mental and physical wellbeing, but also encompass family and financial health as well as even ‘career health’ (in the form of training and development opportunities).
However, for many employers, implementing such a strategy will not always be possible in practise due to resource and, more importantly, cost constraints. So, could utilising a flexible approach to benefits delivery help HR to deliver a wellbeing strategy?
Perhaps the first place to start is the obvious – physical wellbeing. An employer could offer a range of benefits (on a core or voluntary basis) which provide a mix of preventative treatments/cover and restorative ones. For example, a core employer-sponsored benefits scheme could include an Employee Assistance Programme providing access to a helpline and even face-to-face counselling sessions, covering issues such as family health, stress, debt, etc.
Such a benefit can help an employee to deal with matters before they become bigger issues, which in turn may mitigate the chance of an employee making a claim under an insurance policy or being off work for sometime.
Employers should also look to add preventative benefits, such as discounted health screening, into a flex scheme. Not only are these tax-efficient benefits, but they allow employees to consider their lifestyle and make changes in order to live a healthier life: the hope is that in return, fewer would claim on any medical policy or be absent.
These can be supplemented by providing access to discounted gym membership, private GPs, dental cover, (which fulfils both prevention and cure) etc. Again, these are easy benefits to add to a flex scheme, for employees to access on a voluntary basis, as required.
Wellbeing needs can then be complemented by access to private medical cover. Employers may provide a basic level of cover as they want to make sure an employee is treated quickly and able to return to work in as short a time as possible.
However, a flex scheme could be used to offer the employee the option of covering dependents, so reducing the possibility of the employee suffering from stress or anxiety should a family member require medical treatment. If providing access to medial treatment is important as part of the wellbeing strategy, then an employer must make certain it does not allow employees to opt out under a flex scheme and use the funds this releases to spend on other benefits instead: this would in effect undermine the wellbeing strategy and go against what the employer is trying to achieve.
Cash plans have historically been seen as the ‘poor mans private medical scheme’ – but this is not correct and they should be used as part of a wellbeing strategy in their own right. It is not uncommon to see them in flex schemes as a pre-cursor to private medical insurance (PMI) or to run alongside, especially where the PMI has an excess in place.
In this way, any cash plan can be used to claim for more minor treatments or to allow treatments which would be below the excess amount on the main PMI policy – such as a course of acupuncture or visits to an osteopath. In this way, fewer claims may be made on the PMI scheme and hopefully a more favourable claims experience could lead to lower annual premiums ongoing.
However, as we said, it is not just about physical wellbeing. There has been a growing interest recently in personal accounts within flex schemes. An employee could sacrifice salary or use part of a flex fund (from trading down on core benefits or from a fund provided) to put into a personal account, the value of which the employer could match (on a chosen basis such as one for one).
This account can then be used for a range of purposes to tie in with the company’s requirements. Where this may have a theme of wellbeing, the money could be spent to fund a spa break, or a stress-relieving activity (pottery, flower arranging, etc). It could even be used to further professional development and training.
In conclusion then, a flexible benefit scheme can easily be used not just to promote any wellbeing strategy but also its delivery and ongoing management.
- Julia Turney is Head of Benefits Management at Jelf Employee Benefits