Why Employee Benefits?

Why Employee benefits? Surely, it is just another cost?

As a business owner and employer, this is something that we must all consider – cost against return.

In many ways, this is a simple question. If we don’t have good quality staff that care, we can’t deliver the business, or earn money, ultimately leading to business failure.

How many staff, and what we pay them is a slightly different question, and one we can perhaps talk about later and in more detail! But fundamentally, always work on the basis that we need enough capacity in the business to deliver what we plan plus 10%. As to how much we pay, there is nothing wrong with the old saying “pay peanuts, get monkeys” or “take advantage of the staff, and sooner rather than later, they take the advantage away”.

So, best advice is be on the slightly generous side of fair, as long as the business can afford it. This policy will reward you in the long run.

Increasingly, just providing a salary is not enough to keep talent. The workplace is a competitive place and quality, well trained, and productive staff are any business’s strongest asset. The reverse is equally true… Poor, ill-informed, badly motivated staff can literally kill a business!

The mantra must be: If you have good staff, value them like the assets they are. They need nurturing and maintaining like any performing asset, and if you need more staff, create an environment that will be attractive.

All sounds great (albeit a bit woolly!) So, let’s look into this further and make some basic assumptions:

● We are assuming that our salary conditions are good, but so is everyone else!
● As a management team, we offer regular reviews and try to make the working environment as friendly as possible, whilst still giving real clarity as to performance – good, bad, or indifferent.
● We are offering some degree of flexible working where possible. This is increasingly popular. However, many businesses (particularly with a young or dynamic workforce) need the element of interaction that can only be gained through physically meeting colleagues and talking through the work.

Flexible pay, salary sacrifice, and other benefits, is an area where amazingly, many businesses are just not focusing! Seeing them as either a massive cost, or too difficult to implement for a business without ‘00’s of employees.

In fact, even for the smallest of companies, some degree of staff employee benefits is perfectly possible. At Charlie Puffin Group, we are specialists in providing a range of options that are cost-effective and easy to implement, whilst still offering real, tangible benefits to both the business and the employee.

Pensions: With recent legislation, this is no longer seen as a benefit, but as a legal right of employment. Many companies have just done the basics and taken a “Nest” or “People’s Pension”. Both are great products, and deliver an excellent basic pension for the employee and employer at a low cost. However, if we dig a little deeper, there are limitations. The ability to offer salary sacrifice is an increasingly important element of any employee’s retirement planning. Additionally, there is a benefit to the employer with the ability to offer the employee a tax efficient method of increasing their Pension contributions, and salary sacrifice offers Employer NI Savings. It may be sensible to consider switching providers – just contact us for more information.

Private Medical: Often considered the Blue Riband of Employee Benefits and something that only large employers can consider, “and boy is it expensive!”. It’s true that this is a highly valued benefit that can really excite staff. With the current pressure on the NHS, there has never been a more important time to consider the risk and cost of long-term absences due to waiting lists. But, it’s not true that it’s only for large companies – as few as 4 members can get a working scheme up and running. As for it being expensive, that’s equally not true. We have policies with reduced benefits, but providing cover at just £8 PCM for a 54-year-old! As with most policies, it is a matter of asking questions and tailoring a scheme that delivers the benefits both to the business and the employee.

Death in Service: A good DIS Policy is just a must for any business. Not only is it relatively inexpensive, it can also provide valuable peace of mind for all employees. DIS is also useful insofar as it can often offer cover to both Directors and staff, without any need for medical underwriting.

Income Protection: I always recommend this to every business I am involved with. One reason for this can be considered, on one hand, selfish! We are constantly hearing that 1 in 2 of us will be affected by cancer. The recent Pandemic also brought long-term sickness to our attention. I don’t want to have to tell an employee with a chronic illness or cancer that unfortunately, we will be placing them on long-term statutory sick or letting them go because of illness… Can you imagine that conversation? However, Income Protection protects me from saying that! Instead, I would be in a position to say “Don’t worry, we have a policy in place that will pay you 75% (or could be 50%, or even 100%) of your salary for the next 3 years (or could be longer), so that when you hopefully get better – you can return to work.” At a very low cost, I would question who here has the bigger benefit, me or the employee!

These policies are just a few of the options, all of which benefit the employer as well as the employee. All can be dealt with by way of salary sacrifice, and so benefiting from lower employer and employee NI costs, or paid for by the company totally. The point being, no matter how large or small the company, there is flexibility to offer that bit extra which makes a business a “better” employer. Most importantly, it allows a business to nurture its biggest asset – the people that work there!

Our experienced and knowledgeable team are on-hand to offer advice and support to help you find the right benefits package for you and your employees.

Get in touch! Call us on 020 7183 8241 or send an email to [email protected].