Need to know:
- Employees are increasingly seeking out organisations that share their values.
- Employers must demonstrate their commitment to their values, embedding them in everything from the facilities to policies and benefits.
- Providing employees with a pot of money and allowing them to select how they spend it can support a more diverse range of expectations.
A compelling reward and benefits package is essential when it comes to attracting and retaining employees. Understanding their expectations and reflecting these in the benefits strategy is also key. The challenge for employers is that these expectations are shifting.
Cheryl Brennan, director of corporate consulting at Howden Employee Benefits and Wellbeing, says: “Generation Z and millennials are driving a new perspective on employee benefits and, ultimately, what is valued. Generation Z especially is more focused on how it feels to work for an employer.”
It is not just the youngsters that are driving change. Traditional benefits, such as pensions, can lose their appeal with older workers, while others, such as group risk products, can be out of reach once someone gets to state pension age.
Employee wish list
Against this backdrop, what employees want is changing. “Key focuses are on wellbeing, work-life flexibility, career development and corporate social responsibility,” explains Brennan.
Indeed, Aon’s UK benefits and trends survey 2020, which was published in January, confirmed that 97% of employers found that staff wanted more flexible working hours. Also in the top five were agile and home working (94%); better awareness and handling of mental health issues (88%); a better approach to diversity and inclusion (72%); and improved parental policies (68%).
Richard Morgan, principal at Aon, is not surprised by these findings. “Employees have been asking for these for a few years,” he says. “The one I find particularly interesting is environmental and sustainability policies, which 54% of employers cited. Employees want employers to help them do more in these areas but they expect them to lead by example too. For many people, it’s important to work for an organisation that shares their values.”
Building the benefits
This new set of expectations requires a different strategy. Rather than simply switching the benefits package around, organisations need to take a much broader approach. “Employers need to think about how they demonstrate their values through the workplace, benefits, policy and community. Everything needs to be joined-up,” Morgan explains.
For example, green credentials in the workplace could be demonstrated through recycling and smart office lighting and heating. Relevant policies might also include a drive to reduce travel, through increased home working or better use of technology for video-conference calls, while the community aspect could be reflected in volunteering and charity support.
“Benefits help to join the dots,” adds Morgan. “A season ticket loan encourages public transport use while bikes for work and electric vehicles help to reduce emissions. Carbon offsetting schemes are also becoming more popular.”
As well as ensuring that values are embedded throughout the organisation, personalisation is also helping to match benefits to employee expectations. Kerry Jarred, managing director of Ignium Consulting and Jarred Consulting, explains: “Employees want so many different things, so providing a pot of money and letting them choose what they want is very powerful. This works particularly well for benefits such as wellbeing and personal development.”
Delivering changes
Expectations are also shifting in the way benefits are delivered. Jack Curzon, consulting director at Mercer Marsh Benefits, says: “Employees expect a consumer-grade experience. They’re used to buying something on their smartphone and receiving it the same day and they expect this in the workplace too.”
Technology can help to replicate this, with employees able to access everything from shopping discounts to wellbeing apps and pension statements on their smartphones. Similarly, the shift away from annual benefits windows to allowing employees to switch whenever they like can also help to meet this demand.
The yen for almost instant gratification also feeds through into recognition and rewards. Where organisations used to celebrate long-service and pay bonuses annually or quarterly, there is now a drive to recognise good performance immediately, says Robert Hicks, group HR director at Reward Gateway.
“If an employee saves the organisation £5,000, for instance, sending them a £50 thank you can be very powerful,” he explains. “Make this visible, so there’s also social recognition, and it will influence other employees, creating more good performance.”
Employee buy-in
Whether an organisation is building a new corporate identity to meet the demands of new employees, or wants to ensure new recruits buy into an existing set of values, a structured marketing and communications programme is essential.
“Talk about corporate values can be really high-level and wishy washy,” says Curzon. “Saying the culture is about innovation and diversity means nothing and can be particularly problematic if the organisation has old-fashioned processes and technology. Employers must ensure they are part of the fabric of the organisation.”
Doing this can be challenging, especially where components are owned by different parts of the business. “Many organisations are already doing lots of things that align with their stated values,” says Morgan. “Having someone responsible for coordinating this and marketing it to employees will help. It’s best to keep messages simple and to keep repeating them.”
A total reward statement can help to underline the experience an employee can expect. “As well as all the traditional benefits, we include everything from volunteering opportunities to the company’s sustainability activities,” explains Hicks. “By including everything, it really helps to emphasise what the organisation does, and what it means to be an employee.”
Meeting employee expectations can be a challenge, especially given today’s increasingly diverse workforce. But, as values and experience become increasingly important to employees, a well-coordinated marketing and communications programme is valuable.
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