How has the hybrid working trend impacted benefit and reward strategies?

Need to know:

  • The future of work is likely to be made up of a mix of office and home working.
  • This is having an impact on what benefits employers offer.
  • How employers communicate with staff will also need to change in a hybrid model.

The potential for most employees to work from home has existed for the past decade or more, but it has taken Covid-19 (Coronavirus) for many businesses to really embrace it. While some employers are now keen to bring staff back into offices, for most this will be on a hybrid basis, with employees splitting their time between offices and home.

Research by Howden Employee Benefits and Wellbeing of UK-based HR professionals, published in July 2021, found 39% of respondents expect partial home working to be available to all workers, with a further 46% intending to introduce this for at least some employees. A separate study from Vitality, Healthy hybrid; a blueprint for business, published in May 2021, found 48% of staff want to work on a hybrid model, with an additional 36% keen to do so from home permanently.

Reward in hybrid model

The changing model in how, and where, people work means those in reward and benefits roles need to think about how they can best incentivise and motivate staff in a hybrid set-up. Andrew Drake, client development director at Buck, says: “The trend for hybrid working is a serious challenge for employers in ensuring that what they offer remains fit for purpose, so it’s vital that they take stock of what their employees want in a post-Covid world and tailor their benefits accordingly.”

One general trend, says Ruth Thomas, co-founder and senior consultant at Curo Compensation, is a move towards greater individualisation of benefits. “The pandemic led to some degree to a humanisation of the workforce,” she says. “We had to treat employees as individuals with their own complex health and personal circumstances that impacted their ability to perform. We are seeing the emergence of a more individual approach in how we treat employees, with a need to design more equitable and human-centred workplaces, work experiences and reward packages.”

This also means there will be a degree of shake-up across employee benefits provision. Employers have realised that the offer of more benefits rather than less is essential, says Craig Williams, director of employee benefits at Broadstone. “Choice is often being facilitated by the introduction of a flexible benefits allowances, either newly created or created by redirecting employer spend away from historically inflexible core benefits. If employees decide that they don’t need to spend that allowance on ‘traditional’ core benefits then it provides a ‘bank’ of money that can be used to provide benefits that they truly value and are reflective of their new employment circumstances,” he says.

Not surprisingly, health and wellbeing benefits are in high demand. The Vitality survey found 80% of people say they are now looking for a better work-life balance, while 71% are keen for their work to allow them to live a fit and healthy lifestyle. “The focus for those who continue to work from home has been on benefits promoting health and wellbeing in a home-working environment such as online fitness classes, wearables, sleep sciences, eye-care plans and benefits focusing on mental wellbeing support,” says Williams. But other benefits more associated with the office are also seeing an increase in interest, including breakdown cover, car leasing, company cars and service plans, he adds.

Corporate purpose

Alongside the focus on wellbeing, there’s a wider shift towards benefits with an environmental and social element. Richard Morgan, principal consultant at Aon, says: “The events of the past 18 months have encouraged employers to consider their ‘purpose’ in a much broader sense than simply maximising profit.” Morgan explains that there is an opportunity to align benefits with these objectives. “For example, we are seeing a huge increase in the number of clients implementing ‘green’ car schemes and other environmentally-friendly benefits,” he says.

It’s a trend Nick Burns, CEO of Gallagher’s UK employee benefits consulting division, has also noticed, explaining that many business leaders are introducing charity days or matched fundraising. “At the same time, those benefits that focus on a more mobile workforce – travel benefits, international plans, concierge services and travel insurance – have all seen considerable pressure to remain relevant to an audience that often remains firmly wedded to their home postcodes,” he says.

Flexible working will form a huge part of the future, but that also means it’s less likely to be seen as a benefit but rather something that is expected. Katy McMinn, co-founder and director of HRi points out that there will still be a need for adaptations to other benefits that can help with this. “Some examples might include offering local gym memberships instead of those close to the office, contributing to home office set-up costs, the provision of ergonomic desks at home or changing working hours to avoid rush hours,” she says.

Parental benefits trends

Childcare is also likely to be even more of a priority if employees are in and out of offices, operating in a more flexible and less predictable manner. “Without flexible childcare, the move towards more flexible, hybrid working simply won’t work and parents’ lives will become increasingly more stressful than they need to be,” says Ari Last, CEO and founder of childcare provider Bubble. “Lockdown showed us all clearly, both for parents and the [organisations] they work for, that tending for your child while focusing on a work deadline is not a sustainable, ‘real life’ solution.”

Another benefit which is surging in popularity in the wake of the pandemic is online tutoring. Guy Winter, head of corporate partnerships at GoStudent, says his organisation first noticed increased demand in April 2021, and this shows no sign of tailing off. “Parents are aware that it will take a while to correct the issues that lockdown has caused with education,” he says. “By offering a benefit like discounted tutoring, supportive [employers] are able to go some way in easing these concerns.”

Consistent communication

Communication also becomes even more vital in a hybrid working model, and many of the tools that were previously considered as nice-to-haves are now becoming mainstream, says Williams. “Video content, SMS messaging, webinars and social media are being introduced alongside more traditional methods of communication,” he says. “At the same time, benefit platforms are being built to encompass wider employer offerings such as social events, wellbeing weeks, volunteering arrangements, charitable projects, support groups or any other ‘non-traditional’ benefits an employee might have access to.”

When talking to employees it’s vital to focus on what they need and want, advises Vicky Fagan, founder of internal and marketing communications agency FJC. “Communications should always invite colleagues to the conversation and ask what they’d like to do,” she says. “Keep it clear, consistent and regular. Use multiple formats so that communications work for team members wherever they are based, and ensure that tone of voice and messaging remains consistent.”

What employees want in a new, hybrid world may also alter over time, as alternative ways of working bed in. Iain Thomson, director of incentive at Sodexo Engage, says it’s important to keep an eye on this. “Hybrid working and the overall shift in employees’ views and approach to benefits mean that it’s vital to understand what employees are looking for when it comes to benefits and adapt quickly and accordingly,” he says. “Data will be key to keeping on top of this, noting which benefits are gaining traction and which are falling in popularity. Such data will also be key for maintaining a strong ROI with the rewards and benefits strategy.”

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