Wolseley UK has had a very busy past 18 months, introducing a flexible benefits scheme, making changes to its trust-based defined contribution (DC) pension plan and undergoing auto-enrolment staging.
Now the construction and building products distributor, a subsidiary of global organisation Wolseley, is focused on its corporate strategy, including its principles, its employees, and transforming the business to stay ahead of the competition.
Neil McCawley, head of reward, benefits and policy at Wolseley UK, says: “People are one of our biggest assets, so it’s around encouraging people to come to work for us, being an employer of choice.
“We are also making sure we retain people, and benefits are a key part of that. If people see that other employers are offering something really good, it might not necessarily make them move, but if someone is not quite happy, they start to look for reasons to leave. We need to make sure what we offer will bring in the people we want, but also make our people feel good about being here.”
Annual benefits review
Benefits and reward are a key part of Wolseley’s business strategy. Each year, it reviews what it offers to its 6,200 UK staff through a reward steering group, which comprises its UK managing director, its business managing directors, its finance director and its HR director.
McCawley adds: “Every year, over three or four meetings, we review the things we’re going to do. It is around the benefits we offer and whether we want to make any changes.
“It’s a really useful opportunity to sit down and spend some quality time talking about what we’re going to do, what we want to do and what works for the organisation internally, in terms of meeting the business strategy.”
Wolseley UK’s new flexible benefits scheme took effect on 1 January 2014. The scheme, Your Choices, is provided by Benefex, and includes dental insurance, a health cash plan, additional life assurance, life assurance for partners, personal accident insurance and critical illness insurance.
When the enrolment window opened to staff in November 2013, 54% of the workforce accessed the website, which is far higher engagement than McCawley had expected.
“When you bear in mind that only about 20% of employees have access to computers while at work, having another 34% access the website outside of work is really positive,” he says.
The organisation has also seen 35% of its employees change the default setting for their flex fund, which automatically puts 1% of each employee’s salary into the DC pension scheme.
“It’s not just about helping our employees and letting them make their own choices,” says McCawley. “It’s about making sure they have the money they need to retire on. We’re really keen to encourage people to put it into the pension.”
Pension structure changes
Wolseley UK has also changed the structure of its trust-based DC pension plan to drive engagement and highlight the importance of saving for retirement. It increased its employer contributions, which had been between 1% and 5% for employees and between 1.5% and 7.5% for the employer. Now employees contribute between 1% and 9%, while Wolseley contributes between 2.5% and 12.5%.
“As auto-enrolment contributions start to ratchet up in 2017, employees will then potentially need to go to a higher level,” says McCawley. “But we appreciate that some employees can’t find that additional money, so we would probably keep that range, but change our default in line with the legislation.”
The organisation completed auto-enrolment staging on 1 August 2013, increasing its pension member population from about 75% to 90%. “As a company that is keen to encourage employees to save for retirement, we had already effectively enrolled people in,” says McCawley.
“We’ve ended up with around 90% of employees enrolled in our pension scheme. Of the remaining 10%, some of those aren’t eligible and about half are in our three-month waiting period because they are new employees.”
Focus on communications
Wolseley UK focused on benefits communications in 2013 to ensure staff understood the impact of pensions auto-enrolment and the concept of the flexible benefits scheme.
“The project last year is a really good example of where we think our communications hit the mark,” says McCawley. “One of the key things around auto-enrolment was that employees understand what they were being offered.”
The organisation posted colourful, straightforward auto-enrolment leaflets to all employees in June and July 2013. “Even if they didn’t read the whole thing, they would read enough to get an idea of auto-enrolment,” says McCawley.
A similar theme was used to communicate its flexible benefits scheme, with a Flex Matters brochure posted to all employees, posters at its branches and information booklets for line managers that explained all the benefits on offer.
“We followed that up with larger booklets that went out when the website went live,” says McCawley. “It covered brief details of all the benefits we offer.”
Wolseley UK had been working towards introducing flexible benefits for two or three years in a bid to set itself apart from its competition. “None of our immediate competitors offers flex at the moment,” says McCawley.
“It was something we could do to give our employees a choice about the benefits they receive, a bit of extra money to go out and buy them with, and we were going to make our DC pension really competitive, with great rates of employer contributions.
“Wolseley is really a traditional, family-type business. For us, it was around not scaring employees with radical changes. We introduced the core benefits, but, as time goes on, we plan to drip-feed additional benefits.”
The organisation’s key aim was to ensure staff had choice and could decide for themselves whether to use their 1% flex fund to increase their pension contribution, to purchase benefits or take it as cash.
“We have hammered home that pensions are really important, but they can have a choice,” adds McCawley. “It’s helping them to make those important decisions but, at the end of the day, if they don’t want any of that, if they just want money, we give them that choice. But we have also tried to help them understand the implications of the decisions they’re going to make.”
Wolseley UK at a glance
Wolseley UK is the UK operating subsidiary of Wolseley, one of the world’s largest distributors of building products. It was established in Australia in 1887 as a sheep-shearing machine manufacturer, and later became a car manufacturer.
Today it distributes construction products and materials through a nationwide network of branches under the brands Plumb Center, Parts Center, Pipe Center, Drain Center, Climate Center and William Wilson, its Scottish business. It acquired drainage organisation Burdens in November 2012.
Wolseley UK’s head office is in Leamington Spa, Warwickshire, but it also has two other large offices, one in Ripon and one in Aberdeen. It has five distribution centres and 800 branches across the UK.
The organisation employs 6,200 people, 82% of whom are male. Its average length of service is just under 10 years.
Neil McCawley finds value in mentoring
Neil McCawley has been part of the reward team at Wolseley UK since April 2007. He is responsible for all aspects of reward and benefits. Previously, he was reward manager at One Stop Stores, a subsidiary of Tesco, for three and a half years.
His career started at Barclays Bank, where he spent 21 years in various roles, starting in branch banking and ending up as an HR project manager working on reward- and non-reward-related projects.
Outside benefits and reward, McCawley has been involved in the National Mentoring Consortium, which presented Wolseley UK with its New Employer of the Year award in 2013.
“I’m mentoring a student from Brunel University,” says McCawley. “She doesn’t really need any help, except for boosting her confidence. That’s one of the most rewarding things I’ve done.”
McCawley was listed as one of the Hot 100 Benefits managers by Employee Benefits in 2012.
Business objectives impacting benefits
- The key business objective for 2014 is a focus on corporate strategy: its principles, its employees, and transforming the business to stay competitive.
- Being an employer of choice, and attracting and retaining employees.
Wolseley UK offers engaging benefits package
Construction and building products distributor Wolseley UK has built a benefits package with the aim of attracting, retaining and motivating talented employees.
- Trust-based DC pension scheme, available to all employees. Employees contribute between 1% and 9%, while Wolseley contributes between 2.5% and 12.5%.
- Flexible benefits fund default of 1% goes into the pension scheme.
- Defined benefit pension was closed to future accrual on 31 December 2013.
Healthcare and group risk
- Employer-paid private medical insurance scheme for management, about 25% of employees.
- Health cash plan as a flexible benefit.
- Group income protection for a small number of senior employees.
- Group income protection available via flexible benefits.
- Critical illness insurance and personal accident insurance for all employees via flexible benefits.
- Dental cover via flexible benefits.
- Mixture of role-based company cars, either job-need or a perk.
- Flexible working and part-time working opportunities.
- Childcare vouchers.
- Employee discounts scheme, with provider Next Jump.
- On-site canteens at its largest three sites.