Marks and Spencer (M&S) knew it was undertaking an ambitious project when it set out to launch a flexible benefits scheme to its entire workforce in 2013.
Most of the retailer’s 75,000 UK employees work offline across more than 800 stores, so it had to develop a scheme that was accessible via multiple channels.
Fortunately, the retailer allows its customers to shop through a range of channels, such as in-store, online and via mobile, so it was well positioned to extend that experience to its staff.
Employees can access the flexible benefits scheme, which is provided by Benefex, from wherever and whenever they want, through computers, mobile phones and tablets.
This multi-channel approach has enabled M&S to reach employees with whom it was historically difficult to engage.
Before it launched the flex scheme in August 2013, M&S offered staff a range of standalone benefits, such as childcare vouchers and a pension scheme that was available via a salary sacrifice arrangement. It also offered a bikes-for-work scheme for head office-based employees.
Gary O’Neill, head of international reward and mobility, was reward manager during the flex scheme’s launch. He says: “It had been on separate platforms with documentation held on an internal portal. It is now on a single platform, called Choices.
“Employees have their own login; then they can see what is specific to them. Previously, they had to read all the policies and documentation to find out if they were eligible to participate. The system now works so employees see what is available to them.”
Giles Nicholson, reward manager at M&S, adds: “It is one helpline now. In terms of employees getting support, it’s all in one place, which makes life a bit easier for everybody.”
Aligning reward strategy with business objectives
The flexible benefits scheme was designed to align M&S’s reward strategy with its business strategy, which is heavily focused on its sustainability programme, Plan A.
Plan A was launched in January 2007 and sets out 100 commitments for the organisation to achieve in five years, with the ultimate aim of becoming the world’s most sustainable major retailer.
New benefits introduced as part of the online flex scheme are aligned with Plan A. O’Neill says: “The car leasing scheme supports our Plan A policies, so employees are driving more CO2-efficient cars.”
Nicholson adds: “It is the same with bikes for work. Those initiatives support the Plan A initiative.”
Another key focus of M&S’s business objectives is to engage staff with the benefits package. For instance, its new holiday buying scheme is aimed at improving employees’ work-life balance, combating absenteeism and driving employee engagement.
Its new computer scheme is aligned with its multi-channel strategy. O’Neill says: “If you’ve been into an M&S, you might have noticed that we’ve got iPads and big screens in stores. The scheme was launched to help support that and to help our employees become more familiar with technology.”
Apart from the computer scheme, which is deducted from employees’ net salary over 12 months, all the other flexible benefits are available through a salary sacrifice arrangement with payments taken from employees’ gross salary.
Winner at the Employee Benefits Awards
Marks and Spencer rolled out the scheme in August 2013 and won the award for ’Best flexible benefits plan’ at the Employee Benefits Awards 2014 in June.
Of particular interest to the judges was the way the organisation tackled one of its biggest business challenges. Nicholson says: “We are a business with offline employees. The site is accessible on any device from any location.
“That is a key benefit and a key message we got out to people. They can learn about it, read about it, play with it in their own time or in work time.”
M&S harnessed the power of its own staff to communicate the new flex scheme across the organisation. Representatives of its Business Involvement Group (a staff committee comprising representatives from different parts of the organisation tasked with keeping peers up to speed with business developments) took part in a conference call to learn about the scheme and how it worked.
Nicholson adds: “They were really set up to make sure the scheme is successful in each of their stores.”
The organisation also used traditional media, such as posters in stores; Table Talkers (freestanding, cardboard-based promotional literature), which got the message out in canteens and shared areas; and digital channels, including internal social network Yammer.
“We are really trying to engage with employees through Yammer, not just telling them what is available, but having a chance to hear what they think as well,” says Nicholson. “It’s a real two-way process.”
During the flex scheme’s first enrolment window last August, M&S also held about 15 roadshows at its larger stores. It invited suppliers, such as Halfords for its bike scheme and Leasedrive for its car scheme, so employees could ask questions about the benefits.
O’Neill adds: “It gave employees the opportunity to get that first-hand experience.”
Because M&S could not host roadshows at all its 600 locations, representatives of the Business Involvement Group came to the 15 events so they could take leaflets and other information back to their own stores.
The flex scheme has just opened for its third enrolment window (it opened its second window in April in line with its financial year), with benefits taking effect from 1 October 2014.
The new online flexible benefits portal has succeeded in increasing benefits take-up. More than one-third (35%) of staff engaged with the scheme in its first four weeks, with 25% of those selecting one of the new benefits.
In July 2014, 41% of employees were engaged with the scheme, with 60% more staff taking a benefit during the second enrolment window than during the first.
“We’re still really new, which is why we’re so pleased to have won the award,” says Nicholson. “Take-up from the first window to the second window went up dramatically. We were really pleased with the progress and we’ll have to see how we go this autumn.”
Marks and Spencer at a glance
M&S has evolved from a single market stall 130 years ago to become an international multi-channel retailer and one of the UK’s largest retailers.
It employs nearly 86,000 people across 54 global locations. In the UK, a total of 75,000 employees are based in 798 stores and six office locations.
Of its total workforce, most are customer assistants who do not have access to computers or the internet during their working day.
Gary O’Neill, who is now head of international reward and global mobility at M&S, was reward manager during implementation of the flexible benefits project and during its first enrolment window, in August 2013.
His previous roles in the industry include benefits and compensation officer/consultant at McDonald’s Restaurants, reward analyst at Barclays Bank and reward analyst at Sainsbury’s.
Giles Nicholson has been reward manager at M&S since June 2013 and is currently overseeing the organisation’s flex scheme.
His previous roles in the industry include reward manager at Taylor Wimpey, reward and recognition manager at London Underground and reward manager at Tesco. He has also held various reward roles at Deloitte.
- Childcare vouchers
- Bikes-for-work scheme
- Car leasing scheme
- Computer scheme
- Holiday purchase scheme
- Retail discounts