EXCLUSIVE: Hay Group has undertaken a full review of its employee benefits to help fund the cost of auto-enrolment.
The global management consultancy, which has around 350 employees, reached its auto-enrolment staging date on 1 February 2014.
Charlotte Koch (pictured), head of HR at Hay Group, said: “Auto-enrolment allowed us to take a full review, which we have not done for a while. Things have changed and we needed to take a fresh look at our spend.”
The organisation has made a number of changes to its benefits provision as a result of the review, in order to reinvest money in other parts of employees’ benefits package.
This includes a change to the contributions Hay Group makes to employees’ group personal pension (GPP) plans.
From January 2014, all employees receive pension contributions of 9% of base salary.
The organisation previously provided pension contributions that were 15% of the difference between employee’s salary and three-times the lower earnings limit.
“The pension structure was unfair because of how calculations were made based on an employees’ salary,” said Koch. “We had [contributions] ranging from 3% to 13%. We didn’t feel this was right and wanted to be fair to all employees.
“We thought 9% was very competitive and we didn’t want to create an imbalance among employees. This change has helped mitigate the future cost of the pension scheme.”
Hay Group has also removed dependents’ cover from its private medical insurance (PMI) scheme after the cost of PMI doubled over the past five years.
Employees are able to add dependent cover via the organisation’s flexible benefits scheme, More Than Money.
Other changes following the review included:
- The phasing out of its lease car scheme after only 12% of employees took up the scheme.
- Life assurance was reduced from five-times annual salary to four-times annual salary.
- The removal of the referral scheme bonus, which enabled employees to receive a bonus payment for successful referrals.
Koch added: “It was our intention to look at where our spend was and where our priority was to spend. Some of our benefits hadn’t been reviewed for 15 years.
“We have made these adjustments with the intention to reinvest money that’s saved on certain benefits, and we have done that to create a competitive benefits package.”