Flexible benefits supplement October 2007

Employee%20Benefits%20-%20Flexible%20benefits%20supplement%20October%202007%20coverMake sure a supplier does your bidding
Look for potential savings to fund flexible benefits
It’s tough working out how to refresh flex
Choice over popular perks
Make best use of potential flex data
Flex makes gains in corporate life
Sponsor’s comment: Flew reward: the next generation

Interest in flexible benefits never seems to fade. Even Gordon Brown’s decision to axe the home computing initiative last year, and with it a stream of national insurance (NI) savings, does not seem to have dissuaded organisations from launching or running schemes.

According to the Employee Benefits/Towers Perrin Flexible benefits research 2007, 24% of employers do not yet offer flex but are thinking of introducing it, while a third of employers already run schemes.

However, Brown’s decision means that funding schemes on a cost-neutral basis is now more difficult for employers. Given that few employers operate salary sacrifice around pension contributions through flex, they will find it hard to use the NI savings on childcare vouchers and bikes for work alone to cover the full cost of setting up and running a scheme. Employers can, though, use the introduction of flexible benefits to renegotiate terms with providers and thus make savings that they wouldn’t otherwise have.

But there are also intangible benefits to be gained that make operating a flexible benefits scheme more than worthwhile – staff recruitment and retention and employee engagement all positively benefit.

So with a little innovative thinking, employers may find that the savings and intangible benefits combined result in flex coming close to being cost-neutral.

Amanda Wilkinson,
Editor, Employee Benefits magazine