In these days of internet and telephone banking, most of us check our balance each day, perhaps even more just before payday. However, we do not check the value of our pension statement, which is especially important if we are in a defined contribution (DC) plan subject to the vagaries of the stock market, and are even less likely to estimate the cost of our medical and risk benefits unless comparing them to a potential new employer’s.
So, how can employers make employees value these hidden assets as much as their cash, in order to maintain motivation and loyalty?
Of course, the employer has to work within a budget aligned to organisational strategy, but whether the organisation is profitable, expanding fast or in cost-cutting defensive mode, promoting the value of benefits will help retain key talent.
The way in which employers can identify the benefits employees think they need is usually through a combination of analysis of online engagement surveys, as well as the interpretation of external factors such as generational preferences.
Employee surveys not only gauge engagement, but also determine the workforce’s perception of the benefits offering itself. This can vary significantly in different countries; US medical care, for example, does not have the safety net of the NHS, while European benefits have far more obligatory content than the UK or Switzerland. How would an employee compare shared parental pay in the UK and Sweden? How can global consistency and equity be maintained across international borders?
The answer to this is, as ever, that it depends on the employer. A small business may be able to publicise its benefits through informal meetings and regular emails, where larger employers may need to consider flexible benefit schemes, which have the benefit of cost reduction through economies of scale. The benefit to the employee of the flexible benefits scheme is that they can tailor their choice of benefits.
Having designed a benefit offering that reflects organisational and employer needs, sophisticated methods of communicating through benefits technology can be used to convey the value of the package through total reward statements. The simple way might be an email with a standard leaflet, but if the employer really wants to engage with staff, the smart answer is an online version. This way, the employee might just check their benefit statements as often as they do their bank balance.
Simon Richardson is senior lecturer in HR at Westminster Business School, University of Westminster