Why traditional one-size-fits-all employee benefits schemes no longer work

traditional one-size-fits-all employee benefits

Companies can no longer rely on traditional employee benefit schemes to attract and retain talent. An increasingly diverse workforce requires flexibility, imagination and innovation from its employer’s reward and recognition programme.

Though there is still much to be done to promote diversity the modern workplace has never been so varied. Over the years, immigration has introduced new cultures, ethnicities and even languages. The age gap between oldest and youngest is growing, with an increase in the state pension age at one end and greater focus on apprenticeships at the other. And with many women starting a family later in life, the gender imbalance is shrinking (even if the pay gap remains frustratingly wide).

Such diversity presents buckets of opportunity but also one or two challenges. Foremost among them is the demise of the one-size-fits-all employee benefits scheme. The question of how best to motivate and incentivise so many different groups has emerged as one of 2017’s biggest boardroom head-scratchers.

The Millennial ‘problem’
Take the age gap. As we get older our risk profile changes. We spend less, save more. Pensions assume a greater significance, as do health and life insurance. Older people are more likely to see work as a means to an end, rigorously compartmentalising their personal and professional lives.

Younger colleagues are less likely to have such a marked contrast between work and play. They expect employers to help them keep up external interests and stay fit and healthy. They’re more likely to value subsidised gym memberships, gig tickets, on-site yoga classes or wellbeing seminars – activities and staff perks that leave older colleagues scratching their heads.

Neither do they see work as a forced trip to an office between 9-5. Averil Leimon, a leadership psychologist, points out that because they grew up with technology, Millennials are comfortable with remote working and don’t see the need to commute for the sake of it. “They don’t ‘go to work’, they just work,” as she puts it.

The price is right
Employers must also recognise the impact of income on employee benefit schemes. There’s no point offering discounted opera tickets if they still cost the same as a week’s wages. Neither are investment bankers likely to appreciate 10% off their next shopping trip to Superdrug.

HR teams are increasingly turning to sophisticated discounts portals that offer a range of voluntary benefits organised by income band as well as preference.

It’s a small world
Modern organisations are often multicultural reflections of the society around us. In recent years employers have placed greater emphasis on creating a work environment that is safe and inclusive for all, regardless of ethnicity or country of origin. The next step is to make sure this is reflected in employee benefit schemes.

For example, travel-related perks and learning opportunities won’t work for colleagues with restrictive visas. And a boozy night out to celebrate a new client win won’t have the same appeal if your religion, health, or personal goals limit the alcohol you consume. As such, it is becoming increasingly important for employers to offer a wide range of perks, discounts and other types of benefits to reflect the diversity of their workforce.

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If you’re interested in finding out more about how your organisation can expand its range of voluntary benefits, keep an eye out for our forthcoming e-book that includes a case study of our work with the Metropolitan Police.

For more information on solving the challenge of recognition within an age-diverse workforce download our free guide.