Category Archives: Employee benefits

No employee benefits in place for nine million UK workers

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Almost one-third of workers in the UK do not receive any employee benefits at their organisation, with women the least likely to be rewarded.

This is according to new research conducted by Canada Life Group Insurance, which found nine million individuals – 30 per cent of the nation’s workforce – are in this position, despite the fact 31 per cent would like more recognition. In addition, 20 per cent of respondents stated they believe changes like auto-enrolment could increase the importance of any benefits offered by an employer.

Paul Avis, sales and marketing director of Canada Life, said he is disappointed to find that such a high percentage of staff in Britain do not receive workplace benefits.

He remarked: “They may well feel that they are lacking in the support or recognition that they deserve and with upcoming changes such as auto-enrolment putting workplace benefits firmly in the spotlight, they are even more likely to notice the lack [of benefits].”

The report revealed that among the participants who are rewarded at their company, a pension with employer contributions was the most commonly received, as it was found to be in place for 47 per cent of people.

Meanwhile, 39 per cent of workers had been granted more than 28 days holiday and 36 per cent were provided with a life insurance or death-in-service policy. Just five per cent claimed their employer had given them free gym membership and four per cent stated they can receive a lump sum of cash towards critical illness cover.

Mr Avis said now is an ideal time for managers to decide – with the help of an advisor – what benefits and savings plans they could offer their staff and how to make existing schemes stretch further.

He was quoted by HR Magazine as saying: “It won’t just benefit employees, but businesses too, as happy, healthy and secure workers are far more likely to be productive.”

This comes after a recent study published by insurance firm Aviva announced 90 per cent of companies that introduce health benefits experience greater productivity and motivation.

What the Autumn Statement means for employee benefits

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Yesterday (December 5th) saw the announcement of the government’s Autumn Statement by chancellor George Osborne.

Among the politician’s proposals included a number of issues relating to the world of employee benefits and discussed the ways in which the everyday lives of British workers might be affected by the legislation.

Whether it is through company car incentives, a worker shareholder scheme or tax support for employee owners, it is likely all individuals will face changes of some kind within their organisation.

According to Mr Osborne, the government is going to consider the matter of offering incentives through vehicle tax initiatives to encourage people to buy ultra-low emission vehicles.

After listening to the views of car manufacturers and motoring groups, MPs will assess the validity of offering benefits packages promoting the adoption of the automobiles, which could offer managers tax and national insurance breaks.

One business development director, Alison Argall of fleet car leasing firm Tusker, told Employee Benefits her business is delighted to see Parliament is supporting the campaign for low-carbon vehicles.

“We have seen significant increased take up of ‘green’ cars over the past couple of years, which additionally provide further fuel efficiencies to our company car drivers, as well as reducing our customers’ carbon footprint,” she added.

Pensions is another area Mr Osborne covered in the statement and he confirmed the launch of the Pension Infrastructure Platform (PIP) for the first half of 2013.

This initiative – which was signed by the National Association of Pension Fund (NAPF) and the Pension Protection Fund (PPF) in 2011 – is seeking to boost investment made by British pension schemes in UK infrastructure.

In October 2012, it was announced by the NAPF and the PPF that seven major UK pension funds have signed up to the cause as founding investors, including BAE Systems Pension Funds, BT Pension Scheme and West Midlands Pension Fund.

Although the government has worked closely alongside the PIP, upon its official introduction it will be completely free from parliamentary influence.

In addition, any individuals who are currently looking to save towards their retirement are likely to be affected by the increase in personal allowances, which could mean less workers on low-incomes are automatically enrolled into workplace funds.

This is due to the fact that the qualifying earnings thresholds for auto-enrolment are linked to pay-as-you-earn (PAYE) thresholds.

Zoe Lynch from pensions law firm Sackers, who also spoke to Employee Benefits, said the announcement is good news for anyone who falls within the personal allowance.

Where they do not earn enough to pay tax they will reap some benefits, but “it’s a bit of a double-edged sword in that increasing the personal allowance could take people out of pensions savings,” the professional added.

According to the partner, this could have the biggest impact upon female employees, as they are the most likely to be in part-time or lower-paid positions.

Upon introducing the Autumn Statement to the House of Commons, Mr Osborne claimed that although the UK economy is beginning to heal, there are no quick fixes and there is a £33 billion extra saving on debt interest than was predicted two years ago.

Employee retention ‘biggest worry’ with Generation Y workers

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The biggest concern about workers aged 30 and below is employee retention, according to a new report.

A study conducted by Ashridge Business School, entitled Culture Shock: Generation Y And Their Managers Around The World, found the majority of managers worldwide think regular job changes and a lack of critical life skills mean younger people are less able to make effective decisions and judge risks in an organisation.

It also revealed that Generation Y employees have grown up in a different environment to older generations and as a result, they entered the workplace with other skills and motivations and they regard learning and development differently.

Ashridge Business School researcher Sue Honore stated these young professionals are associated with The X Factor, Facebook and mobile phones and consequently, their priorities are different to individuals from previous time periods.

“Gen Y is already radically altering the employment landscape globally and a new, growing workforce will soon be stepping up and challenging traditional models within companies,” she added.

The business school discovered that most Generation Y graduates are looking for a varied career and are likely to leave a job quickly if it does not bring enough employee benefits or correspond with their personal ambitions.

In addition, these professionals tend to stay in the same job for less than two years and in Britain, only 57 per cent are planning to remain with their existing employer for 24 months.

Overseas, 62 per cent of young workers in India and 75 per cent of people in the Middle East were found to be more committed to their companies, while 87 per cent of Malaysian graduate employees are the most loyal and hope to stay in the same position for the next two years.

Ms Honore continued: “All generations need to review their differences and find new ways of working for the future – both managers and Gen Y need to adapt to the changing world of work.”

This comes after a new survey from electronic signature specialist DocuSign announced Generation Y workers are the most likely to work in the run up to Christmas, with 36 per cent of this employee groups planning to work on days previously booked off.

Government to cut employee benefits in the public sector

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Government plans to cut holidays, extend working weeks and reduce flexible working for up to 450,000 public employees have been leaked.

In a letter to every human resources director across the civil service, coalition reforms and how they may impact workers were described in detail.

Signed by William Hague, HR director of the civil service, the note said “one feature [of the review] should be to promote greater mobility of staff” and that the public sector should offer “terms and conditions comparable with, but not beyond, what a good, modern employer would provide”.

The document stated upcoming changes would be made to numerous aspects of working life, which include sick pay, annual leave, probation periods and the ability of an employee to switch jobs.

Mark Serwotka, general secretary of the Public and Commercial Services (PCS) union, called the move a “sickening blow” for public sector workers.

He said: “Amid an imposed pay freeze and cuts to pensions and redundancy terms, the Cabinet Office now wants to undermine some very basic working conditions that any decent employer should offer.”

By the end of 2012, directors in every Whitehall department are expected to read through the terms and conditions of their respective workforce and form plans to make their organisations more like those in the private sector.

Many public service workers will also lose thousands of pounds under a two-year pay freeze and a one per cent pay cap.

Now, the PCS – who wrote to the Cabinet Office complaining of the reforms – have been cut off from the details of the proposals, along with all other trade unions.

The organisation argued that the reforms to part-time working patterns and laws on flexitime are likely to hit women and those with caring responsibilities the most, as they already bear the worst of the cuts.

It has called for all those affected by the changes to unite at a rally at the end of the month and challenge the Cabinet Office and government ministers through its own parliamentary group and civil service department.

In an official letter to parliament – dated September 28th 2012 – the PCS laid out a comprehensive set of terms and conditions which include the introduction of performance management, changes to grievance procedures and allowances for a range of employee benefits such as eye tests and commuting costs.

The letter asked that the alterations are implemented across all departments in stages, beginning in April 2013 and affecting all new employees from the August 1st 2015 at the latest.

In the past 12 months, the government has cut more than 35,000 civil service jobs and those who remained in employment have paid more for a pension that will ultimately be worth less and which they will not get for up to eight more years.

Union activists within the public sector claim they are being attacked by an increase in disciplinary action against elected representatives in recent months, especially if they are found to publicly denounce government policies.

Mr Serwotka stated: “It is impossible to separate this from the Tory-led government’s wider political project to unpick the welfare state and drive down pay, conditions and employment rights across the economy and we are determined to oppose it at every step.”

Share ownership ‘motivates employees’

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The majority of UK employees who have participated in their share ownership plan are motivated and committed to their employers, according to new research.

Loughborough University has released the results of its four-year study on the impact of share plans approved by HM Revenue & Customs.

It found that of the employees using the most popular scheme Save As You Earn, 71 per cent were more likely to consider cost implications of their actions in the workplace and 66 per cent produced work of a higher standard.

John Collison, head of employee share ownership at Proshare, said: “This research provides further evidence that employee share plans can deliver positive outcomes for employees and employers alike – even during financially challenging times.”

Furthermore, 60 per cent of workers said that engaging in a share plan had provided them with employee benefits, including knowing how to manage their finances better.

At the beginning of the year, deputy prime minister Nick Clegg announced that more employees ought to “have a stake” in their own organisations but that people do not realise how employee ownership can be used to unlock growth.

Smaller businesses to improve apprenticeship schemes

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Government action is being taken to promote and increase popularity of apprenticeships at small and medium enterprises (SMEs).

Plans include making them more accessible for applicants and easier for employers to carry out.

The decision follows a publication released by Jason Holt, jeweller and entrepreneur, commissioned by the Education and Business Secretaries in February.

They called for Mr Holt to direct SMEs on the best way to approach apprenticeships and outline how to train employees effectively.

Upon the release of his report Mr Holt pointed out the lack of awareness among SMEs, saying:”Whilst apprenticeships offer undoubted growth opportunities for businesses, not enough SMEs are taking advantage.”

He went on to explain that “this is because they have an outdated view of apprenticeships, are often in the dark, and frequently do not receive the specific training provision their apprentices need”.

Procedures announced by the government to put Holt’s ideas into effect include working with lawyers and accountants to promote apprenticeships to their SME clients and improve the deliverance of their employee training.

This will provide employee benefits as well as helping businesses where apprentices will receive proper training by employers who will feel more secure in their own position.

Standards will be agreed on for employee expectations and to keep the business in check consequences will be arranged for any regulations breached.

Company benefits will include the development of the Apprenticeship Grant for employers by simplifying the process by which apprentices are hired and giving them more input into the changes made.

Business secretary Vince Cable said he hopes the measures announced in the report will raise awareness of the positives SMEs can gain from apprenticeships.

He continued: “Many of the rest [of small businesses] are missing out on an effective way of growing and up-skilling their businesses.”

Government initiatives are already in place to provide incentives for SMEs, such as payments of £1,500 to employers that take on apprentices to create up to 40,000 places for people aged 16-24.

Flexible working ‘good for businesses and workers’

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Businesses that offer flexible working opportunities in their employee benefits packages could find it mutually beneficial, an expert has suggested.

According to Hilary Jeanes, a leadership coach and HR consultant with PurpleLine Consulting, flexible working allows members of staff to balance their job with outside responsibilities, such as commitments to their family.

This, she said, can help businesses keep hold of those employees who have the right skills.

“The more reasonable and flexible the business is, the more likely employees are to work hard and demonstrate the attitude the business needs to succeed,” Ms Jeanes commented.

However, she stressed that if bosses are willing to let workers operate on a flexible basis, they should be fair and prepared to accommodate the needs of their staff.

Ms Jeanes said involving either the worker or their representative in the arrangements can be a good idea.

Indeed, she argued that if members of staff are given a greater influence on the details of working flexibly, they will be more likely to work effectively.

“The more they feel controlled, the more rebellious people are likely to be,” Ms Jeanes added.

Flexible working can take different forms, so it could be worthwhile for employers to make sure they are in a position to satisfy various needs and requirements.

For instance, some members of staff might want to be flexible with their working hours, which can be particularly popular for those with responsibilities such as having to pick up their children from school.

Meanwhile, others may want to work remotely, perhaps by setting up an office in their own home.

Making flexible working opportunities could also be a good for a business in that it can help improve the health and wellbeing of its staff.

A recent study by the Kenexa High Performance Institute argued that encouraging more flexibility in the workplace could help to tackle work-related stress. This could in turn make workers more focused and less likely to take time off.

Employers urged to offer group income protection

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Group income protection could prove to be a valuable addition to an employee benefits package, experts have suggested.

According to Aviva, relatively few employers currently make this option available to their workers.

This, it said, is despite the fact it can be one of the most effective ways of controlling the impact of sickness absence on a business.

Aviva stated that group income protection has a number of benefits, both for the business and the employee who is off sick.

Indeed, it noted that companies can receive financial support when a worker is absent, while the sick person can collect a “partial benefit if they make a staged return to work”.

In addition, Aviva said group income protection allows workers to access various types of rehabilitation support to help them recover.

Steve Bridger, Aviva UK Health’s head of group risk, commented: “Many of the challenges employers and employees face as a result of sickness absence can be addressed by group income protection.”

Research by the group found that more than half of British workers would like their boss to offer flexible working hours, while over four in ten said their employer should be more generous with the amount of time they are allowed to take off to convalesce and recuperate.

Figures also showed that 53 per cent of bosses believe they have the resources to cope with a long-term sickness absence.

However, many conceded that a person being off sick can negatively impact on productivity, the standard of the service they offer and the financial position of their firm.

“Sickness absence not only has a knock-on effect to other employees, but adds to the business concerns of employers as a whole,” Mr Bridger observed.

Nevertheless, he added that many bosses have put preventative measures in place to reduce the impact of ill health among workers, which he described as “encouraging”.

Auto enrolment reforms ‘boost pensions access to millions’

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Millions of people should benefit from the introduction of automatic enrolment to pensions, experts have stated.

Many organisations already offer company pension schemes as one of their employee benefits – a move that can often improve staff morale and loyalty, as well as the worker’s future financial position.

But the government is making changes to the system due to concerns over the fact lots of people are failing to put money aside for their future, which could impact on their quality of life when they have stopped working.

From the end of 2012, the biggest companies in Britain will be rolling out automatic enrolment, while smaller businesses will follow suit later on. Eventually, it is expected that all firms in the UK will adopt the system, which is available to workers over the age of 22 and earning more than £8,105 per year.

Workers will be entitled to opt out, while those who are already signed up to a pension scheme will not be eligible.

The National Employment Savings Trust is confident the changes will have widespread benefits.

Indeed, chief executive Tim Jones has said the reforms will “give millions more instant access to a pension that employers and the government will top up as well”.

“A lot of people who are now retired benefited from automatic company pensions during their working lives, which haven’t been available for the majority of younger people working in the private sector,” he commented.

Mr Jones acknowledged putting money aside for later life is difficult, but insisted that saving for the future is worthwhile.

The auto enrolment reforms have already been commended by the Association of British Insurers, which said they should give people the “nudge” they need to save for their retirement.

Maggie Craig, acting director of life, savings and protection at the group, stated that this should help to break the “savings stalemate” that currently exists in the UK.

Employee benefits package ‘can reflect wider brand’

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A fashion outlet has said the employee benefits package it offers should demonstrate its success.

According to Sarah Chitty of Republic, the company’s external brand “thrives internally in everything we do”, reports EmployeeBenefits.co.uk.

This, she said, made it “imperative” to ensure this is reflected in the package it offers to members of its staff.

The approach seems to be yielding positive results, as the number of people signing up to its employee discounts programme has gone up by 40 per cent during the year to date.

Republic specialises in men’s and women’s fashion and has been keen to stress the inclusivity of its workforce.

Indeed, its official website points out that people who work for the firm are part of “one big team”, regardless of whether they are based at head office or at a store.

“Out supportive and vibrant culture is underlined by strong brand values which form our approach to work and each other,” Republic commented.