Employee expectations have shifted from solely focusing on salary to a broader view of the benefits package. In this article, we explain why relevant and flexible employee benefits often matter more to staff and share our innovative ways to implement benefits that boost engagement and productivity.
Employee engagement requires more than just a list of benefits
Today’s employees are hungry for more. They want a better work/life balance, a stronger, more meaningful company culture, and a range of benefits, perks and resources that can protect and enhance their lives (both inside and outside the workplace).
But above all else, they want an employer who cares about delivering these benefits rather than paying lip service to them.
With more research being conducted around the link between employee benefits and employee engagement, productivity and retention, the advantages are clear: engaged employees outperform their competition.
Here are some interesting findings from Gallup's Q12 employee engagement assessment:
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Companies with engaged workforces have higher earnings per share (EPS).
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Engaged employees show up and work harder. Highly engaged business units see an 81% difference in absenteeism and a 14% difference in productivity.
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Engaged workers are more likely to stay with their employers. In high-turnover organisations, highly engaged business units achieve an 18% difference in turnover. In low-turnover organisations, highly engaged business units achieve a 43% difference in turnover.
You cannot compete on compensation alone
The takeaway here is that money is no longer the sole motivator. By offering a considered benefits package alongside competitive wages, you can stand out as an employer of note. It shows current and prospective employees that you’ve given careful thought to their individual needs rather than offering a one-size-fits-all solution.
It also gives your employees a reason to stay rather than look elsewhere for an employer who’ll meet their evolving expectations. In fact, it can be costly if you don’t. Recruitment alone costs around 20-30% of the final salary, which is, on average, over £5,000. This is without the cost of onboarding and training new employees.
Changing your approach to employee benefits and retaining your top talent will almost always be cheaper than replacing them.
Expert tips for improving employee engagement and productivity through flexible benefits initiatives
Let’s look at four ways you can promote innovative employee benefits and reap the rewards of a more engaged, productive and loyal workforce.
1. Financial literacy can help with financial security
The recent cost of living crisis has caused many of us to tighten our belts and pay more attention to our spending habits. It has also highlighted the need for financial literacy among employees. According to an Unmind survey of 2,000 UK adults, 33% believe the cost of living crisis is harming their ability to focus at work.
Financial literacy refers to the ability to understand and apply different financial skills effectively. This can include money management, budgeting and saving.
Ideally, financial education should be provided before employees need it. However, employers that help their staff address concerns around financial security at any point can benefit significantly. Workers who can manage their finances and alleviate money worries tend to be healthier, happier, and more engaged, which can lead to higher productivity levels.
With this in mind, offering your employees financial education and advice as part of their benefits package can elevate their financial literacy and empower them to make better choices.
FlexGenius makes this simple with various financial education and advice features, including a jargon-busting, plain English guide to finance and tax-related terminology, engaging online video content and easy-to-use calculation tools to forecast retirement income.
Our salary sacrifice module enables employees to save tax and NI and spread the cost of pension-related financial advice by up to £500pa.
2. Help your employees save and strengthen their bonds with your company
While rising costs have forced many to cut back on their daily expenses, others are looking for ways to maintain their standard of living while spending less. This is another area where employers can unexpectedly improve the lives of their employees.
Including a range of exclusive offers, not available to the general public, in your benefits package can help staff save while strengthening their affinity with your organisation. Win-win.
As a leading independent benefits provider, we can scour the market for the best savings and most innovative products as part of our employee perks solution.
- Your staff can shop and save more, with access to the best discounts (almost 4,000 offers), including major high street retailers and supermarkets.
- Take the worry out of commuting with our What Car? Affinity perk. This unique benefits scheme delivers market-leading new car savings to employees at no financial cost to the employer.
3. Increase employee engagement and productivity by actively making their working life easier
A good employer-employee relationship should be reciprocal. But if your staff feel like you’re taking advantage, they’ll likely take their talents elsewhere. So, give them a reason to stay. Showing your people that you’re actively choosing to make their working life easier is a great way to increase employee engagement and productivity. Consider how you can benefit their health and wellbeing, and lifestyle needs inside and outside the organisation.
A popular way of doing that is with a flexible holiday trading scheme. This allows your employees to take control of their work/life balance by buying and selling their annual leave.
A personalised holiday allowance lets each employee choose what motivates them most: more money or more time off. Here are some examples:
- Extra days off give people the chance to spend time with friends and family or find the space they need to rest and improve their mental and physical health.
- Alternatively, they could buy some additional holidays to bulk out their time off and book the trip of a lifetime to a far-flung destination.
- Or they may want to sell some of their holiday allocations to increase their take-home pay, which may alleviate money worries and ease stress or help them save towards a major expense, like a new house or wedding.
Salary sacrifice is an increasingly popular trend and providing a range of options helps staff feel valued. For example, employees can enjoy huge savings through salary sacrifice for electric car purchases. Plus, this is also a good way to show your commitment to climate concerns and helping to greenify our roads.
Whichever way you slice it, when employees feel like their needs are met, they’ll be more engaged and productive.
4. Peer-to-peer recognition is a cost-effective way to improve loyalty
In a survey of over 200,000 participants from 189 different countries, “appreciation for your work” ranked as the number one factor for happiness on the job. In contrast, good work/life balance was third, career development was sixth, and an attractive fixed salary was eighth.
That’s why so many businesses have begun prioritising rewards and recognition alongside other workplace perks and benefits. Employee engagement and productivity are closely linked to feeling appreciated, valued and rewarded.
However, 88% of the HR Managers we spoke to felt their previous rewards programme fell short due to poor delivery. Manually managing reward schemes can take up valuable time and resources, and if not done right, the people most deserving of praise can slip under the radar.
Switching to an online solution and enabling peer-to-peer recognition can help you streamline your rewards programme and improve loyalty.
Giving your employees the power to celebrate one another can matter more than top-down awards like Salesperson of the Year, which can often only be given out a certain number of times to a set number of individuals each year.
Our fully integrated rewards module makes recognition visible to all employees and includes a brief narrative to offer context. Meanwhile, our leaderboard feature encourages friendly competition. You might not always be on hand to recognise the little things your staff do consistently, but their colleagues can be, which can help foster camaraderie, boost morale and increase retention.
Summary
The link between employee benefits and employee engagement and productivity is well documented. But it’s not just researchers who are making the connection. Prospective and current employees are examining benefits packages like never before to understand if an employer is worthy of their hard work and loyalty.
What is the cost of not optimising your employee benefits management to meet the shifting expectations of today’s employees? Staff will vote with their feet or be poached by the competition.
Boost employee engagement and productivity with FlexGenius’ innovative benefits platform
To maintain your competitive edge, you need a first-class employee benefits platform. FlexGenius is a forward-looking solution for retaining your best employees.
Our comprehensive and innovative employee benefits software offers a range of great features and enables HR teams to incorporate almost any kind of benefits and salary sacrifice initiatives. You can integrate FlexGenius with your existing systems and provide the flexibility benefits you need to keep your employees engaged.
Watch our short explainer video to see how our platform works and the impact it could have on your employee engagement and productivity!
Explore our range of features to learn more about FlexGenius or book a free demo today.
Avantus does not provide tax or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax or accounting advice. You should consult your own tax and accounting advisors before engaging in any scheme.
