Two in five employers could be “throwing away money” on employee benefits by not effectively communicating the perks on offer to their staff, a survey published yesterday has revealed.
Independent financial and corporate adviser Chase de Vere found that 41 per cent of companies do not provide regular updates to employees on the benefits available to them, leading to the money spent potentially “not being appreciated or valued” by staff.
Sean McSweeney, corporate advice manager at Chase De Vere, warned employers have become “bogged down” in the mechanics of providing high quality benefits packages rather than concentrating on telling staff about them.
“Our argument is that, in terms of driving engagement and return on investment, you are better off engaging your staff on their benefits,” McSweeney told People Management. “It’s not necessarily what you provide, but you are throwing money down the drain if you’re spending money on an excellent benefit package that no one is engaged with.”
Chase de Vere – in conjunction with independent researcher Lightbulb, which carried out in-depth interviews with senior HR leaders from 300 randomly selected UK businesses – also found less than two in five (39 per cent) employers gave annual updates on employee benefits, while a quarter (25 percent) did so on a monthly basis.
Professor Stephen J Perkins, principal researcher on the CIPD Annual Reward Management survey and editor-in-chief of the Routledge Companion to Reward Management, said engaging employees with their benefits is a great opportunity for HR to be “more strategic”.
“Employees will follow the money – they’ll behave as ‘economic people’ if they don’t find reciprocation for their predisposition to work with their managers and the grain of organisation strategy,” Perkins explained. “While it’s far from easy, here’s the challenge but also the opportunity for skilled HR policy shapers and line management capacity developers to make a positive impact.”
The survey’s results revealed that companies most commonly use their benefits to recruit and retain the right people, with 58 per cent saying this is what they used perks for. Over a quarter (29 per cent) said employee benefits were useful for providing their existing workforce a sense of security about their jobs.
However, Barney Ely, HR director at recruitment company Hays, told People Managementhis company’s research suggested a “mismatch” between the benefits employers offer and those employees think are most important.
“If employers don’t keep staff up-to-date with the benefits available, and tailor their benefits package and communications to reflect the benefits that are most important to their employees, there is a greater risk of employee dissatisfaction,” Ely said.
The Chase de Vere survey found that, while over half (57 per cent) of employers provided individual personalised letters on employee benefits, most communication methods did not provide the opportunity for employee feedback or engagement.
“[It’s crucial not to] sit in your HR bubble and decide what people want,” Debi O’Donovan, director at the Reward & Employee Benefits Association (REBA), told People Management. “It’s important to talk to people and get that feedback loop going.”
Figures published by HM Revenue & Customs (HMRC) last month indicated employers were providing a record high value of taxable benefits to their staff. Provisional numbers for the 2016-17 tax year suggested that UK employers provided a total taxable value of £8.3bn, up from £8.1bn in 2015-16.
However, the statistics also revealed that the number of people who received benefits during the same period decreased to 3.66m, from 3.76m in 2015-16.