Employee engagement is the major driver behind employers’ decisions to offer flexible benefits, according to the Employee Benefits/Towers Watson Flexible Benefits Research 2014.
A large majority of respondents (79%) use staff motivation or engagement to measure the success of their scheme, and 59% use staff retention as a measure. This suggests that the value of flexible benefits in helping to recruit, retain and motivate staff is increasingly important to employers in the war for talent that many market sectors face.
Some 90% of employers capture this information through staff surveys.
And the value of flex looks set to grow further, with more than half (55%) of respondents predicting that flexible benefits schemes will become an integral part of organisations’ employee value propositions (EVPs) in the future.
This helps to explain the increasing number of employers that offer flex to all their staff. More than two-thirds (72%) of employers give their whole workforce access to the same flex plan, with 10% offering their staff access to more than 20 benefits, which shows steady growth from the 3% that did so in the 2007 survey.
Another trend sees more employers using salary sacrifice to structure their flex plans. More than one-third (35%) of organisations offer their staff tax-efficient benefits via salary sacrifice as part of a cohesive flex plan, while a declining number offer their workforce a formal plan.
Just 21% of employers offer a formal flex plan, compared with 33% in 2011. This ties in with the perceived desire among employers to offer their workforce greater flexibility around benefits, particularly when looking to appeal to a multi-generational workforce.
Unsurprisingly, childcare vouchers remain the most popular benefit available through flex, offered by 86% of employers. Dental insurance is the second most popular perk offered through flex, by 83% of employers.
Salary sacrifice car schemes are the most popular benefit that employers plan to add to their flex schemes, with 22% of employers saying so. Some 16% plan to add computers for home or tablets to their flex plan and 11% plan to add mobile phones, which is not surprising as employers seek to boost their employee value proposition (EVP).
On a final note, as promised, we carried out a prize draw of all respondents that completed the Employee Benefits/Towers Watson Flexible Benefits Research 2014. The lucky winner, Olga Clark, will receive an iPad mini.
Clare Bettelley, associate editor, Employee Benefits