When British Sugar’s head of reward, Henk Verhoek, joined the organisation in March 2013, he brought with him a mantra: reward is more than pay. He had already introduced this concept at two previous employers, expanding each reward function from a payroll-focused, operational role to encompass total reward.
“Pay is very important and it has to be on an acceptable level, but there are so many other things that are also important to people,” says Verhoek. “I always look at total reward in four sections: variable pay, the benefits, learning and development opportunities, and what we offer as an organisation.”
When Verhoek asked British Sugar’s directors and senior managers about their perceptions of pay and benefits within the organisation, he received three main responses: ‘We don’t have any benefits’, ‘We have benefits, but I don’t understand what they are’, and ‘I know we have benefits, but it’s such a hassle to get access to them’.
Historically, British Sugar has offered its staff a range of benefits, but these were disjointed and administered via paper forms. Those perks fit into the traditional definition of voluntary benefits, although Verhoek does not think such categorisation is necessary.
“I wouldn’t say we have flexible benefits, but we have benefits that are flexible,” he says. “My perception of flexible benefits is the strong connotation of a heavy administrative burden. I wanted to create something that is low-maintenance but easy to access.”
Online benefits portal
The organisation launched an online benefits portal called My Staff Shop, provided by Gee7, in November 2013. This brought all its benefits into one place for the first time. Employee can access the portal at work or at home, 24 hours a day, seven days a week, through computers, tablets and mobile devices.
British Sugar held an on-site benefits fair at its Peterborough head office to launch the scheme. It also gave face-to-face presentations about the portal and all the benefits it includes at each of its four factories. It will continue to communicate the benefits using targeted emails and campaigns.
“We have take-up of 60%,” says Verhoek. “We will keep focusing on the remaining 40%. If we help people to understand how good the benefits are, they will pick up on it.”
The organisation also carries out an employee engagement survey every two years, the first of which took place in 2011. Since then, it has seen a rise in staff engagement from 74% in 2011 to 76% in 2013. It has also seen a 3% rise in the number of employees completing the engagement survey. Satisfaction scores around the working environment, and performance and recognition have also increased. Verhoek adds: “I think that is mainly because we have been focusing on taking actions from the engagement survey.
“We thought that was very important. It is the voice of the employees. We listen to them and see what we can actually do to accommodate their needs.”
Total reward proposition
British Sugar will continue to respond to employee feedback as it develops its total reward proposition. For instance, it currently offers only senior and middle managers, about half of its employees, access to an employer-paid private medical insurance (PMI) scheme, while the rest of the workforce has the option to purchase PMI via an employee-paid scheme.
“We are looking at making the PMI offering more flexible,” says Verhoek. “It’s part of my philosophy on benefits.
“What we want to create is a suite of benefits where there is something for everyone. We recognise that people are in different stages of their lives. For some, childcare vouchers might be very important. For others, it might be things like PMI or the bikes-for-work scheme.”
Verhoek’s definition of total reward is all the things an employer offers that employees do not really think about. “It goes beyond the monetary bit and looks at things people get real satisfaction from, such as career development, personal development and working in a safe place,” he says.
“I focus on all the different elements, which also helps me interact with all the other parts of the business. It needs to resonate with everyone in the organisation.
“We have to think of reward as a whole. The strategy is really looking at where we are today and where we need to go into the future. That has to be strongly aligned with other activities in the organisation.
“We have the HR strategy, which is about British Sugar being a great place to work, as well as looking at the business strategy and making sure it’s all aligned, that nothing stands on its own.”
- Henk Verhoek will speak at Employee Benefits Live, which will take place on 24 and 25 September 2014 at Olympia, London.
British Sugar at a glance
British Sugar has four sugar-beet factories in East Anglia which produce more than one million tonnes of sugar a year. It is part of AB Sugar, which is wholly owned by Associated British Foods (ABF), which also owns brands such as Primark and Twinings.
British Sugar’s first factory was built in Cantley, Norfolk, in 1912. The organisation was owned by the government until 1981, when it began trading as a private company. It was bought by ABF in 1991.
With a focus on taking an integrated approach to manufacturing, British Sugar also produces 500,000 tonnes of animal feed from sugar beet pulp; recycles stones, lime and soil for landscaping; exports enough heat and power from its factories to power 160,000 homes; and uses carbon dioxide and water from the sugar manufacturing process to grow about 140 million tomatoes a year.
It has 1,200 permanent employees and takes on an additional 300 to 500 casual workers during the sugar-manufacturing season between September and March. The average age of staff is 42 and the average length of service is 11 years.
- The European sugar quota system, which legislates how much sugar is produced each year, will be scrapped in September 2017, opening up the market to more competition.
- Negative media coverage about sugar.
- The fall of sugar prices over the past year.
Henk Verhoek has been head of reward at British Sugar and AB Sugar since March 2013.
He previously held various roles at Inchcape Shipping Services, including head of global reward and group compensation and benefits manager. He has also been global compensation and benefits manager at Wilhelmsen Maritime Services and held a range of HR roles at Unitor Ships Service.
At Inchcape and Wilhelmsen, Verhoek built the global reward function from scratch. He says: “Reward was not on the agenda, HR was a very operational role, and they wanted to have more of a strategic approach to reward, HR and benefits.
“I basically built the whole reward function from being a very operational, payroll-related role to a strategic function within those organisations, so introducing total reward thinking. I am quite proud of leaving that as a legacy in those organisations.”
Verhoek is taking the same approach at British Sugar. “What I’m proud of at British Sugar is making the reward function visible,” he says. “I am a true believer in personal contact, speaking with people, doing presentations at the factories and helping employees understand what the benefits can do for them .”
Before embarking on a career in reward, Verhoek spent 15 years working in finance and auditing at Steens and Partners and EY.
- Trust-based defined contribution scheme, with employer-matched contributions up to a maximum of 10%.
- From February 2013, all non-pension members are being auto-enrolled at contribution levels of 4% for employee and employer.
- Legacy defined benefit pension schemes.
- Employer-paid private medical insurance (PMI) scheme available for senior and middle managers, which make up about 50% of staff.
- Employee-paid PMI scheme for the rest of the workforce.
- Employee assistance programme.
- Company car or car allowance for senior managers.
- Job-need cars for some staff.