Voluntary benefits are the most effective weapon in an employer’s benefits armoury. Everyone needs to shop and everyone wants to make their tax-diminished disposable income go further.
Employee discounts, childcare vouchers and cycle-to-work schemes save money for employees at all levels, which no other benefit does. Return on investment on voluntary benefits is unbeatable. Add in total reward statements so that employees really understand the value of their employment package, combine with reward and recognition, and an employer is well on the way to achieving high engagement levels.
Economic turbulence puts pressure on employers to deliver high-value benefits at low cost. Employee discounts used to be ‘nice to have’, ticking a box rather than being a key component of reward strategy. However, technological advances – including the ability to integrate Web 2.0 functionality – mean discounts are the ideal platform for everything else. All staff have a reason to use employee discounts and this increases engagement with the wider employment package and employer brand. No other mechanism can reach a workforce so easily, effectively and cheaply.
The business models of discount providers have diverged into two distinct types: retailer-funded and employer-funded. Retailer-funded providers take commission from retailers and use employees as a sales channel. By contrast, employer-funded models do not promote particular products or services, attract more retailers and pass on much bigger discounts to staff. This maximises choice and savings, leading to high use, which means high employer value.
Glenn Elliott, managing director of Asperity Employee Benefits