Pensions will continue to be a hot topic as auto-enrolment fully bites. So how will employers tackle the inherent conflict of trying to engage employees to save for retirement to prevent a high opt-out rate as auto-escalation kicks in, while trying to manage a benefits budget that will not automatically increase.
There are no silver bullets on this one unfortunately, but it is going to be key for reward professionals to establish a good platform with their senior management teams to argue the case that it is worth investing more as a organisation on pensions: both on engagement and education, as well as on contributions. It is hard to get away from the fundamental truth that people need to feel they are getting a good deal, and employers need to ensure they are offering that by, at the very least, matching contributions. The fact they are not obliged to seems a curious blindspot in the auto-enrolment legislation, but I digress.
Employers can mitigate spend in this area through the promotion of salary or bonus exchange and the subsequent national insurance savings. However, ultimately, the return on investment is the benefit of knowing it is an employer that genuinely cares about the welfare of its employees and does not want to be responsible for packing generations of workers off to retirement without the adequate means to live.
I think 2018 will also cement having a comprehensive wellbeing programme as a fundamental part of a benefits package, rather than being the preserve of larger, richer or more progressive organisations. Those that do not already have one in place are playing catch up and should seriously think about getting one before they are left behind.
Lastly, it’s hard to ignore the role that analytics now plays in our lives both as consumers and professionals, and there is exciting scope for how this technology can be applied within the HR and reward space to give employers greater insights and inform their benefit strategy. The evolution of this should mean that organisations move the focus away from benchmarking themselves against the market and focus instead on what their own employees want and value.
Nick Lawry is reward manager at Virgin Management